Updated April 5, 2011 – See below.
A world-wide shortage of raw shellac resin is really bugging the paint industry and causing price escalations that we have not seen, in the paint coating industry, since World War II.
Shellac is a natural resin secreted from the female lac beetle during their mating season. This secretion is gathered from trees, branches and leaves, which are primarily located in the south-east Asia nations of India and Thailand.
Shellac is used in a number of specialty convenience products which are then used by consumers world-wide. Some of the uses of shellac include products produced for nail polish, paint coatings, food processing, medical equipment use, ink products, and many other applications. Although the shelf-life of the raw shellac flakes are indefinite, the shelf-life of liquified shellac is not as long as other paint coatings made from vinyl, lacquer, or other more synthetic resins. So, “stocking-up” while supplies last may not be the best idea.
Although world-wide demand for raw shellac has risen, there doesn’t appear to be any “one thing” that has caused the shortage of raw shellac resin. One possible reason given for the shortages is that the beetles are being disturbed by human encroachments into their normal mating areas.
In its raw state, shellac is an amber flake that can be liquified into a paint coating, which can then can be applied to wood surfaces, to provide a very long-lasting protective film.
As costs continue to escalate, we anticipate a very unstable pricing market for the products we sell which are made from shellac. These products include clear and amber shellac coatings as well as shellac based primer-sealers.
While shellac has served the paint industry very well, keep in mind that there are a number of other paint products that can do many of the jobs that shellac can do.
- Varnishes and lacquers will provide a beautiful long-lasting clear finish for hardwood floors, cabinets, doors and other wood surfaces that require a natural finish.
- Water-borne and alkyd-based primer-sealers can provide the same sealing power of shellac over most stains and smoke damages.
Give us a call to discuss the “Bug Free” options we can offer you at your local Texas Paint & Wallpaper location.
Updated April 5, 2011
Of all the articles that we have ever posted, this one article has garnered the most attention from our local paint customers, from other paint stores across the country, and even overseas.
Many of our customers wanted to have more specific information about the Shellac shortage and its possible consequences to their paint and wallpaper contractor business.
Mr. Lyle Allen, the Director of Sales – Paint Channel, for Rustoleum Sales Group, was very kind to answer our questions about their Zinsser Brand of Shellac products.
Texas Paint: “What is causing the shortage of raw shellac resin?”
Mr. Allen: “Shellac is produced from a resin of natural origin, harvested primarily in India and Thailand. There, shellac resin is secreted by the tiny “lac” insect as a protective shell for its larvae, and deposited on trees. Once the insect’s life cycle is complete, the dried shell remains – thus the name shel – lac. The dried secretion left on the tree is called seedlac, the base material that after refining and processing becomes flaked shellac.
Market pricing for seedlac is determined by the amount/quantity of the annual harvest for a particular year. However, we have now experienced 3 straight years in the decline of the annual seedlac harvest, with the 2011 harvest prediction looking very grim. As a naturally harvested product, in the past seedlac demand has been affected by weather (Typhoons in the 1980s drove prices up over 130% in a five-year period) and even transportation worker strikes.
Since 2000, environmental changes have decreased the available supply of shellac. Pesticides in farm use can disturb lac bug reproduction. In addition, the economic boom in China has made Southeast Asian trees very popular for lumber harvesting challenging regeneration. Rust-Oleum has tried to maintain heavy inventory of seedlac to minimize the impact of low harvest years. Unfortunately, those reserves are gone.”
Texas Paint: “Will this current shortage of shellac resin be for an extended period of time, or will it be short-lived?”
Mr Allen: “The supply and demand for naturally harvested crops like seedlac can have immense fluctuation. Our hope is that the situation will improve. However, we are preparing for the long-term by evaluating alternative formulas including those that use less seedlac without performance compromise.”
Texas Paint: “Do you expect shellac prices to continue to escalate, and for how long?
Mr. Allen: “That is hard to say, but again, we are preparing for such difficult situations by working on alternative formulations.”
Texas Paint: “Will the shortage force new research into new formulas and products that will produce the same results that we have depended on shellac for, for so long?”
Mr. Allen: “Shellac is iconic to the Zinsser brand (whether clear Bulls Eye Shellac or pigmented like BIN Primer), and its performance is unmatched in the coating industry. While shellac is part of the Zinsser brand’s heritage, innovation is part of Rust-Oleum’s. Whether alternatives can equal the current shellac standard is yet to be seen. If it can be done, you can be sure we will be the ones doing it.”
We want to thank Mr. Lyle Allen for taking the time to respond to our questions.