Diesel costs continue to fuel US TiO2 surcharges

04 October 2008 00:13  [Source: ICIS news]

HOUSTON (ICIS news)--Energy surcharges announced this week by two major titanium dioxide (TiO2) producers is indicative of a tight diesel supply that has propped up fuel costs, a source said on Friday.

Tronox and DuPont each announced energy surcharges of 4 cents/lb ($88/tonne) this week for titanium dioxide (TiO2) sold into North America's paper market.
Tronox, the third largest US manufacturer of the white pigment, which is used in coatings, plastics, cosmetics and paper products, said the surcharge would be effective on 15 October.

Oklahoma-based Tronox previously announced a 4 cent/lb surcharge effective 1 July and a 6 cent/lb surcharge for 1 August.

DuPont's surcharge is effective on 1 November.

Diesel and gasoline prices have dropped in recent weeks, but gasoline more precipitously than diesel, which remains at relatively high levels compared with those in previous years, despite declining futures pricing.

The US Energy Information Administration (EIA) said on Friday that average retail diesel prices were up 91.1 cents year-over-year.

Contract prices for North American TiO2 were 104-114 cents/lb ($2,293-2,513/tonne, €1,650-1,809/tonne) according to global chemical market intelligence service ICIS pricing.

But further price increases of 5-11 cents/lb are being negotiated, buyers and sellers said this week.

Other US TiO2 producers include Cristal, Huntsman and Kronos.

($1 = €0.72)

For more on TiO2, visit ICIS chemical intelligence
To discuss issues facing the chemical industry, go to ICIS connect

By: Larry Terry
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