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Cabot closes US carbon black plant, while Degussa doubles capacity in Brazil
NEWS
intermediates. The company cites the continued high level of crude oil prices and energy costs as well as a reduced supply for key raw materials due to the closing of several production plants in China to decrease environmental impact. Elsewhere, the Packaging and Building Materials business of Rohm and Haas (www.rohmhaas.com) is increasing the price on all its Paraloid™ impact modifiers and processing aids sold in North America by up to 10% from 1 July 2007 to counter rising input costs. For the same reasons, Lanxess (www.lanxess.com) increased its prices for rubber chemicals by between 100–220/tonne or US$150–300/tonne globally from 15 June. Affected by these adjustments are Vulkanox antioxidants, Vulkazon antiozonants, Vulkanol plasticizers and zinc oxides. At Velsicol Chemical (www.velsicol.com), the Benzoflex®, Velsicol® DOA, TOTM and DOM, and Admex® plasticizer product lines are among the products subject to a price rise of up to $0.07/lb from the beginning of July. Also affecting plasticizers, BASF (www.basf. de) has recently raised prices for intermediates 2-ethylhexanoic acid by 40/tonne in Europe, and for Neol® neopentyglycol by $0.03/lb in the USA, Canada and Mexico. All the major producers of titanium dioxide (TiO2) pigments have raised their prices worldwide from 1 July 2007. New major player Cristal Global (www.cristalarabia.com), which recently concluded its acquisition of Millennium Inorganic Chemicals [ADPO, July 2007], is increasing prices on the sale of all rutile and anatase Tiona® and Cristal TiO2 products sold to all end-use markets worldwide. Prices will increase by US$0.05/lb in the USA and Canada, by 80/tonne in Europe, by $120/tonne in the Middle East and Africa, and by $100/tonne in Central and South America and the Asia Pacific region. These price increases are necessary to improve margins, which must increase in order to justify future investments in additional capacity and to offset continued increases in costs, Cristal says. Number one producer DuPont Titanium Technologies (www.titanium.dupont.com) has raised prices for all DuPont TiO2 grades by US$0.05/lb in the USA and Canada and by $100/tonne in the Asia Pacific. The prices for all Ti-Pure® grades have been increased by $100/tonne in Latin America, by 80/ tonne in Europe and Africa, and by $120/tonne in the Middle East. The company says these increases are supported by current improving economic conditions,
6
Additives for Polymers
strong TiO2 global demand, significant increases in raw material, energy and fuel costs, as well as reinvestment economics to meet future customer needs. Very similar increases have also been brought in by Huntsman Corp (www.huntsman.com), Kronos Worldwide (www.kronostio2.com) and Tronox Inc (www.tronox.com).
Cabot closes US carbon black plant, while Degussa doubles capacity in Brazil
C
abot Corp is to close its carbon black manufacturing facility in Waverly, WV, USA. It is anticipated that manufacturing operations will cease next March with customer shipments from the facility continuing until mid-2008.
The decision to close the facility was driven by changes in the tyre manufacturing industry, which has seen significant restructuring over the past 18 months, Cabot says. There have been multiple tyre capacity reductions in North America while tyre manufacturing facilities in China and other countries in the Asia Pacific and South America regions have expanded. The company says that these changes, together with the projected growth of imported tyres to the USA, require it to adjust its North American carbon black capacity in order to maintain its competitiveness. Cabot is in the process of debottlenecking several of its other carbon black manufacturing facilities in North America to continue to meet customer requirements fully. Cabot expects the closure plan to result in a pre-tax charge to earnings of approximately US$22 million over the next two years with approximately $8 million of this amount to be recorded during fiscal year 2007. Highlighting the contrasting situation in South America, Degussa GmbH has recently doubled its production capacity for carbon black at its Paulinia plant in Brazil to 100 000 tonnes/year. According to Degussa chairman Klaus Engel, carbon black is one of the strategic growth areas that the company is systematically expanding. It is currently the world’s second-largest manufacturer of carbon black with a capacity of approximately 1.4 million tonnes per year, and the Brazilian expansion will further augment that. With the automotive industry and particularly the tyre industry growing continuously in South America,
August 2007
NEWS
the region as a whole – along with Asia – is regarded as the focus of investment activities for the company’s Advanced Fillers & Pigments Business Unit, which is responsible for the carbon black business. Export volumes are also growing, particularly to the North American market. In Brazil alone around 55 million tyres and 2.6 million vehicles were produced in 2006, with about a third of each destined for export. The country is therefore a core market for Degussa, with the tyre and technical rubber industries accounting for around 90% of Brazil’s demand for carbon black. The remaining 10% is used as a pigment in plastics, dyes, enamels and printing inks. According to Engel, the company has invested a total of 65 million ($85 million) in its Brazilian business. Overall, Degussa is ‘very optimistic’ regarding future growth in the rubber industry, Engel says, and is ‘highly equipped to meet this demand’ with the modern plant in Paulinia. Contact: Cabot Corp, Two Seaport Lane, Suite 1300, Boston, MA 022102019, USA. Tel: +1 617 345 0100, Fax: +1 617 342 6103, Web: www.cabot-corp.com
Or contact: Degussa AG, Karl-Arnold-Platz 1a, D-40474 Düsseldorf, Germany. Tel: +49 211 65041 0, Fax: +49 211 65041 555, Web: www.degussa.de
ICL to acquire Supresta
I
srael Chemicals Ltd (ICL) is to acquire USbased Supresta LLC, the world’s largest producer of phosphorus-based flame retardants and other products made from phosphorus. The purchase price is US$352 million, subject to certain adjustments, mainly working capital. In 2006, Supresta had a gross profit of $49.8 million on sales of $250 million.
Originally the phosphorus chemicals unit of Akzo Nobel, Supresta was established in 2004 with the acquisition of its operations by a portfolio company of Ripplewood Holdings LLC, a US-based private equity firm [see ADPO, June 2004]. Today, Supresta employs more than 300 people in two plants, one in the USA (Gallipolis Ferry, WV) and the other in Germany (Bitterfeld). It manufactures more than
August 2007
80 phosphorus-based products used in industrial applications, ranging from flame retardants for polyurethane foam and engineering resins to plasticizers for the plastics industry, functional fluids for power stations and other uses. Supresta operates two R&D and applications centres and markets its products throughout the world, with particular strength in North America and Europe. The transaction is subject to a number of conditions, including the approval of the antitrust authorities, but is expected to close late in the summer. After the acquisition, ICL intends to integrate Supresta into its ICL Industrial Products (ICL-IP) segment to realize operating synergies, including the purchase of raw materials. Currently a leading producer of brominated flame retardants, the acquisition will diversify the segment’s portfolio of flame retardants, enabling it to initiate sales to the polyurethane foam and engineering plastics markets. It will also boost ICL-IP’s annual revenues to approximately $1.1 billion and extend its geographic marketing reach. In addition, the acquisition will enhance its R&D capabilities through the addition of organophosphorus technology and intellectual property. ‘We are excited by the growth prospects of the Supresta business itself and by the significant synergistic benefits that it offers,’ says Yossi Shahar, president and CEO of ICL-IP. The combination will create an entity with a leading position in the global flame retardant markets, strength in highpotential new markets and an expanded sales reach into strategic geographic regions, he continues. ‘Overall, we will be better positioned as a more efficient and diversified company with a wider range of products and technologies for our customers,’ Shahar concludes.
Contact: ICL Industrial Products, Makleff House, 12 Kroitzer St, PO Box 180, Beer Sheva 84101, Israel. Tel: +972 8 6297 875, Fax: +972 8 6297 645, Web: www.iclfr.com
Or contact: Supresta LLC, Ardsley Park at 420 Saw Mill River Rd, Ardsley, NY 10502, USA. Tel: +1 914 269 5900, Fax: +1 914 674 9438, Web: www.supresta.com
Additives for Polymers
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intermediates. The company cites the continued high level of crude oil prices and energy costs as well as a reduced supply for key raw materials due to the closing of several production plants in China to decrease environmental impact. Elsewhere, the Packaging and Building Materials business of Rohm and Haas (www.rohmhaas.com) is increasing the price on all its Paraloid™ impact modifiers and processing aids sold in North America by up to 10% from 1 July 2007 to counter rising input costs. For the same reasons, Lanxess (www.lanxess.com) increased its prices for rubber chemicals by between 100–220/tonne or US$150–300/tonne globally from 15 June. Affected by these adjustments are Vulkanox antioxidants, Vulkazon antiozonants, Vulkanol plasticizers and zinc oxides. At Velsicol Chemical (www.velsicol.com), the Benzoflex®, Velsicol® DOA, TOTM and DOM, and Admex® plasticizer product lines are among the products subject to a price rise of up to $0.07/lb from the beginning of July. Also affecting plasticizers, BASF (www.basf. de) has recently raised prices for intermediates 2-ethylhexanoic acid by 40/tonne in Europe, and for Neol® neopentyglycol by $0.03/lb in the USA, Canada and Mexico. All the major producers of titanium dioxide (TiO2) pigments have raised their prices worldwide from 1 July 2007. New major player Cristal Global (www.cristalarabia.com), which recently concluded its acquisition of Millennium Inorganic Chemicals [ADPO, July 2007], is increasing prices on the sale of all rutile and anatase Tiona® and Cristal TiO2 products sold to all end-use markets worldwide. Prices will increase by US$0.05/lb in the USA and Canada, by 80/tonne in Europe, by $120/tonne in the Middle East and Africa, and by $100/tonne in Central and South America and the Asia Pacific region. These price increases are necessary to improve margins, which must increase in order to justify future investments in additional capacity and to offset continued increases in costs, Cristal says. Number one producer DuPont Titanium Technologies (www.titanium.dupont.com) has raised prices for all DuPont TiO2 grades by US$0.05/lb in the USA and Canada and by $100/tonne in the Asia Pacific. The prices for all Ti-Pure® grades have been increased by $100/tonne in Latin America, by 80/ tonne in Europe and Africa, and by $120/tonne in the Middle East. The company says these increases are supported by current improving economic conditions,
6
Additives for Polymers
strong TiO2 global demand, significant increases in raw material, energy and fuel costs, as well as reinvestment economics to meet future customer needs. Very similar increases have also been brought in by Huntsman Corp (www.huntsman.com), Kronos Worldwide (www.kronostio2.com) and Tronox Inc (www.tronox.com).
Cabot closes US carbon black plant, while Degussa doubles capacity in Brazil
C
abot Corp is to close its carbon black manufacturing facility in Waverly, WV, USA. It is anticipated that manufacturing operations will cease next March with customer shipments from the facility continuing until mid-2008.
The decision to close the facility was driven by changes in the tyre manufacturing industry, which has seen significant restructuring over the past 18 months, Cabot says. There have been multiple tyre capacity reductions in North America while tyre manufacturing facilities in China and other countries in the Asia Pacific and South America regions have expanded. The company says that these changes, together with the projected growth of imported tyres to the USA, require it to adjust its North American carbon black capacity in order to maintain its competitiveness. Cabot is in the process of debottlenecking several of its other carbon black manufacturing facilities in North America to continue to meet customer requirements fully. Cabot expects the closure plan to result in a pre-tax charge to earnings of approximately US$22 million over the next two years with approximately $8 million of this amount to be recorded during fiscal year 2007. Highlighting the contrasting situation in South America, Degussa GmbH has recently doubled its production capacity for carbon black at its Paulinia plant in Brazil to 100 000 tonnes/year. According to Degussa chairman Klaus Engel, carbon black is one of the strategic growth areas that the company is systematically expanding. It is currently the world’s second-largest manufacturer of carbon black with a capacity of approximately 1.4 million tonnes per year, and the Brazilian expansion will further augment that. With the automotive industry and particularly the tyre industry growing continuously in South America,
August 2007
NEWS
the region as a whole – along with Asia – is regarded as the focus of investment activities for the company’s Advanced Fillers & Pigments Business Unit, which is responsible for the carbon black business. Export volumes are also growing, particularly to the North American market. In Brazil alone around 55 million tyres and 2.6 million vehicles were produced in 2006, with about a third of each destined for export. The country is therefore a core market for Degussa, with the tyre and technical rubber industries accounting for around 90% of Brazil’s demand for carbon black. The remaining 10% is used as a pigment in plastics, dyes, enamels and printing inks. According to Engel, the company has invested a total of 65 million ($85 million) in its Brazilian business. Overall, Degussa is ‘very optimistic’ regarding future growth in the rubber industry, Engel says, and is ‘highly equipped to meet this demand’ with the modern plant in Paulinia. Contact: Cabot Corp, Two Seaport Lane, Suite 1300, Boston, MA 022102019, USA. Tel: +1 617 345 0100, Fax: +1 617 342 6103, Web: www.cabot-corp.com
Or contact: Degussa AG, Karl-Arnold-Platz 1a, D-40474 Düsseldorf, Germany. Tel: +49 211 65041 0, Fax: +49 211 65041 555, Web: www.degussa.de
ICL to acquire Supresta
I
srael Chemicals Ltd (ICL) is to acquire USbased Supresta LLC, the world’s largest producer of phosphorus-based flame retardants and other products made from phosphorus. The purchase price is US$352 million, subject to certain adjustments, mainly working capital. In 2006, Supresta had a gross profit of $49.8 million on sales of $250 million.
Originally the phosphorus chemicals unit of Akzo Nobel, Supresta was established in 2004 with the acquisition of its operations by a portfolio company of Ripplewood Holdings LLC, a US-based private equity firm [see ADPO, June 2004]. Today, Supresta employs more than 300 people in two plants, one in the USA (Gallipolis Ferry, WV) and the other in Germany (Bitterfeld). It manufactures more than
August 2007
80 phosphorus-based products used in industrial applications, ranging from flame retardants for polyurethane foam and engineering resins to plasticizers for the plastics industry, functional fluids for power stations and other uses. Supresta operates two R&D and applications centres and markets its products throughout the world, with particular strength in North America and Europe. The transaction is subject to a number of conditions, including the approval of the antitrust authorities, but is expected to close late in the summer. After the acquisition, ICL intends to integrate Supresta into its ICL Industrial Products (ICL-IP) segment to realize operating synergies, including the purchase of raw materials. Currently a leading producer of brominated flame retardants, the acquisition will diversify the segment’s portfolio of flame retardants, enabling it to initiate sales to the polyurethane foam and engineering plastics markets. It will also boost ICL-IP’s annual revenues to approximately $1.1 billion and extend its geographic marketing reach. In addition, the acquisition will enhance its R&D capabilities through the addition of organophosphorus technology and intellectual property. ‘We are excited by the growth prospects of the Supresta business itself and by the significant synergistic benefits that it offers,’ says Yossi Shahar, president and CEO of ICL-IP. The combination will create an entity with a leading position in the global flame retardant markets, strength in highpotential new markets and an expanded sales reach into strategic geographic regions, he continues. ‘Overall, we will be better positioned as a more efficient and diversified company with a wider range of products and technologies for our customers,’ Shahar concludes.
Contact: ICL Industrial Products, Makleff House, 12 Kroitzer St, PO Box 180, Beer Sheva 84101, Israel. Tel: +972 8 6297 875, Fax: +972 8 6297 645, Web: www.iclfr.com
Or contact: Supresta LLC, Ardsley Park at 420 Saw Mill River Rd, Ardsley, NY 10502, USA. Tel: +1 914 269 5900, Fax: +1 914 674 9438, Web: www.supresta.com
Additives for Polymers
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