India's Paint Industry
Crude Oil and Paint Costs
How paint costs depend on crude oil-based inputs and titanium dioxide, how raw material price spikes squeeze margins, and how firms pass on costs.
Paint costs depend on raw materials.
Key inputs
- Crude oil derivatives: solvents and resins.
- Titanium dioxide: a white pigment.
- Monomers for emulsions.
Price spikes
When crude prices rise, paint makers’ costs rise.
Pricing power
Leading brands raise prices to protect margins, showing pricing power.
Lag
Price increases often come with a lag, squeezing margins temporarily.
2021-22
Paint firms raised prices several times as raw material costs spiked.
The price hike
After crude prices rise, a paint company raises prices by a few percent across products.
Thinking paint costs are stable
Crude oil moves them.
Key takeaways
- Paint depends on crude derivatives.
- Titanium dioxide is key.
- Brands pass on costs.
- Margins lag price changes.
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