Rubber processing industry affected by Ukraine crisis

Rubber processing industry affected by Ukraine crisis

Recent headlines have drawn attention to Europe’s reliance on Russian gas, which highlights how badly chemical industry will be damaged. There is also fear for populations in poor countries that import Russian and Ukrainian wheat in large quantities.

Although rubber industry is also a victim raw material supply Stuttering and prices soaring.

whereas rubber processing Rarely makes headlines, it is a key component of a healthy economy and is a provider of 300,000 direct and indirect jobs globally, Many of whom are now under threat from the escalating conflict in Ukraine.

“Russia is one of the most important” Suppliers to the global rubber industry“Notes a recent report by Jagger Group- One Specialist Manufacturer of Rubber, “Russian” Suppliers of Polybutadiene (BR) And Isobutene-isoprene rubber (IIR) Each has a double-digit market share. In 2021, Russian companies produced approximately 550,000 tonnes of . supplied carbon black and 240,000 tons synthetic rubber for the European Union. ,

consequently, Purchasing Officer looking for wild alternative sources, But it is becoming clear that in the short term, demand is outpacing supply. At the same time, bottlenecks are building and Logistics for essential raw materials getting entangled in the world the supply chain Problem.

With war, the situation is showing the fragility of being a Complex, international supplier structure, This is a situation that is causing the manufacturers to re-examine Efficiency benefits of on-time delivery,

If you want to learn more about this topic read: How the Chemical Industry Might Respond to the Russian Feedstock Ban or 7 Ways the War in Ukraine is Changing Raw Material Purchases.

In particular, what is different about the obstacles created by the Ukraine war is that the level of destruction is creating long-term shortages for many. major industrial material, Even if the war ends tomorrow, it will take years to rebuild it industrial capacity which Ukraine had previously provided.

with head of nato now warned that the war can go on for years, so the loss delivery method There is not a standard correction between supply and demand as has been experienced in past crises, but it is long term supply chain Failure.

To reflect this new situation, more and more governments are reframing their trade and resource policies to protect national interests. Many are also taking advantage of their natural resources and production advantages for geopolitical maneuvering. If this trend continues, it is possible that international trade The future will be disrupted more frequently by conflicts, trade wars and sanctions.

The title authors call this the ‘new normal’ and mean that Construction companies they should be adjusted Current raw material procurement practices, as well as be prepared to react to future changes. but how?

How can rubber processors better handle current and future shortages of raw materials?

1. Supply Chain Restructuring. The global pandemic, Trump is highlighting the importance of the trade war and the Russian invasion local, stable supplier, As a result, more rubber processing companies trying to source feedstocks within their home regions. This avoids bottlenecks, shortens supply routes, and avoids customs duties and paperwork.

2. Monitor geo-political developments. Recent events have made it clear that disaster can be averted by taking timely decisions and being aware of global events. Many Ukrainian companies were able to quickly Transfer stock and production capacity away from the Russian border in anticipation of conflict. Whereas sensible foreign companies bought Ukrainian supplies in January and February and shipped them out before the war broke out. This was achieved only by anticipating the coming war.

3. Simplifying the supply chain. While a time-out strategy seemed the best option a few years ago, global events have proved just how fragile this system can be. ‘Taking the warehouse off the road’, reducing supply chain complexity To avoid sanctions and charges, and holding reserve stock (Despite the high cost) Production losses can be avoided when the unforeseen happens. These measures can at least buy time in critical situations.

4. Diversifying supply chains. local and stable raw material supply High is justified, diversification also has its benefits and actually provides its own stability.

For example, a US manufacturer might source raw material A SAFE AND SECURE PARTNER – FROM US SUPPLIER – THE MOST STABLE CHOICE. However, natural disasters can also disrupt local delivery method, In this case, it can be beneficial to have some variety and source from multiple regions.

“The war in Ukraine and sanctions against Russia has affected” rubber processing industry Tough,” notes the Jagger report. “Many supply chains have been cut and it is unclear when and if the situation will return to normal. This is increasing the number of pandemic-related shortage of raw materials and pour industrial companies in a tight spot because of getting up raw material prices,

The humanitarian cost in Ukraine has been worse, causing untold hardship and suffering across the region.

Going forward, the economic effects of war are also increasing, putting rubber manufacturer Under tremendous pressure just to survive.

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