Chemical Prices Tack Upward


Chemical companies continue to crank prices for materials used in the manufacture of lubricants. Several suppliers announced increases recently, with some saying they need better margins to help pay for new investments. One blamed its action in part on Hurricane Katrina.

Chemtura Corp. said it will raise global prices on phenolic antioxidants by 18 percent on Oct. 1 and that it will impose worldwide markups of 70 cents per kilogram on phosphorus-based lube additives and fire-resistant fluids on Oct. 15. Explaining the former hike, the Middlebury, Conn., company cited continued increases in costs for raw materials, energy and transportation. Management said it also acted to meet baseline profitability and an anticipated need for additional investment required to sustain these businesses.

In a separate announcement, Chemtura said it will impose an energy surcharge of 2 cents per pound, beginning Oct. 1, to offset higher costs for manufacturing and transportation. It plans to continue reviewing the need and size of the surcharge and may make adjustments when appropriate.

Albemarle Corp. also cited the need to invest, in announcing price increases of 5 percent to 20 percent on its antioxidants, including those formerly marketed under the HiTec brand name for use in lube and fuel additives. The increases take effect Oct. 1, the same day that the Richmond, Va., company begins selling those materials under the Ethanox brand name. HiTec is a trademark of Afton Chemical Co., and Albemarle had licensed its use after acquiring the product line from Afton last year.

Albemarle continues to support growing demand for these products, but we have experienced significant increases in raw materials, packaging materials and shipping costs, said John McChesney, Albemarles global business manager for antioxidants. The price increases allow continued investment in innovation, service, new capacity and products.

Dow Chemical said it will raise prices for UCon fluids and lubricants and for low-temperature thermal fluids partly because of Katrina.

We continue to experience an unprecedented escalation in raw material costs, Marketing Manager Pete Pendergast said. The devasting effects of Hurricane Katrina have put additional pressure on critical petrochemical feedstocks and energy prices. In addition, the disruption in the transportation infrastructure in the Gulf Coast has further tightened supply of key raw materials utilized to manufacture our products. We must implement these increases in order to offset the rising costs to manufacture and transport our products and remain a strong and reliable supplier.

Midland, Michigan-based Dow is hiking off-list prices of UCon products by 2 cents to 5 cents per pound. Off-list prices for low-temperature thermal fluids will rise 40 cents per gallon, except for DowFrost RV heat transfer fluid, which will go up 5 cents per pound. All increases take effect Oct. 15.

Separately, subsidiary Dow Biocides raised list and off-list prices for glutaraldehyde biocides by 5 percent, effective Sept. 1.

OM Group Inc. announced hikes of up to 20 percent on certain metal organic products, including some used in production of industrial lubricants. The company, which is based in Cleveland, cited sharp run-ups in costs for solvents, organic acids and additives, as well as hydrocarbon raw materials and freight.

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