News from Notch Consulting, Inc.

December 17, 2008

Dow Closing EPDM Plant

Filed under: Carbon Black, General — Notch @ 2:10 pm

Last week, Rubber & Plastics News (subscription required) reported that Dow Chemical was planning to shut down its EPDM rubber plant in Seadrift, Texas, according to a company SEC filing. The move is part of a company-wide restructuring that will involve the closure of 20 plants, the temporary idling of 180 more plants, and the divestiture of non-core businesses. The Seadrift plant manufactures Nordel-brand EPDM with an annual capacity of 110,000 tonnes. Dow also operates an EPDM plant in Plaquemine, La., with capacity of 100,000 tonnes.

One little known fact about the Seadrift EPDM plant is that it actually was a significant consumer of carbon black, with annual demand in the range of perhaps 20 KT. This is because the plant was selling a type of EPDM masterbatch with carbon black premixed into the compound to ease processing. According to my sources, these quantities will not necessarily be removed from the market, but the closure of the plant will move these purchases from one centralized customer (and one primary carbon black supplier) to many diffuse customers, as compounders and MRG customers will now be forced to do their own mixing, since the Plaquemine EPDM plant sells conventional material, not premixed.

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