BASF, Covestro, Huntsman Raise MDI Prices in North America Amid Global Supply Crunch

In June 2026, the global chemical industry is witnessing a new wave of price increases. Three major MDI players – BASF, Covestro, and Huntsman – issued price hike notices in late May 2026, with increases ranging from USD 0.22 to 0.35 per pound (approx. RMB 3,310–5,260 per tonne). Some increases took effect immediately upon announcement, while others follow contract terms. As of the fourth week of May, spot prices for both polymeric MDI and pure MDI in the North American market remained elevated, with supply tightness pushing June price renegotiations upward.

Details of the price hikes by the three giants

Huntsman announced on May 22, 2026, a uniform increase of USD 0.24 per pound (approx. RMB 3,610 per tonne) for all MDI products in North and South America, effective immediately. The company also extended order lead times to three weeks after confirmation. Huntsman is running two of three production lines at its Geismar, Louisiana, facility during a planned maintenance turnaround, expected to last three to four weeks. The company stated it will review pricing on a monthly basis thereafter.

Covestro announced on May 28, 2026, a price increase of USD 0.22 per pound (approx. RMB 3,310 per tonne) for all MDI products across all market segments in North America, effective July 1, 2026, or as contracts allow. Notably, Covestro had already declared force majeure on May 19, 2026, for all its MDI products in North America, citing unforeseen production issues directly linked to a carbon monoxide/chlorine feedstock supply failure at Air Products' CO unit. The duration of the disruption remains uncertain.

BASF issued a notice on May 29, 2026, raising all Lupranate® MDI products by USD 0.35 per pound (approx. RMB 5,260 per tonne), effective immediately. BASF made it clear that this increase is in addition to previously announced adjustments. The company plans a 45-day MDI production turnaround in July, which market sources believe is related to pre-commissioning work for a new 200,000 tonnes/year capacity expansion in the U.S., expected to come on stream in Q3 2026. BASF did not rule out further price adjustments.

The three industry leaders issued their price increase notices within just eight days of each other, a highly synchronized move that market participants interpret as a clear signal of continued bullish expectations for the second half of the year.

Multiple shocks hit global MDI supply chain

The North American MDI market is facing a rare double blow. Covestro's force majeure due to restricted carbon monoxide and chlorine supply is expected to keep the situation tense at least through the end of June. Huntsman's 500,000 t/y Geismar MDI unit turnaround is expected to last until June 13. Together, these events have taken roughly 800,000 t/y of capacity offline.

Adding to the strain, a supply rupture in the Middle East has further aggravated global imbalances. Saudi Arabia's SADARA has completely halted production of 400,000 t/y of MDI and 200,000 t/y of TDI, wiping out over 90% of MDI/TDI supply from the region. In Asia, BASF's 300,000 t/y MDI plant in Shanghai began scheduled maintenance on May 11, expected to last about one month, with no new production available to the market until mid-June. Meanwhile, BASF's 250,000 t/y MDI unit in South Korea is running at low utilization.

According to industry estimates, approximately 1.94 million tonnes of global MDI capacity – about 20% of the world total – is currently running at low rates or completely idle. Pricing communication mechanisms in the North American MDI supply chain have notably shifted. Several suppliers are no longer issuing formal monthly price letters; instead, they are opting for shorter, informal renegotiation cycles, sometimes as often as every two weeks. This reflects how rapidly upstream cost conditions are changing and suggests that contract pricing mechanisms are struggling to keep pace with spot market realities.

Downstream industries face cost pass-through pressure

With BASF, Covestro, and Huntsman raising MDI prices in concert, downstream sectors such as plastics, coatings, automotive, and appliances are feeling mounting cost pressure.

The upward momentum is supported by two rigid factors: first, a shortage of upstream polyol raw materials, leading to tight supply of the polyurethane B-side, making MDI a non-substitutable essential input; second, downstream spray foam customers have pre-purchased and stockpiled at lower prices, depleting monthly spot supplies.

The MDI industry remains highly concentrated. BASF, Covestro, Huntsman, together with Wanhua Chemical and Dow, account for roughly 90% of global MDI capacity, with a CR4 concentration of around 85%. In such a market structure, pricing strategies of the top players have significant ripple effects across the industry.

Recent financial reports have already shown massive cost pressure. BASF posted Q1 2026 sales of €16.02 billion, down 3% year-on-year. Covestro's Q1 2026 revenue was approximately €3.5 billion, a decline from the previous year. Faced with persistently rising energy, raw material, and logistics costs, price increases have become a necessary move for major chemical companies to protect profit margins and maintain normal operations.