News from Notch Consulting, Inc.

June 13, 2008

Columbian Announces Carbon Black Surcharge for European Customers

Filed under: Carbon Black — Notch @ 6:08 pm

Effective June 25, Columbian Chemicals will add a surcharge of €90.00 per tonne for all rubber blacks sold in Europe. This move follows a similar announcement for the North American market, where Columbian instituted an increase of $0.08 per pound (about $180.00 or €115.00 per tonne) effective June 1. The European action was announced in a May 26 letter to customers signed by Columbian’s European president, Heinz Derber, and its European VP of Sales, Javier Corcuera. The letter states,

With the rapid and continued escalation of energy prices, the previous methodology of pricing simply does not allow ongoing viability of our business. Columbian cannot continue to sell its products at prices that were based on oil costs that are substantially lower than current costs. We feel aligning oil costs and carbon black prices is both the best option and in the best interests of our customers and Columbian long term.

The letter states that Columbian will revise the prices monthly and modify them based on feedstock costs.

CORRECTION: The European price increase applies to list prices and is not a surcharge. The surcharge mechanism is being implemented in North America only. I regret the error.

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