ADI performed a comprehensive review of vertically integrated spray polyurethane foam (SPF) producers, mapping the MDI and polyol supply chains. The study analyzed feedstock advantages in the U.S. Gulf Coast versus China and evaluated the risk of channel conflict between MDI suppliers and independent system houses. Strategic implications focused on price discipline and end-use diversification into commercial construction and midstream oil & gas.
The client
Global building materials company
The situation
A manufacturer sought to understand the competitive advantages and pricing strategies of vertically integrated foam producers.
ADI’s contributions
Integrated cost modeling
Analysis of benzene and natural gas feedstocks established a production cost advantage for China-based MDI assets.
Forward integration assessment
Interviews with system houses and distributors revealed the mixed results of MDI producers competing with their own customers.
Pricing strategy benchmarks
Sourcing of polymeric MDI and polyol price ranges established volume-based discount thresholds for strategic accounts.
Application market segmentation
Mapping MDI end-markets showed that insulation accounts for only one-third of demand, limiting SPF’s impact on raw material pricing.
Key outcomes
- Realignment of competitive positioning based on the low share of SPF demand in the broader MDI market and observed price discipline.
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