Sudden surge in the prices of two raw materials used in foam mattress manufacturing have taken mattress manufacturers by surprise. Two main raw materials—TDI and polyol—are currently 60% and 90% more than the price prevailing at the end of Q2FY21 prices. Currently both TDI and polyol are quoted at Rs 230 per kg. The spike has been due to the supply chain not being able to anticipate/adjust to the spurt in mattress demand globally. Mattress manufacturers expect these prices to continue till December, after which it is expected to moderate.
Just a few months back TDI was moving in the price band of Rs 150-170/kg much to the delight of mattress manufacturers. Similarly, polyol, another raw material used in the production was ruling at Rs 115/kg. However, recent spike in prices has thrown all their calculation haywire. Most of the manufacturers have passed on part of the increase in the raw material price to consumers while absorbing part of it themselves.
Meanwhile, some mattress manufacturers are also worried as they are getting reminded of the situation that prevailed in 2016-18. TDI is the main raw material used by the foam (used in furniture and bedding) manufacturers and the price of the same had nearly trebled during the period between 2016 and 2018. For example, price of TDI was Rs 118/kg in April 2016 which had touched Rs 325 – Rs 335/kg level in February 2018. However, price steadily came down since then.
In India, there is only one manufacturer of TDI, i.e., Gujarat Narmada Valley Fertilisers and Chemicals Ltd. GNFC has a manufacturing capacity of 65,000 tonnes pa and rest of the needs of the domestic mattress manufacturers are met through imports.