News from Notch Consulting, Inc.

July 20, 2020

Tokai Carbon CB reaches key milestones in environmental projects

Filed under: Carbon Black — Notch @ 8:15 am

Tokai Carbon CB (Fort Worth, Texas), the largest carbon black company in the US, announced today that it has reached several environmental milestones at its three US carbon black plants, which are located in Addis, Louisiana; Big Spring, Texas; and Borger, Texas. These projects are part of the company’s Consent Decree regarding NOX and SO2 emissions as negotiated with the EPA and the DOJ.

TCCB said that particulate emission detection instruments and operating procedures are in place to monitor and reduce particulate emissions at all three plants. In addition:

  • Big Spring has installed and is already continually operating NOX reduction equipment.
  • Work at Borger is in process and is scheduled to be finished by April 2021 for NOX and SO2 reductions. NOX and SO2 emissions will be dramatically reduced in Hutchinson County upon completion.
  • At Addis, NOX and SO2 reduction equipment will be ordered by the end of 2020 and installation is expected to be completed by the end of 2022. Completion of this project will dramatically reduce NOX and SO2 in the West Baton Rouge parish of Louisiana.
  • In addition, TCCB is investing $25 million to install power generating equipment for the Addis plant, which will reduce the plant’s Green House Gas (GHG) emissions. While reduction of GHG’s is not part of the consent decree, this project will have a large positive impact on the environment in the Baton Rouge area. After completion of the Addis project, TCCB will have process gas generated electricity at all three plants, exporting electricity at two facilities.

TCCB already has invested more than $50 million on environmental projects for its US plants and plans to spend another $73 million by the end of 2022 to meet its agreements. Including the cogen project at Addis, the company’s full investment related to these projects will total $148 million by the end of 2022.


July 17, 2020

COVID causes steep drop in European replacement tire sales in 2Q

Filed under: Coronavirus/COVID-19, Tires — Notch @ 6:13 pm

On July 14, the European Tyre and Rubber Manufacturers’ Association (ETRMA) released data for its members replacement tire sales for the second quarter of 2020. The figures show that the COVID-19 pandemic caused the worst sales results in the history of ETRMA.

Comparing the second quarter of 2020 to Q2 2019, passenger car tires sales declined by 31%, while the decline for the first half of 2020 was 22%. In truck tires, Q2 sales declined 23%, while sale for the first half of 2020 were down 14%. Agricultural tires fared the best, seeing a decline of just 4% in Q2 and 9% for the first half of 2020.

After having been shut for an average of 33 days due to Covid-19, all tyre manufacturers in Europe slowly resumed their production in May when most European countries eased their lockdowns. As a result, there was a slight upward trend in tyre replacement sales visible towards the end of the quarter. Whether this trend will hold remains to be seen in the coming months. Being a global industry, the recovery of the tyre sector is not just dependent on Europe’s situation but how other parts of the world and global trade routes continue to be impacted by and address the pandemic.


EU auto registrations down 38% in first half of 2020

Filed under: Auto, Coronavirus/COVID-19 — Notch @ 5:49 pm

On July 16, the European Automobile Manufacturers Association released data on registrations of new passenger cars in the EU for June and for the first half of 2020. For the first six months of 2020, registrations were down 38.1% relative to the same period of 2018. Declines for the individual months are below:

  • January: -7.5%
  • February: -7.4%
  • March: -55.1%
  • April: -76.3%
  • May: -52.3%
  • June: -22.3%

Over the first half of 2020, EU demand for new passenger cars contracted by 38.1%, the result of four consecutive months of unprecedented declines across the region. Among the four major EU markets, Spain saw the biggest decline (-50.9%) so far this year, followed by Italy (-46.1%), France (-38.6%) and Germany (-34.5%).

July 10, 2020

Orion completes air emissions project at Orange

Filed under: Carbon Black — Notch @ 6:00 am

On July 9, Orion Engineered Carbons S.A. announced that it has successfully completed a significant upgrade of its emissions controls at its plant in Orange, Texas. As a result of these actions, the site complies with strengthened environmental standards which reduce the site’s emission permits for NOx and SO2 by 2,300 metric tons of air pollutant emissions per year. Technology installed at the facility includes a thermal oxidizer that is more effective than the incinerator which was previously used to reduce the pollutants. In addition, the company installed a Selective Catalytic Reduction reactor to reduce the emission of NOx. The project spanned from the middle of 2019 and is now fully operational.

July 9, 2020

Birla Carbon announces global restructuring

Filed under: Carbon Black — Notch @ 12:22 pm

This week, Birla Carbon (Mumbai, India & Marietta, GA) announced a global restructuring program. The company will transition to a global functional organization from one which previously operated in five global geographic regions. In a press release announcing the move, Dr. Santrupt B. Misra, Chief Executive Officer, Birla Carbon, said, “The Birla Carbon business has always been keenly focused on our customers and we believe that these changes will allow us to bring a greater focus to those relationships in a way that will lead to even greater innovation and partnership.”

The press release included the following management changes:

  • John Davidson, currently the President of the Europe and Africa Region, will become the Chief Sales and Marketing Officer and will continue to report to John Loudermilk, Birla Carbon’s Chief Operating Officer. Mr. Davidson will be responsible for all sales and marketing aspects of the company supported by a team of sales leaders, market sector leaders, and marketing leaders positioned around the world.
  • Sanjeev Sood, currently the President of the South Asia Region, will become the Chief Manufacturing Officer for Asia.
  • Dale Clark, currently Chief Technology Officer, will become the Chief Manufacturing Officer for Americas, Europe, and Africa.
  • Ronaldo Duarte, President of the South America Region, will be retiring from Birla Carbon later in the year after serving more than 40 years in a variety of leadership roles.
  • Mark Bass, President of the North America Region, and Todd Cottrell, President of Specialty and North Asia, are both leaving Birla Carbon to pursue other opportunities.

June 30, 2020

Cabot completes placement of air emission control equipment at Franklin

Filed under: Carbon Black — Notch @ 6:00 am

On June 26, Cabot Corporation announced that, as of June 2020, all major emission control equipment has been installed at its carbon black plant in Franklin, Louisiana. The project is part of an industry-wide agreement with the EPA’s national enforcement initiative to control air emissions from carbon black plants in the US. With this milestone, Cabot said that the project was 90% completed and on track to be completed in early 2021, well ahead of the industry deadline of April 2021. Cabot said that the project will reduce the plant’s NOx emissions by 90% through selective catalytic control and reduce sulfur dioxide emissions by 95% through wet gas scrubbing. This is equivalent to 900 tons per year of NOx and 6,500 tons per year of sulfur dioxide. A separate project at Cabot’s plant in Pampa, Texas was completed in 2017 and has reduced NOx emissions by 67%, equivalent to nearly 1,500 tons of emissions in three years, according to Cabot.

June 10, 2020

ITEC 2020 shifts to virtual event

Filed under: Conferences, Coronavirus/COVID-19 — Notch @ 9:42 pm

The next International Tire Exhibition and Conference, which is scheduled for September 8-18, 2020, will transition to a virtual event this year. The biennial conference is sponsored by Rubber & Plastics News and typically held in Akron, Ohio. The decision was made in response to the COVID-19 pandemic. The dates of conference remain unchanged, with a livestream covering the conference sessions, including keynote speakers, individual presentations, and panel sessions.

June 8, 2020

Goodyear forecasts 50% drop in tire volumes in Q2

Filed under: Coronavirus/COVID-19, Rubber, Tires — Notch @ 12:42 am

In a 424B filing to the Securities and Exchange Commission dated May 13, 2020, Goodyear Tire & Rubber provided an overview of its actions in response to COVID-19 and a view of the tire industry’s performance in 2020.

We currently believe that our largest volume declines will occur in the second quarter of 2020, with volumes down approximately 50% compared to the second quarter of 2019. Overhead absorption will also continue to be adversely affected by reduced plant production during the second quarter of 2020. We are currently planning for our production to be down almost 25 million units versus the second quarter of 2019 in order to reflect expected demand and to reduce inventory.

In addition, our other tire-related businesses are also being significantly affected by the weakening economic environment. Traffic and volume at our retail locations is low and the sharp drop in business and leisure travel is adversely impacting our aviation business. Our chemicals business is also feeling the effects of the decline in tire production. In total, the year-over-year earnings decline in our other tire-related businesses is expected to be about $150 million during the second quarter of 2020.

For the full year of 2020, we now expect our raw material costs will be a benefit of $50 million to $100 million compared to 2019, excluding transactional foreign currency and raw material cost saving measures. Natural and synthetic rubber prices and other commodity prices historically have been volatile, and this estimate could change significantly based on fluctuations in the cost of these and other key raw materials. We are continuing to focus on price and product mix, to substitute lower cost materials where possible, to work to identify additional substitution opportunities, to reduce the amount of material required in each tire, and to pursue alternative raw materials.

June 3, 2020

JK Tyre launches US operations

Filed under: Tires — Notch @ 10:42 pm

JK Tyre, one of India’s leading tire producers, recently announced the creation of a new entity, Western Tires Inc. in Houston, Texas, which will act as the company’s marketing arm in the United States. JK Tyre has been exporting tires to the United States for more than 20 years, and the new company represents an expansion of those efforts. JK Tyre imports tires into the US from its factories in both India and Mexico.

Cooper restarts Mexico plant

Filed under: Tires — Notch @ 9:33 pm

Tire Business reports (subscription required) that Cooper Tire & Rubber is restarting production at its tire plant in El Salto, Mexico. Cooper first idled the plant on March 21 due to COVID-19 concerns. The plant was restarted on April 13th but idled again on April 28 under orders from the Mexican government, which deemed the plant to be non-essential. Cooper has implemented new health and safety procedures at the plant, and production was scheduled to resume on a limited basis on June 1.

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