FLORHAM PARK, NJ — Citing increases in feedstock and energy costs, BASF announced yesterday it is increasing prices for its entire product line in North America in order to address the rising costs it continues to experience in North America.
“We’ve taken significant actions over the last few years to drive down costs under our control in order to mitigate the effects of rising feedstock and energy prices during that period,” said Klaus Peter Loebbe, BASF chairman and CEO. “In light of the continuing and unparalleled increases, these price actions are necessary to maintain a healthy business and to continue to meet our customers’ supply requirements.”
Although the effects of recent hurricanes have exacerbated raw material and energy costs, the company said it believes the continuing imbalance in supply and demand for petroleum based materials, especially natural gas, to be the major driver of the present situation in North America. Since 2003, prices for crude oil and natural gas have increased roughly threefold and fivefold, respectively, with no signs of moving back down. These increases have put enormous pressure on margins in the chemical industry where pricing has not kept pace, BASF stated.
“Energy conservation alone cannot adequately address the widening gap between available supply and the market demand for petroleum feed stocks, especially for natural gas, a key raw material for the chemical industry,” said Joe Breunig, president for BASF’s Chemicals, Plastics and Coatings businesses in North America. “A comprehensive approach to energy management that includes development can, however, help to stabilize feedstock and energy pricing and strengthen the chemical industry in the region.
The company said it is communicating directly with its customers about these price actions.
For more information about BASF, go to: www.basf.com/usa.
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