Breaking News Roundup

07 June 2004 00:01  [Source: ICB Americas]

Dow to Close Epoxy Resins Plant

Dow Chemical Company will close its Sarnia, Ontario, Canada, plant for solid epoxy resins and Derakane epoxy vinyl ester resins on August 1. Recognizing the need for consolidation, the company looked at all of its epoxy plants and determined the Sarnia plant was “underutilized,” according to Patrick Ho, business vice president for epoxy products and intermediates. “We took into account our global supply chain, production levels for each plant, access to raw materials and other factors. Based on that review, we came to the difficult decision that we need to close the Sarnia epoxy facility,” he says. The Sarnia plant produces roughly 3,500 metric tons per year of D.E.R. solid epoxy resins and 2,000 metric tons per year of Derakane.

Oil Pricing Eases After Hitting a Record

Oil continues to hover around $40 per barrel in the wake of unrest in the Middle East. Oil briefly shot above $42 following an attack in Saudi Arabia that killed 22 people, including 19 foreigners, in compounds housing oil workers. Pricing then eased by around $2 as the Organization of the Petroleum Exporting Countries promised to raise its output by an additional 500,000 barrels per day (b/d) to a group output limit of 25.5 million b/d, starting in August. Saudi Arabia sought an increase of 2.5 million b/d, but Iran and Venezuela called for a smaller increase, fearing a collapse in oil prices.

Tate & Lyle to Expand Sucralose Plant

Tate & Lyle will invest £16 million ($30 million) to expand its sucralose plant in McIntosh, Ala. The project will employ the company’s patented manufacturing process and will be completed by January 2006. In April, Tate & Lyle completed a realignment of its sucralose pacts with McNeil Nutritionals, making Tate & Lyle the sole manufacturer of the sugar substitute and giving it responsibility for global ingredient sales of Splenda sucralose to food and beverage makers. “We have been delighted by the strong customer-led demand for Splenda sucralose since we completed the sucralose realignment in April,” says CEO Iain Ferguson.

Cargill and CIE Form Ethanol Alliance

Cargill Inc. has formed a strategic alliance with Central Illinois Energy (CIE) to sell and distribute the latter’s 36 million gallons of yearly ethanol production. In addition to finding markets for CIE-produced ethanol, Cargill will provide the farmer-owned CIE with other services including corn buying and, through its wholly owned subsidiary, commodity futures advisory services. “By combining our marketing and supply-chain expertise with the manufacturing know-how of organizations like CIE, major refiners and gasoline blenders can be assured that their ethanol needs will be met in all market conditions,” says Brian Silvey, manager of Cargill’s ethanol and fermentation business.

Lubrizol Completes Noveon Purchase and Restructures

Lubrizol Corp. has completed its $1.84 billion acquisition of Noveon International Inc., which will become a wholly owned subsidiary of Lubrizol. The company’s combined pro forma revenues were $3.2 billion in 2003, and $900 million in the first quarter of 2004. Lubrizol also announced a redesigned organizational structure consisting of two operating segments, Lubrizol Additives and Noveon. Lubrizol Additives’ responsibilities include additives for engine oils, driveline fluids, industrial fluids, fuels, emulsified products and advanced fluid systems, while Noveon’s include additives and specialty resins for coatings and inks, ingredients for personal care products, additives for foam control and other process chemicals.

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