After the 14th package of sanctions, which was implemented in June this year, Russian companies began to experience problems with the supply of MDI (methyldiphenyldiisocyanate), reports the Russian RBC. It is a chemical raw material used in the production of polyurethane foams. The latter are used to produce sealants, waterproofing foams, and thermal insulation foams. These are a key element of some car parts, construction materials, and household appliances.
More Russian companies are starting to feel the effects of sanctions. “Panic broke out on the market”
Since June, the United States, the European Union, and Japan have withdrawn from supplying the chemical raw material to Russia. What's more, the country currently cannot count on support from “friendly” countries. Wanhua Chemical Group, China's largest producer, has withdrawn from MDI exports, and attempts to reach an agreement with the Saudi Sadara Chemical Company have not yet been successful.
Since MDI is not produced in Russia in industrial quantities, its prices on the local market have not stopped rising. Alexey Gorokhov, chairman of the association of building board producers, noted that the raw material has already gone up in price by about 50 percent since June. “There is panic on the market, everyone is trying to find some way to supply it,” he said.
Russia has enough raw material for two months. Entrepreneurs write a letter to the government
According to Gorokhov, Russia's current MDI stocks will last about two months, and the shortages will have dire consequences for the Russian market and will bankrupt many companies. “These are jobs, these are people who should be paid, but companies will not be able to provide them,” he said.
In this regard, more than 20 companies have signed a letter to the Russian Ministry of Industry. They demand that the government take steps to resolve the crisis. “The only way to solve this problem is to start producing this material in Russia,” says Anton Guskov, a representative of IT and household appliance manufacturers. The signatories also appeal for help in negotiations with China and Saudi Arabia.