Jonathan Moreland
Solutia announced a price increase of 10% across much of its worldwide resin business on June 4, starting with shipments made in July 1. Two days prior, PolyOne had increased its prices by as much as 20% across its business units and geographical regions.
Price increases were already a hot topic in NeuMarket's first-quarter conference call held at the end of April. On the call, management was specifically asked if second-quarter prices are going to be higher than first-quarter prices. The affirmative answer came from NeuMarket's principal financial officer, David Fiorenza. Other similarities at these three firms are that they have had rough times over the past few years and were forced to adjust their business models to them. Management at each has sought to move their focus away from the more commodity-oriented end products they used to rely on to more specialized product lines that can still garner a decent margin. These transitions were painful and lengthy, most notably at Solutia. Cost containment is still a continuing mantra -- and, importantly, a possibility -- at all these firms.
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