May 10, 2021
Dear Valued Customer,
I hope this letter finds you and your team well during this challenging period for many businesses.
Double H Plastics continues to strive in our efforts to minimize the impact of escalating cost factors for our customer base. For many months we have witnessed sharp price increases in our primary raw materials, high impact polystyrene and polyethylene, used to manufacture your extruded products.
The increases have been driven by extremely tight resin supplies as a result of many plant outages occurring in late 2020 and early 2021. Capacity from these outages has been slow to return, resulting in spiking resin prices in the presence of strong demand. Likewise, we have experienced continued upward pressure on wages, utilities, packaging and other associated costs.
Our team has been able to offset some of the increased costs through continuous efforts to achieve productivity improvements across our extrusion product line. However, these marginal efficiency gains have fallen well short of the significant costs we have absorbed during the past 12-18 months.
Against this backdrop, Double H Plastics is announcing a price increase effective with shipments June 1, 2021. HDPE products will increase by 17% and HIPS products will increase by 22%. This will enable us to offset some, but not all, of the cost increases we have incurred. Unfortunately, resin price increase announcements for polystyrene and polyethylene continue to mount due to very tight supply/demand balances for these commodity resins. Should these price increases come to fruition, we will have to adjust our prices again in the coming months.
In an effort to provide our customers with some potential relief, as resin prices should eventually begin to retreat, we will institute quarterly price adjustments based upon the relative change in resin prices commencing October 2021.
I understand news of price increases is never welcome and recognize the impact this will have to your business. Please know we have done everything possible to forestall implementing these prices increases, but we can no longer absorb the added costs. Double H will continue to reinvest in our extrusion business to assure our customers receive high quality, innovative products with excellent service.
Joe Harp, Jr., National Sales Manager; Extruded Products, will contact you regarding the details for the June price schedule for your products. On behalf of all of us at Double H Plastics, I want to thank you for your continued business.
Peter G. Haney
Executive Vice President
Quality to the Core!
Provided by Double H Plastic, Inc.