Raws moderate in Europe, but labour tensions a concern – A Schulman

25 October 2010 16:47  [Source: ICIS news]

HOUSTON (ICIS)--European raw material prices are finally moderating, but labour tensions in the region bring uncertainty to the outlook, US-based compounder A Schulman said on Monday.

While raw material costs in the Americas and Asia fell around mid-year, European costs held firm, company officials said on a conference call with investors.

“We are concerned about the European situation,” said chief executive Joseph Gingo, referring to the recent strikes that have affected various industries in France.

“Any disruption causes a ripple effect. ... If it is sustained over a long period of time, I’m convinced it will have an effect across all of Europe,” he said.

Gingo spoke on a conference call for fiscal fourth-quarter earnings. Earlier Monday, A Schulman reported that it more than doubled its fourth-quarter net income to $11.7m.

A Schulman said nylon and titanium dioxide (TiO2) prices were very high in Europe because of tight supply and strong demand.

The compounder said nylon supply was loosening around the world, but noted that TiO2 remained tight.

“We’re taking every step we can to make sure we have a steady flow of TiO2, but we think for the remainder of the calendar year, TiO2 will be tight on pricing,” Gingo said.

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By: David Barry
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