News from Notch Consulting, Inc.

August 21, 2019

Cabot increases feedstock surcharge for rubber blacks in North America

Filed under: Carbon Black — Notch @ 10:35 pm

On August 19, Cabot Corp. announced that it will apply a Feedstock Surcharge of $0.03 per pound for all carbon black products sold by the Reinforcement Materials segment in North America, effective October 1, 2019 and to the extent allowed under customer contracts.  This replaces the previously announced feedstock surcharge of $.01 per pound that has been in effect since April 1, 2019.

According to a company press release announcing the increase, the carbon black feedstock market in North America is seeing increasing effects from changes in the types of crude oil being refined and an increase in demand for low sulfur fuel oil associated with the upcoming 2020 International Maritime Organization (IMO 2020) regulation, also known as MARPOL. As a result, Cabot is seeing changes to the type and availability of material with the specific quality required to produce carbon black.

 

August 6, 2019

Cabot adding feedstock surcharge to specialty black sales in North America

Filed under: Carbon Black — Notch @ 12:06 pm

Today, Cabot Corporation announced that it will implement a feedstock surcharge for all specialty carbon black products manufactured in North America. The decision is driven by new low sulfur fuel regulations. Cabot will institute a surcharge of $0.07/pound for all orders shipped on or after September 16, 2019, or as customer contracts allow, for all specialty carbon black products produced by its Performance Chemicals segment in North America.

Cabot’s specialty carbon blacks are produced from high quality, low sulfur feedstocks that are sourced from a similar pool as marine fuels. This market is undergoing significant change due to the 2020 International Maritime Organization (IMO 2020) fuel sulfur regulation, also known as MARPOL. Though the IMO 2020 regulation is set to be implemented in January 2020, changes in certain supply chains are already evident.

In a press release announcing the decision, Jay Doubman, Cabot’s senior vice president and president, Performance Additives said, “We recognize this new rule will bring long-term benefits to the environment and human health; it also presents disruption in the industry and comes with upfront costs to adapt. This change in industry structure will take time to stabilize, and we are committed to providing transparency and predictability to our customers.”

Cabot expects that once new lower sulfur indices are stabilized and fully adopted by the supply chain, it will transition to pricing and indices that appropriately represent the input costs of carbon black.

August 1, 2019

Birla Carbon raising specialty black prices in North America

Filed under: Carbon Black — Notch @ 12:01 pm

On August 1, Birla Carbon announced it will raise prices for all specialty carbon blacks in North America by 9% effective September 1, 2019. All shipments made on or after this date are subject to the price increase. According to Birla, the increase is necessary due to extreme cost increases in carbon black feedstock. In addition, Birla Carbon will implement a revised schedule of fees for non-standard package services, also effective September 1, 2019. 

Here is the press release. 

July 31, 2019

PCBL opens R&D center

Filed under: Carbon Black — Notch @ 7:49 pm

Phillips Carbon Black has completed a state-of-the-art R&D center at Palej, Gujarat. Spread over 27,000 square feet, the Sushila Goenka Research and Development Centre entailed an initial investment of Rs 20 crore (US$3 million) and currently employs 30 researchers. It will facilitate development of new carbon black products for tire, MRG, and specialty markets, including engineering plastics, fibers, food contact plastics, wire & cables, ink, paints, batteries and other applications.

July 28, 2019

Orion raising carbon black prices in North America

Filed under: Carbon Black — Notch @ 9:28 pm

On July 22, Orion Engineered Carbons announced a price increase for North American carbon black prices, including both rubber blacks and specialty blacks.

Text of the press release follows:

Orion Engineered Carbons S.A. (NYSE: OEC) (the “ Company ” or “ Orion ”), a worldwide supplier of specialty and high-performance Carbon Black, today announced that effective September 1, 2019 or as contracts allow, Orion Engineered Carbons will increase sales prices by $0.08/pound for Rubber grade Carbon Black and $0.07/pound for Specialty grade Carbon Black for all Carbon Black produced and sold in North America to recover the rapidly rising feedstock costs as well as to ensure continued reliable supply.

On all Rubber grade Carbon Black, Orion will increase current base prices by $0.04/pound. This is necessary to reliably secure increased demand while maintaining quality and sustainable supply.

Carbon Black Oil (CBO) is the primary raw material/feedstock used for the production of furnace grade Carbon Black in the U.S. Costs for CBO vary based on the quality and sulfur content. Recently, demand for certain qualities of CBO has increased dramatically. This is due to IMO2020 regulations and by U.S. EPA mandates. Consequently, on all Rubber grade Carbon Black and on select Standard Specialty grade Carbon Black, Orion will implement a CBO surcharge to offset the rapidly rising difference between the cost of CBO and the reference feedstock differential (High Sulfur Fuel Oil). The floor CBO surcharge shall be $0.04/pound and will be adjusted quarterly, except where significant intra-quarter swings require quicker reaction.

For Low Sulfur Specialty grade Carbon Black, we will add a CBO surcharge to offset the differential versus the reference feedstock (1% Low Sulfur Fuel Oil). This surcharge is currently $0.07/pound and will be adjusted quarterly, except where significant intra-quarter swings require quicker reaction.

For the U.S., Orion is also updating certain charges for non-standard services to better reflect actual current costs. The updated list is available on Orion’s website.

Birla Carbon changes feedstock index for North American carbon black pricing

Filed under: Carbon Black — Notch @ 9:04 pm

On July 26, Birla Carbon announced that effective August 1 the company will change the pricing mechanism for all North America contract price formulas. The long-used index up to this date, U.S. Gulf Coast High Sulfur Fuel Oil, will change to U.S. Gulf Coast 0.5% Sulfur Fuel Oil.

In a press release announcing the change, Birla Carbon said:

Feedstock to make carbon black is sourced from markets driven by marine fuel.  This market is undergoing fundamental changes driven by regulations widely known as MARPOL 2020 or IMO 2020, which establishes the maximum allowable sulfur content in marine fuel at 0.5%.  While this regulation is effective January 1, 2020, the supply chain is adjusting now.

Naturally, these changes have impacted carbon black feedstock markets.  The high sulfur index historically used in carbon black price formulas no longer reflects the markets in which feedstock is procured.  Therefore, this change is necessary to ensure a sustainable supply of carbon black.

Carbon black price formula changes in other parts of the world will be communicated separately, consistent with the timing and manner in which those markets are impacted.

 

July 14, 2019

Tokai Carbon CB raising carbon black prices in US

Filed under: Carbon Black — Notch @ 8:51 pm

On July 11, Tokai Carbon CB (TCCB), the largest carbon black producer in the United States, announced that, effective August 1, 2019, or as contracts allow, the company will increase the price of carbon black products by $0.06 per pound. In addition, the EPA Consent Decree Surcharge will also increase from $0.03 to $0.04 per pound. According to the company, these price increases will provide the needed capital for reinvestment in operations and to complete mandated environmental compliance requirements.

Effective January 1, 2020, TCCB is also changing many of the Standard Packaging and Premium Charges. These charges are shown here: tokaicarboncb.com/pricing-and-terms. The website shows both the current and new charges until the new prices go into effect. Any new agreements concluded in 2019 will use the above pricing structure as well as TCCB’s actual corporate monthly average laid-in CBO cost as the feedstock reference price.

Here is the press release.

July 11, 2019

Black Bear named Technology Pioneer by the World Economic Forum

Filed under: Carbon Black — Notch @ 11:35 am

Recovered carbon black producer Black Bear has been selected as one of the World Economic Forum’s ‘Technology Pioneers’ alongside 55 other innovators. Black Bear develops technology to recover valuable materials from waste tires.

Each year the World Economic Forum names early to growth-stage companies from around the world as Technology Pioneers. This year, companies from a diverse set of industries have been selected, including developers of AI, IoT, robotics, blockchain and biotechnology.

“We’re excited to welcome Black Bear to this year’s innovative class of technology pioneers. Black Bear and its fellow pioneers are leaders in using novel technologies to transform their industries. We see great potential for these next-generation companies to shape solutions to global challenges and improve society for years to come,” said Fulvia Montresor, head of Technology Pioneers at the World Economic Forum.

Black Bear’s CEO, Martijn Lopes Cardozo, commented, “It’s an absolute honor to be acknowledged as a pioneer by the World Economic Forum. It is a confirmation that our technology is unique and that it carries the potential to have a global impact on both environmental and societal levels. We’ve tackled the waste tire problem by following principles of the circular economy: we identified a waste stream and figured out how to recover these valuable materials as sustainably as possible. We believe that a worldwide transition to a circular economy is essential in solving the climate crisis. This makes it extra rewarding that we’ve been named a tech pioneer and we are looking forward to contributing to the Forum dialogues.”

Read the full press release here.

July 8, 2019

Cabot announces carbon black price increase for North America

Filed under: Carbon Black — Notch @ 2:32 pm

On June 28, Cabot Corporation announced a price increase of $0.07 per pound for all carbon black shipments made in North America on or after August 1, 2019, or as customer contracts allow. In the press release, Cabot said:

This price increase is necessary to assure customers of continued supply reliability at a time of increasing demand from tire production in the region. Additionally, Cabot continues to make substantial investments and incur significant new costs to reduce air emissions and enhance the sustainability of its operations in the region. Cabot believes these actions will further augment its long-term value proposition to customers based on quality, reliability, and sustainability.

In the press release, Cabot also announced an update to the standard commercial policies for its Reinforcement Materials segment in North America, including changes to standard packaging, transportation, and warehousing premiums. These policies can be found in this PDF from the company.

June 12, 2019

Orion expanding gas black capacity in Germany

Filed under: Carbon Black — Notch @ 3:48 pm

Orion Engineered Carbons announced today that it will expand its production capacity for Gas Blacks at its Cologne (Kalscheuren) plant, Germany through a debottlenecking project. Gas Blacks are a type of premium specialty carbon black used mainly in high-end coatings, including high jet automotive OEM and refinish paints, antistatic coatings, and packaging and UV curing inks. Orion’s press release pointed to greater demand for waterborne and solventborne coatings as the main driver for the expansion. According to Orion, Gas Blacks feature excellent fineness and a very narrow particle size distribution to provide the deepest blackness Specialty Carbon Blacks available on the market.

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