Pöyry Complete Negotiations Regarding Restructuring of Forest Industry Business in Finland

The consulting and engineering group, Pöyry has announced that statutory employee negotiations, started in April in the Forest Industry business group's units based in Finland have been concluded. Due to the reorganisation the business group will permanently lay off about 100 people in Finland at this stage. The remaining staff in Pöyry Industry Oy, Finland, may be laid off temporarily until further notice. In addition, temporary lay-offs may lead to permanent lay-offs, affecting a maximum of 150 people. Part of the capacity reduction will be implemented through pension arrangements.

In 2009 restructuring took place in Sweden, North America and Russia with a reduction of about 200 people. The non-recurring cost of the retructuring is estimated to be EUR 2.5 million, which will be booked in the second-quarter results.

BASF to place Paper Chemicals HQ in Basel

BASF has announced that from July 1, 2009, BASFs Paper Chemicals operating division will be based in Basel together with two associated business units: Coatings & Starch Europe and Wet End Chemicals.  The cynic would say that this is another tax-dodging ruse followed by other companies such as Hercules and Clariant where repatriation to Switzerland has saved paying higher taxes in Europe; on the other hand, BASF had to make some promises to Ciba and Switzerland that in acquiring Ciba, some major businesses would remain in Switzerland.   Basel was the HQ for Ciba's paper business.

The details are available on the BASF web site including the overall plans for the Basel site - Research Centre; European Plastics and Additives Business Unit; and the Business Centre Switzerland.   

Sasol surprised by EU cartel fine

Sasol has issued a statement in response to the EU's fine of EUR 318,200,000 imposed on Sasol Wax GmbH and Sasol Limited as a result of the formation of a cartel in the paraffin wax industry and the violation of anti-trust laws.  As a reult of Sasol's co-operation with the EU Commission, the fine was reduced by 50%.

Sasol is surprised by the magintude of the fine and will lodge an appeal.

Paraffin waxes are used in paper coatings, barrier coatings, and other paper chemical formulations and have been under increasing scrutiny because of issues related to the recycling of paper and board containing waxes.

Nalco join wave of announcements on paper chemical price increases - Europe, Africa and Middle East

In yet another price increase announcement, Nalco Company has stated that it will immediately apply increases on a broad range of products for its Europe, Africa and Middle East customers across its three major divisions. 'Most increases will range from 7 to 30 percent, depending on the products' exposure to rising raw material, energy and transportation costs. In a few cases price increases in excess of 30 percent may apply.'

The price increases are driven by their increased energy and raw material costs, tightening availability of some raw materials, and rising freight costs.

False start for REACH as ECHA admit to computer problems

In a number of news reports (eg RSC), the problems experienced at The European Chemicals Agency (ECHA), have been highlighted. ECHA is responsible for running the European Union's new REACH scheme to regulate the use of chemicals, and it is clear that the agency is still struggling to put its IT system into full operation, more than two weeks after the start of the project's pre-registration period (1 June, 2008).

In May, Helsinki-based ECHA warned that it was having problems resolving teething problems with the system for bulk pre-registration of substances but it gave assurances that its IT facility would be working properly within a fortnight of the start of pre-registration.

The best advice is not to be first and to wait until things settle down before submitting your data - the ECHA organisation is new, REACH is new, so teething problems are to be expected.

Antitrust - EU Imposes Heavy Fines on Chlorate Cartel

The European Commission announced that it has imposed fines totalling over EUR 79 mio on four groups of companies for operating a cartel - fixing prices and allocating sales volumes of sodium chlorate. This chemical is mainly used in chemical pulp production where is used to produce the bleaching chemical, chlorine dioxide.

Some of the highlights are:

• The companies involved: EKA Chemicals, Akzo Nobel, Finnish Chemicals (now Kemira), Erikem Luxembourg, Arkema France, Elf Aquitaine, Aragonesas Industrias y Energia and Utralia.
• Period the cartel operated: 1994 - 2000
• Akzo Nobel and EKA Chemicals (subsidiary of Akzo Nobel) received full immunity from the fines as they were first to provide information about the cartel
• Finnish Chemicals (now Kemira) had its fine reduced by 50% for co-operating with the investigation
• The fine imposed on Arkema France was increased by 90% as it was a repeat offender - participated in 'three cartels before this one'

Full details of the fines and the rulings are available from the European Commission web site.

Keywords: Paper Chemicals, bleaching, chlorine dioxide, sodium chlorate, Canda International

Emulsion Polymers: Dow increases prices in Europe, Middle East, India and Africa

In yet another price increase announcement, Dow Emulsion Polymers stated that with immediate effect or as contracts allow, prices will be increased by € 280/MT (dry) for all styrene butadiene (S/B) latex based emulsion products sold into paper, carpet, and specialty applications in Europe, and up to $ 600/MT (dry) for S/Bs sold to Middle East, Africa and India. The increase is to help offset the rising costs of transportation, raw materials and energy.

REACH Registration begins .....................

Whatever your view of REACH:

• More Brussels bureaucracy
  
• Trade barrier
• The 'Green Agenda'
• A way to employ more people - especially consultants, governments, laboratories etc
  
• Public protection from nasty chemicals
• A tax on the chemical companies
• Restoring public confidence in chemicals
• etc, etc, etc
  

REACH is here to stay and the pre-registration 'marathon' starts today and lasts until 2018.

Further detailed information and a perspective is given by Chemie.DE News-Centre - the comments by Cefic are interesting.

For further details and assistance with REACH please contact Canda International.

SPCI 2008 - Feedback is mixed

Unable to participate in SPCI 2008, I contacted a number of people who were in Stockholm for the event and in summary:

• 'Surprised how few companies were exhibiting'
• 'The participation and dynamism of the events in South America, Asia and India just show how Europe is changing and becoming less important'
  
• 'Great to meet old friends, but there were fewer this year'
• 'Very expensive - the event, the hotels, the taxis ....'
• 'The discussions on energy and how to save costs were of value ...........'
  

Times are becoming harder and it is not surprising to find that companies are finding it difficult to pay for exhibition stands and for their employees to attend. From the attendance figures I have seen, SPCI 2008 did well to attract the participation that they did!

REACH - EU decide on charges for registration

The EU has given details of the fees and charges payable to the European Chemicals Agency (ECHA) for the registration of chemical substances (REACH) - the details are available in the wordy tome, the Official Journal of the European Union (Commission Regulation (EC) No 340/2008 of 16 April 2008).

The fees range from €1 600 for substances produced or imported in volumes below 10 tonnes, to €31 000 for those above 1 000 tonnes.

Help is offered to smaller businesses, with discounts of up to 90% for what is classed as a micro-enterprise; 60% for small-sized companies; and 30% for medium-sized firms (the definitions micro, small and medium are given in the EC regulation).

There is also a 25% reduction for companies which jointly regsiter.

REACH (Registration, Evaluation, Authorisation and Restriction of Chemical substances) requires that all substances manufactured or imported into the EU in quantities above one tonne per year be registered as from 1 June 2008.

For help with any aspect of REACH, especially for paper chemicals contact Canda International Ltd - importers into the EU or EU producers.

M-real pulls out of UK and sells New Thames mill to DS Smith

printweek.com has reported that M-real has withdrawn all production from the UK after agreeing to sell its New Thames office paper mill in Kemsley, Kent, to DS Smith for £60m.

At the end of 2008, the mill will stop producing paper for M-real and switch to producing, 'raw material for corrugated board'.

M-real had to make a decision as to whether to make a major investment in the older mill at New Thames or concentrate on newer mills elsewhere.

The New Thames mill paper machine currently has an annual capacity of 230,000 tonnes of office paper, employs 280 people and has sales of £119m (€160m).

Dow Chemical increases acylic acid and acrylate prices

Dow Chemical has announced price increases for acrylic acid and acrylates:
butyl acrylate, 2-ethylhexyl acrylate, ethyl acrylate, methyl acrylate and glacial acrylic acid globally as follows: North America by $0.03/lb; Asia Pacific by $70/tonne; Middle East/Africa by $70/tonne; Latin America by $70/tonne and Europe by Euro 50/tonne.

Finnish forestry companies developing Biofuel production

Just an update blog that is of interest. A summary is:

• Neste Oil and Stora Enso are planning to co-operate in the development of Biofuel.
• UPM Kymmene is to look for its own technical and business solutions and continuing its R&D activity (increased R&D spend from 50 to 80 million euro).

AAK acquire Ciba's de-inking chemical business

It was announced this morning that AarhusKarlshamn (AAK) will acquire Ciba Specialty Chemicals, Finland's de-inking chemicals unit. Ciba's Business Unit De-inking Chemicals has a turnover of SEK 25 millio and will become part of AAK's Business Sector Tefac (fatty acids).

Completion of the transaction is intended by the 31st October 2007.

Details given on AAK are as follows:

'AarhusKarlshamn is the world’s leading producer of high value-added speciality vegetable fats. These fats are characterized by a high technological content and are used as substitute for butter-fat and cocoa butter, transfree solutions for fillings in chocolate and confectionery products, and in the cosmetics industry. AarhusKarlshamn has production facilities in Denmark, Mexico, the Netherlands, Sweden, Great Britain, Uruguay and the US. The company is organised in three Business Areas; Chocolate and Confectionery Fats, Food Ingredients and Technical Products & Feed. Further information on AarhusKarlshamn can be found on the company’s website www.aak.com.'

BASF increase polymer emulsion and powder prices in Europe

BASF announced price increases for polymer emulsions and powders in Europe effective October 15 or as contracts allow.

• Polymer dispersions and additives will increase by €40 to €60 per metric ton
• Ploymer powders will increase by €80 to €100 per metric ton.
  

The reasons given for for these increases are increasing production and logistic costs.

Clariant closes world-class OBA team in the UK

In continuing its cost-cutting programme, Clariant has closed its world-class, global optical brightener (OBA) activities in Horsforth, Leeds, England. The activities have been moved to Switzerland but the key people have decided not to go. The head of the global business and the UK team has now left Clariant to establish his own company, Makowhiteness, and will continue to offer expertise to the industry. Despite efforts to justify the move, it is clear that it will be many years before the team and its expertise will be re-produced and re-established in Switzerland.

OBA is one of the two key areas of paper chemical business for Clariant, the other being paper dyes. Optical brightening agents or fluorescent whitening agens as they are otherwise known are used to improve the whiteness of paper, especially the high-whiteness fine papers used in offices (eg copier paper). The main users of OBAs are International Paper, StoraEnso, UPM Kymmene, New Page, Domtar, Sappi, m-real etc.

BASF raises prices for sizing agents and colourants

BASF has announced that with effect from the 1st October, 2007 (as contracts allow), prices for sizing agents and paper colourants will increase by 20%.

The increases affect Europe, the Middle East and Africa.

The justification is based on raw material cost increases for products based on ethylene, propylene, fatty alcohols and acids, naphthalene, aniline and amines where costs have been driven upwards by high crude oil prices and energy costs. There is also the recent changes in tax refunds for export business from China combined with a Chinese environmental protection programme which have lead to a reduced supply of key raw materials and an increase in prices for intermediates.

This is yet another announcement by paper chemical suppliers which have struggled to realise price increases in line with increasing raw material costs.

Finnish government reduce ownership in Kemira - Oras Invest become major shareholder

The Republic of Finland today sold 40,097,420 shares of Kemira Oyj and as a result its share capital and voting rights in Kemira Oyj has decreased to 16.52%.

The buyers were Oras Invest Oy, Varma Mutual Pension Insurance Company and Ilmarinen Mutual Pension Insurance Company. This results in Kemira’s main shareholder being the Finnish, family-owned company, Oras Invest Oy and its owners, members of the Paasikivi family. Oras now owns 17.1 per cent of Kemira’s share capital (see announcement).

The split of the Finnish government shares was as follows:

• Oras Invest Oy 15.60% (share capital and voting rights): 19,507,020 shares. This addition took their total share capital and voting rights to 17.1%.
  
• The Republic of Finland 16.52% (share capital and voting rights): 20,656,500 shares
• Varma Mutual Pension Insurance Company 9.6% (9.71% share capital and voting rights): 12,144,862 shares
  
• Ilmarinen Mutual Pension Insurance Company 5.3% (5.32% share capital and voting rights): 6,657,796 shares
• Kemira Oyj's share capital comprises 125,045,000 shares which carry a total of 125,045,000 votes.

For the full announcement, see the Kemira web site.

REACH for the negative press ........

The reach weblog has collected together a number of negative press reviews on the new European legislation. Could we ever have expected the bureaucrats and European government agencies to develop and implement this complex regulation in any other way? Expect the EU to put a different spin on the situation.

Further evidence of decline in UK newspaper readership

With the trend to declining readership of newspapers, the UK's publishers are looking to on-line audiences to grow circulation figures. In an interesting article by printweek.com , information is given on the Audit Bureau of Circulations (ABC) figures for July, listing the online and print audiences of newspapers side by side with the on-line readership figures:

• For the newspapers: The Guardian had an average daily circulation of 362,309 and its Sunday sister The Observer had an average weekly circulation of 445,162.

• Meanwhile on-line, Guardian Unlimited drew an average of 830,361 unique visitors every day (16,058,979 for the month); The Mail Online was in second place with 11,865,039 unique visitors/month; Times Online with 10,536,915/month; the Sun Online with 9,435,509/month; and Telegraph.co.uk with 8,992,526/month
  

The article goes on to show how recent newspaper circulation shows decline across the entire paid-for market, with newspapers introducing free editions showing the only gains.