Navigating The Turbulent Waters Of Price Volatility And Supply Chain In The Chemical Industry

5 min read
Supply Chain In The Chemical Industry

The pandemic has propelled supply chain challenges along with a growing market, cut-throat competition and ongoing digitization. Some of the difficult challenges faced by chemical manufacturers range from shifts in feedstock costs to changing customer choices, therefore, it is more important than ever to have a great understanding of your entire supply chain value chain.

Chemical manufacturers must rapidly adopt speed and agility to stay relevant and competitive. It’s paramount to have complete visibility into numerous aspects of the supply value chain like flow rates, tank supplies, crew availability, regulatory compliance, distributor lead times, changing customer preferences, delivery truck data, inventory shortages and many more.

5 Key Challenges of the Chemical Supply Chain

The chemical supply chain is vulnerable to many fluctuations causing instability. Here are some of the major challenges that threaten the supply chain in a big way.

1. Inconsistent Raw Material Costs

Any sudden change in the price can disrupt the flow completely as the manufacturing process largely depends on raw materials. Constantly fluctuating raw materials prices, like crude oil, natural gas, energy, and other commodities add fuel to the fire.

Inconsistent Raw Material Costs

‍2. Supply Chain Complexity

There are enormous complexities in the chemical manufacturing production process. Various products can be produced in bulk, or the streams and processes can merge or separate. These variables make the task of planning, costing, and quality management really difficult. Additionally, there is a huge pressure of reducing downtime while maximizing utilization and diminishing productivity.

3. Massive Unstructured Data Available

The industry has to deal with a huge amount of data, which is gradually becoming a challenge for effective supply chain management. Chemical manufacturers need to comply with government regulations along with ever fluctuating quality and pricing of raw materials which gives rise to contracts with regulatory bodies, vendors and customers. All data, be it manufacturing and operational data, needs to be recorded, categorized, and processed regularly. A lack of robust IT infrastructure is unable to better manage, digitize and automate this cumbersome task and draw meaningful insights out of large raw datasets.

4. Stringent Quality Control and Environmental Regulations

There are many laws like protecting the environment and human health during the handling and transportation of chemicals applicable to the industry at large. Stringent consumer protection programs focusing on maintaining high-quality control is a major concern, particularly while shipping and handling hazardous chemicals. Any negative public report or shocking news can significantly damage the reputation of the brand image quickly, forcing chemical companies to adhere to the global data compliance and labelling standards.Stringent Quality Control and Environmental Regulations

5. Fluctuating freight rates

Chemical manufacturers heavily rely on supply chains to procure raw materials from various parts of the world. Global supply chains are vulnerable to disruptions due to multiple factors like pandemic, geopolitical matters, blockage of sea lanes, etc. Freight rates continue to fluctuate every single day and need to be reevaluated till the time the payment is made after booking of the container is confirmed. Organizations should therefore create an integrated digital ecosystem and integrate them into their inventory management solution to get an end-to-end visibility into production and supply chain operations.

Fluctuating freight rates

Elchemy Can Help You Overcome These Challenges

Now that we have identified the challenges, Elchemy has the right solution for you.

Digitized Order Management – Elchemy can help you reduce your supply chain operational costs by 20% with automated tools giving you real time visibility with your complete order management system. You will have the flexibility to search for products and prices and have access to all product related documents in a single centralized repository with the click of a button.

Stock and sell model – Our strategically located stockpoints will help you with a faster turnaround time once an order is placed thereby reducing your inventory planning and operational costs.You can also reap the benefits of placing spot orders with us.

Trusted supply chain – Our in-house capabilities of long term supplier partnerships, existing freight forwarder relationships, stock points and robust technological capabilities removes the bottlenecks in your existing supply chain thereby giving you a dependable supply chain partner for life.

Competitive contractual and spot rates from freight forwarders – We have long term relationships with our freight forwarder for contractual and spot orders which benefits our customers by offering them a significant price arbitrage.

Additional QA-QC check – Elchemy conducts on-site audits for rigid quality control for all our chemicals and suppliers to ensure that the customer receives premium quality material without any damage.

Strong Market Intelligence – We do the necessary groundwork of tracking market trends and price fluctuations on chemical products and pass on the business intelligence to our customers to enable them to make informed decisions.

Elchemy is your trusted sourcing partner offering best payment terms, seasoned chemical consultants, quick turnaround time therefore, minimizing supply chain risks while helping you save upto 25% direct man-hours and upto 20% procurement costs upfront in all your chemical imports from India.



Elchemy is your high-trust gateway to the Indian chemical manufacturers. We offer best payment terms, seasoned chemical consultants, fastest turnaround times and minimum supply chain risks.

Similar Blogs

Chemical Market
Author picture
12 min read
Chemical Market
Author picture
11 min read
CAPB Report
Author picture
2 min read
Scroll to Top