News from Notch Consulting, Inc.

August 7, 2014

Omsk Carbon Group breaks ground on new plant in Belarus

Filed under: Carbon Black — Notch @ 4:36 pm

On July 29, Omsk Carbon Group held a groundbreaking ceremony for its new carbon black plant being built in the Mogilev Free Economic Zone, Belarus. The project was first announced in February 2013, and Omsk spent the ensuing 18 months doing design work and obtaining the necessary governmental approvals. The new plant will employ 450 workers and will have 120,000 tonnes/year of capacity at start-up in 2017, expandable to 200,000 t/y at a later date. The cost is Euro 85 million (RUB 4 bn). The factory will supply customers in Europe and Belarus. Omsk Carbon Group is the largest producer of carbon black in Russia and Eastern Europe, with plants in Omsk and Volgograd.

The full press release is here.

August 1, 2014

Gas explosion rocks Kaohsiung, Taiwan

Filed under: General — Notch @ 12:45 am

A series of powerful gas explosions hit the southern Taiwan city of Kaohsiung late Thursday, killing at least 24 people and injuring up to 271. The blasts were concentrated in the Cianjhen district, and were believed to be triggered by gas (possibly propylene) leaking from underground pipelines.

Here are two early reports on the tragedy: BBC and AFP.

Update: Here is an astounding compilation of videos of the event and aftermath. Our thoughts and prayers go out to the people of Taiwan.

July 22, 2014

Evonik Industries building precipitated silica plant in Brazil

Filed under: Silica — Notch @ 6:30 am

Evonik Industries (Essen, Germany) plans to build a plant to produce highly dispersible precipitated silica in São Paulo, Brazil by 2016. The new factory is budgeted in the mid-double-digit million euro range. Highly dispersible silica (HDS) is used mainly for high-quality low rolling resistance tires. The plant also will service South America’s food, animal feed, and agricultural industries.

Dr. Johannes Ohmer, head of Evonik’s Inorganic Materials Business Unit, said: “The new plant in Americana will enable us to offer our Brazilian and regional customers high-quality silicas from local production in combination with our outstanding services.”

According to Evonik, the market for low rolling resistance tires and, consequently, for HD silicas, has been growing much stronger than the market for conventional tires in South America. Evonik expects additional demand due to a planned tire labeling program for fuel efficiency for passenger car tires in Brazil. Evonik is the only company in the world that offers both HDS and silane coupling agents, which are used to improve the dispersion and processing of silica in the compound.

Evonik is expanding its silica capacities throughout the world: By the end of 2014 alone, they will have grown by around 30 percent compared to 2010. In Chester, Pennsylvania, a plant for precipitated silica with an annual capacity of about 20,000 metric tons is scheduled to begin operations in 2014. The expansion in North and South America follows expansions that have already been completed in Europe and Asia.

In addition to precipitated silica, Evonik Industries produces Aerosil fumed silica and Acematt silica-based matting agents. Evonik has a worldwide capacity of about 550,000 metric tons per year for precipitated silica, fumed silica, and matting agents together.

July 10, 2014

Equity firm acquires Emerald Performance Materials

Filed under: Rubber Chemicals — Notch @ 5:07 pm

Rubber News reports that New-York-based private equity firm American Securities L.L.C. plans to acquire specialty chemicals maker Emerald Performance Materials L.L.C. from Sun Capital, Inc. The deal is being executed with the cooperation of members of Emerald’s management team. Emerald, which is based in Cuyahoga Falls, Ohio, was formed in 2006 as an affiliate of Sun Capital Partners, following the divesture of certain businesses from Lubrizol. The company produces chemicals for a range of niche consumer and industrial markets—including tires, structural adhesives, coatings, composites, flooring, flavors and fragrances, and food and beverages. The transaction is expected to close in the third quarter and is subject to customary closing conditions and regulatory approvals. Financial details and the names of the members of the management team involved in the purchase were not disclosed.

July 2, 2014

Evonik building silanes research center in Germany

Filed under: Rubber, Silica, Tires — Notch @ 6:00 am

Evonik Industries (Essen, Germany) is building a new research center for silanes at its factory in Rheinfelden, Germany. Ground-breaking was held on June 30, 2014 and the facility is scheduled to be complete in early 2016. The investment was valued in the “double-digit-million euro range.” Silanes are used in electronics, tires, adhesives and sealants, and plastics. Application engineering, analytics, and quality management will also be located in the new research center in the future. The center is a logical fit for the Rheinfelden site, which supports an integrated silane chemical production network encompassing research, development, application technology, and production.

The new research center will house up 70 employees in an area of around 3,500 square meters. In a press release on the project, Peter Dettelmann, head of the Rheinfelden site, explained its focus of activity as follows: “The silanes we are researching into here make chips in smartphones faster and more efficient, protect buildings from corrosion and dirt, and enable fuel-saving tires or longer-lasting paints.”

Evonik produces silanes at its sites in Rheinfelden, Germany; Antwerp, Belgium; Rizhao, China; Mobile, Alabama; and Weston, Michigan. The specialty chemical company also operates laboratories for application technology support and regionally specialized research for silanes in China, India, Germany, and the United States. Evonik’s silane portfolio comprises chlorosilanes and organo- functional silanes with an overall annual capacity of 300,000 metric tons.

Here is the press release.

June 23, 2014

PCBL announces new carbon black plant in Egypt

Filed under: Carbon Black — Notch @ 2:43 pm

Phillips Carbon Black Ltd. released plans for a new carbon black plant to be built in Borg El Arab, Alexandria, Egypt. The plant would cost US$170 million with capacity of 140,000 tonnes/year and startup in early 2016. This project was first mentioned in PCBL’s Investor Outlook from May 2013, but no details were provided at that time.

India’s biggest producer of raw carbon black, RP-Sanjiv Goenka Group plans to build a USD 170 million carbon black plant in Alexandria, according to a board member at the Egyptian Indian Polyester Company (EIPC). “The project will be located at Borg El Arab, Alexandria and spread over an area of 200,000 square meters,” Amre Fayed, a member of Board of Directors told Zawya.

“The group will invest USD 170 million in the first stage to produce 140,000 tons of carbon black, which is used in the manufacture of tyres,” he said.

The company, which is the world’s sixth biggest producer of carbon black, has ‘completed all technical and financial studies’ related to the project and submitted required papers to various Egyptian authorities for approval to start work on the plant.

Fayed said the plant is expected to start production by the beginning of 2016; around 20 percent of production will cater to domestic demand and 80 percent to exports.
When completed, the project will provide about 1,400 direct and indirect job opportunities.

May 26, 2014

China moves to scrap 5M vehicles this year

Filed under: Auto — Notch @ 2:31 pm

From Reuters comes news of plans by the Chinese government to remove five million aging vehicles from the country’s clogged roadways this year alone, including 330,000 vehicles in Beijing alone.

In a wide-ranging action plan to cut emissions over the next two years, China’s cabinet, the State Council, said the country had already fallen behind in its pollution targets over the 2011-2013 period and was now having to step up its efforts.

As many as 5.33 million “yellow label” vehicles that fail to meet Chinese fuel standards will be “eliminated” this year, the document said. As well as the 330,000 cars in Beijing, 660,000 will be withdrawn from the surrounding province of Hebei, home to seven of China’s smoggiest cities in 2013.

Beijing plans to limit the total number of cars on the road to 5.6 million this year, with the number allowed to rise to 6 million by 2017. Last year it cut the number of new licence plates by 37 percent to 150,000 a year and is also paying for another 200,000 ageing vehicles to be upgraded.

May 21, 2014

Sid Richardson foresees carbon black shortages in US by 2016

Filed under: Carbon Black — Notch @ 3:40 pm

The United States can expect to see supply shortages of carbon black by 2016, according to Gregory King, vice president of marketing for Sid Richardson Carbon Co. As reported by Tire Business, Mr. King made the comments at the Clemson University Global Tire Conference, held every year in Hilton Head, South Carolina.

“There will be a shortage of carbon black starting in 2016, provided that everyone’s expansion plans for tire production go forward as assumed,” Mr. King said. “Starting in 2016, we’re going to be out of balance.”

Carbon black nameplate manufacturing capacity in the U.S. and Mexico stands at 4.63 billion pounds per year, Mr. King said.

However, EPA efforts to control sulfur oxide and nitrogen oxide emissions from U.S. carbon black facilities will cause domestic capacity to fall to 4.11 billion pounds by 2020, according to Mr. King. Projected demand for that year points to a production shortage of 465 million pounds.

As previously report on this blog, Cabot Corporation was the first of the US carbon black makers to reach an agreement with the EPA regarding emission levels. As a part of the settlement, Cabot committed to install advanced control technology and continuous emission monitoring systems on its U.S. plants. The control technologies will be installed and commissioned over a six-and-a-half year time period at a cost of approximately $85 million.

Sid Richardson and the other US carbon black makers are in active talks with the EPA on how to cut emissions, but Mr. King pointed out in his comments that a one-size-fits-all approach may not work.

“Controlling sulfur-oxide emissions is a matter of installing wet scrubbers,” he said. “We have two plants in west Texas, and we’re not sure we can get enough water there to absorb all emissions. Maybe we could consider air preheating or other options, or find ways to use less oil.”

In any case, the industry can expect an increase in production costs because of the operating cost components over and above the capital costs, Mr. King said.

Notch Consulting is currently tracking $5 billion in new investments in the North American tire industry from 2013 through 2020, of which $4.7 billion will be in the United States.

May 16, 2014

Evonik opens new Applied Technology center in Germany for precipitated silica in tires and rubber

Filed under: Silica — Notch @ 8:19 am

On May 15, 2014, Evonik Industries inaugurated a new building to house precipitated silica applied technology for tire and rubber at its Wesseling site near Cologne, Germany. Evonik invested an amount in the low tens of millions of € in the new building. The building was completed in 13 months and 34 technicians and scientists have been working there since October 2013. Evonik supplies precipitated silica to the tire industry globally from Wesseling where silica production and research were previously located. Thus it made sense to re-locate application engineering to the Wesseling site. Evonik will use the 2,500-square-meter building to develop and test new silica products for the rubber industry. Strict quality control, which is standardized worldwide, is applied to several thousand mixtures annually. The building is heated using waste from the plant’s silica production.

Evonik is in the midst of a worldwide capacity expansion program for its precipitated silica business. In March 2014, it opened an expanded precipitated silica facility in Thailand; in May 2013, it initiated planning for a new facility in Brazil; and it will begin operations later this year in an expanded facility in Chester, Pennsylvania, USA. Evonik’s global silica production capacity will increase by approximately 30 percent over its 2010 capacity by the end of 2014.

Here is the press release: 05-15-IM-Evonik_inaugurates_new_bulding_for_its_Applied_Technology_for_tire_and_rubber_in_Wesseling

April 30, 2014

Evonik Industries announces price increase for silica

Filed under: Silica — Notch @ 11:24 am

Evonik Industries yesterday announced that its Inorganic Materials Business Unit will raise the sales prices for its silica products, metal oxides and matting agents as of June 1st 2014. The fumed silica and metal oxides are sold under the brand names AEROSIL® and AEROXIDE®. The precipitated silica are sold under the brand names ULTRASIL®, SIPERNAT®, SIDENT® and ACEMATT®. The prices will be increased by up to eight percent or as contracts allow. This measure is needed to secure sustainable supply.

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