The Trouble With Prices

July 10, 2006 - Washington DC

From Chemical & Engineering News, p. 56

by Marc Reisch

When representatives from nine chemical-related enterprises gathered in Philadelphia for the third year in a row to speak to industry analysts, they weren't chomping at the bit, eagerly anticipating business growth and profits as their counterparts were just a year ago.

Instead, many of the speakers at the 3rd Annual Chemical Industry Conference, held late last month under the auspices of the Chemical Heritage Foundation, talked about the difficulties they are experiencing maintaining profit margins as they try to pass on energy and raw material price increases to their customers. The firms they represented were Nalco, RPM International, Airgas, Lubrizol, Rohm and Haas, Dow Chemical, H.B. Fuller, Cytec Industries, and Compass Minerals International.

Prospects for the industry were brighter at the time of last year's conference. Many speakers hoped then to make hay while the sun was shining, but as it turned out, rain clouds moved in as the year progressed...

Some companies at the Chemical Heritage Foundation conference saw the current round of raw material price increases as more of an opportunity than a challenge. For instance, John A. Feenan, senior vice president and chief financial officer of adhesives and sealants maker H.B. Fuller, admitted that by passing along price increases to its customers, the company had also succeeded in expanding gross margins over the past few months...

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