Sorry for the lack of updates here. Have been working to complete the new edition of the World Markets for Precipitated Silica report, and am on vacation this week with the family. Will catch up on recent events next week.
The Management.
July 30, 2008
July 22, 2008
Columbian Seeks to Consolidate Air Permits at Hamilton
According to an article in the Hamilton Spectator, Columbian Chemicals Canada is applying for a single, comprehensive air emissions permit for its carbon black plant in Hamilton, Ontario, Canada. The single permit would replace 18 individual certificates of approval for the plant, some dating back as far as 1975. A comprehensive permit would allow Columbian to make minor process and equipment improvements without seeking amendments to the existing permits — provided it complied with provincial regulations. The application process also provides an opportunity for the public to comment to the Ontario environment ministry on the matter. The plant was identified by the ministry as a suspect in a recent incident of black fallout in the area.
July 21, 2008
Evonik Announces Pigment Black Price Increase
On Monday, July 21, 2008, Evonik announced a price increase for pigment grades of carbon black. The text of the press release is below.
Essen, Germany, July 21, 2008 — Evonik Industries’ Inorganic Materials Business Unit has announced a further price increase for carbon black pigments. The products affected are pigment furnace blacks, pigment lamp blacks, pigment gas blacks, and pigment black preparations. Depending on the product group, the price increase will amount up to 18 percent. It will be effective for all deliveries on or after August 15, 2008.
Previous price adjustments and all counter measures implemented by Evonik Industries have not been sufficient to compensate for the persistent and accelerating cost increases for feedstock, energy and transportation. For this reason, Evonik Industries has no choice but to pass on some of these costs to its customers.
Here is the press release.
July 20, 2008
SRF Acquires South African Firm
On July 14, 2008, Delhi-based SRF Limited announced it had signed an agreement to acquire the belting fabrics business of Industex Technical Textiles (Pty) Limited, a South African company. The purchase will cost approximately Rs. 20 crore, including working capital. The acquisition will move SRF from the third to the second largest producer of belting fabrics worldwide. The acquired business has an annual production capacity of approximately 3,500 tonnes of belting fabrics with annual sales of around $16 million. Prior to the purchase, SRF has 7.500 TPA of capacity for belting fabrics at its factory in Trichy.
After the acquisition is complete, the business will be known as SRF Industex Belting (Pty) Limited. The new company will be a large consumer of SRF’s new polyester industrial yarn (PIY) plant being built in Gummidipoondi, Tamil Nadu. The plant is due on-stream in early 2009.
In May, SRF signed a definitive agreement to acquire Thai Baroda Industries, a Thailand-based tire cord company.
Here is SRF’s press release on the acquisition.
New Source of Hydrated Silicate?
But the shipping costs would kill you.
Hydrated silicate minerals on Mars observed by the Mars Reconnaissance Orbiter CRISM instrument
China Begins Olympic Ban
Beijing’s massive Olympic shutdown began on Sunday, July 20. According to an article in The China Post, “Half of Beijing’s 3.3 million vehicles will be pulled off the roads and many polluting factories will be shuttered. Chemical plants, power stations and foundries left open have to cut emissions by 30 percent and dust spewing construction in the capital will be halted.” The moves are an effort to clean Beijing’s air prior to the Olympics.
As this blog previously reported, many of the measures related to the chemical industry have already been implemented, causing disruptions throughout the entire chemical supply chain. The Olympic situation injects an air of unpredictability into a market that is already extremely volatile due to crude oil prices. Expect things to get uglier still through Autumn.
Apollo Tyres Sees Challenging Times Ahead
In discussing Apollo Tyre’s first quarter results, Onkar Kanwar, Apollo’s Chairman and Managing Director, said,
“These are probably the most challenging times we have faced as a company. The unnatural rise in crude and natural rubber prices, have had a cascading impact across all raw materials. Combined with prices, which are two or three times higher than they were last year, we are facing the added problem of certain essential crude-based raw materials being unavailable even at higher prices. Merely by increasing product prices we will not be able to bridge this yawning gap. The only solution is to look internally, undertaking rigorous efficiency and economy drives across the organisation. That’s the silver lining. I believe this frugality will only strengthen the company in the long run.”
According to Apollo, between June 2007 and July 2008, natural rubber prices rose by 61%, while crude prices are up 111%. Crude-based derivatives like rubber chemicals are costlier by 60%, while polybutadiene rubber is currently experiencing a production crisis, despite a price increase of 115%.
Apollo Tyres reported consolidated revenue of Rs 13.2 billion for the first quarter of FY2008/2009, up 15% from Rs. 11.5 billion in FY2007/2008. Consolidated net profit after tax was Rs. 586.6 million, up 7.3% from the previous year. Despite the challenging conditions, Apollo reported that it was moving forward with plans to build a new greeefield tire plant in Hungary, which is in the regulatory approval stage, and a new plant in India’s Tamil Nadu region, which is under construction.
Here is the discussion of Apollo Tyre’s results.
Here are the results.
Lanxess Opens Research Center in Qingdao, China
On a July 17, 2008, Lanxess AG announced the opening of a new Rubber Research Center (RRCQ) in Qingdao, Shandong Province. The center was established in cooperation with Qingdao’s University of Science and Technology (QUST), and is located in close proximity to the campus. The project represents an investment of around Eur 10 million, and will be operated jointly by Lanxess’s Technical Rubber Products, Butyl Rubber and Performance Butadiene Rubbers business units.
According to Günther Weymans, head of the Technical Rubber Products segment, the center will provide the entire research spectrum from basic research and technical customer service to preparation for the commercial exploitation of new developments.
Lanxess has a significant presence in China. In 1997, Lanxess opened a research and development laboratory for leather chemicals in Wuxi near Shanghai. In 2005, the company inaugurated a center for technical rubber in Shanghai, and in 2007 opened the Semi-Crystalline Products Research and Development Testing Center in Wuxi. The same year, the Performance Butadiene Rubbers business unit signed a cooperation agreement with the Beijing Institute for Rubber Research, and in 2008, Lanxess opened a microbiological laboratory for material protection products in Wuxi.
Here is the press release.
July 9, 2008
Evonik Exploring Thermal Black Plant in Russia
On July 8, 2008, Evonik’s Inorganic Materials unit announced that it was evaluating the construction of a 20,000 tonne/year thermal black plant in Russia. The plant would be a joint venture with Russian Synttech Group, which owns the rights to a gas field near Inta, Republic of Komi, Russia, where the plant would be located. On June 30, 2008, representatives from the two companies signed a Letter of Intent in Frankfurt, Germany regarding the project. The two companies would be jointly responsible for marketing and sales efforts. Evonik Degussa currently operates a thermal black plant in Borger, Texas.
Birla Delays Mexican Plant
According to the Times of India, Birla Group has confirmed that it is delaying the construction of its planned carbon black plant to be built in Altamira, Mexico. The article states that Birla has purchased the land and obtained the necessary environmental approvals, but is focusing on other expansion projects, including a greenfield expansion in western India. The group had floated a company called Birla Carbon Mexico to implement the Mexico project. As per the plan, the facility was to initially produce 60,000 tonnes/year, expandable to 200,000 tonnes/year.
Said Rakesh Jain, head of carbon black business, AV Birla group: “Because of a slowdown in the US economy, we have deferred the Mexico project start-up for a short period. We will assess the situation in the next six months.”
The Times article states that the Altamira plant was originally to be commissioned at end of 2007, but I believe this is incorrect. When I first heard of the project in late 2007, startup was scheduled for late 2008 at the earliest, and it quickly became apparent that it would be later than that. In January 2008, this blog reported that the plant was delayed due to higher-than-anticipated start-up costs and a focus on other projects. In April, The Economic Times of India reported that Birla was close to signing an agreement on the land for the project.