Another Modified Plastic Leader, Full Range Price Adjustment

Dawn Co. issued an announcement for the price adjustment of its full range of products, becoming another leading company in the high molecular new materials industry to initiate price adjustments due to the pressure of raw material costs. This price adjustment is not only a market-oriented choice for the company in response to market changes but also reflects the cost transmission dilemma and the challenges of stabilizing the supply chain faced by the domestic high molecular new materials industry under the current global supply chain fluctuations.

Part 01 Common Challenges in the Industry: High and Volatile Crude Oil Prices, Cost Pressures Spreading Across the Board

From a broader market perspective, the price adjustment by Daoen Co. is not an isolated case but a concentrated manifestation of the overall pressure on the industry. Recently, the ongoing geopolitical conflicts and multiple unforeseeable factors have pushed global oil prices to maintain a high level of volatility. As a core upstream raw material for high molecular new materials, the fluctuation in oil prices directly affects the petrochemical industry chain.

The domestic polymer new materials industry is generally facing a dual pressure of rising raw material procurement costs and tight supply chains. Whether it is core categories such as thermoplastic elastomers and modified plastics, or specialized products such as biodegradable materials and melt-blown materials, all are affected by the rise in raw material prices, leading to a significant increase in enterprise production costs. This cost pressure has gradually spread from the upstream raw material end to the downstream manufacturing end, covering multiple application areas such as plastic processing, automotive, packaging, and medical industries, becoming a cyclical challenge that the entire industry needs to jointly address.

PART 02 Price Adjustment Market Characteristics: Industry Leaders Spearhead Adjustments, with Differentiated Implementation Becoming the Dominant Trend

From this price adjustment plan of Daowen Co., Ltd., the characteristics of “full-category coverage and differentiated price increases” align with the prevailing industry trend in price adjustments.

The price adjustment covers the entire product range of thermoplastic elastomers (TPV/TPE/TPU), special elastomers (HNBR), modified plastics, color masterbatches, and biodegradable materials, which is highly consistent with the price adjustment categories of several peer companies, reflecting that cost pressure has permeated the entire product system of high-performance new materials.

In price adjustment implementation, rather than applying a uniform increase, companies adopt a differentiated approach—adjusting prices individually based on raw material cost pass-through variations, through one-on-one communication with customers. This is currently the industry’s mainstream response to cost fluctuations. Such a differentiated implementation model not only accounts for variations in raw material costs across different products but also considers personalized factors such as downstream customers’ cooperation scale and duration, thus striking a balance between cost pass-through and customer retention—a reflection of the industry’s rational trend in price adjustment.

Part 03: Supply Chain Game Theory: Dual Balance of Supply Chain Stability and Supply Assurance versus Cost Pass-Through

In this price adjustment incident, Daowen Co., Ltd.'s "stabilizing the supply chain and ensuring supply" initiative highlights the core logic of the current industry supply chain—building supply chain resilience while passing on costs.

From a market perspective, the current high-performance polymer new materials industry is caught in a dual between “cost pressure” and “supply stability.” On one hand, enterprises need to adjust prices to pass on cost pressures and ensure operational sustainability. On the other hand, downstream manufacturing sectors—particularly automotive and high-end packaging, which demand superior material performance—urgently require stable raw material supply, as supply chain disruptions would directly impact production schedules.

Against this backdrop, leading enterprises, leveraging strategic partnerships with upstream petrochemical companies and diversified procurement channels, have become pivotal forces in stabilizing supply chains and ensuring supply. Whether it is Daowen Co., Ltd.'s collaborative supply network built with Shanghai Petrochemical and others, or other industry leaders’ supply chain arrangements, these examples demonstrate how leading firms are utilizing their resource integration capabilities to secure order fulfillment during periods of cost volatility—showcasing not only their own competitiveness but also providing critical support for overall industry supply chain stability.

From the perspective of market development trends, the ongoing adjustment of the global supply chain structure may lead to fluctuating raw material prices becoming the norm in the high-polymer new materials industry. This price adjustment by Daon Corporation further confirms that the industry is entering a "cost-driven" adjustment period. In the coming period, price transmission will remain the key keyword in the industry.