News from Notch Consulting, Inc.

Orion Engineered Carbons has announced that it is adding an Environmental Compliance Surcharge or “EPA surcharge” to its price agreements for all customers of products produced in North America for 2019.

The surcharge is intended to offset the incremental variable costs associated with Orion’s compliance with its 2017 consent decree with the US Environmental Protection Agency and the US Department of Justice. The company will review the surcharge on a quarterly basis for adjustment as costs become known. Orion Engineered Carbons will implement a 1.5 cent ($0.015) per pound EPA Surcharge, or price adjustment, as of April 1st, 2019. The Surcharge will be added to all invoices for customers purchasing products produced by one of Orion’s plants in North America and sold by our Rubber and Specialty Carbon Black business units.

Tokai Carbon CB Ltd. (formerly Sid Richardson) also has announced plans to implement a surcharge for North American customers to cover approximately $100 million in environmental investments at its three US plants.

Last week, Cancarb Limited, a subsidiary of Japan-based Tokai Carbon, announced that it is adding a sixth production unit for thermal carbon black at its plant in Medicine Hat, Alberta, Canada. Engineering and construction on the unit will begin immediately and is scheduled for completion by the summer of 2020. The new unit will add 9,000 tons per year of capacity to bring plant capacity to 54,000 tons per year. The unit will produce Cancarb’s Thermax medium thermal carbon black. The new unit also will add 5 MW of recovered waste heat power for a plant total of 32.5 MW.