Cabot will implement a feedstock surcharge for all specialty carbon black products manufactured in North America as a result of new low sulfur fuel regulations. A surcharge of USD 0.07/pound will be effective 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
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.
New Rule to Bring Long-term Benefits
“
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,” said Jay Doubman, senior vice president and president, Performance Additives. “
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.
Source: Cabot