US-based Cabot has decided to stop carbon black production at its Port Dickson, Malaysia, facility by the end of July 2013. Customer shipments from the plant are expected to continue for a period of time after production has been shut down. Cabot holds a 51% equity share in the plant.
The decision, which will affect approximately 90 carbon black employees, was because of the facility’s manufacturing inefficiencies and raw materials costs. Cabot says it remains committed to engaging with customers currently served from the Port Dickson plant to determine how best to meet their needs during and after the shutdown of Malaysian production. The closure of the plant is expected to result in one-time cash and non-cash charges to the joint venture of approximately US$13 million and US$15 million, respectively. Annual savings for the joint venture are estimated to be approximately us$7 million.