Grace Announces Surcharge on FCC SOx Reduction Additives

COLUMBIA, Md., April 26, 2018 -- W. R. Grace & Co. (NYSE:GRA) will institute a surcharge of $0.35 per pound ($0.77 per kilogram) on the price of its sulfur oxides (SOx) reduction additives used in Fluid Catalytic Cracking (FCC) units. This price adjustment will offset recent increases in the cost of vanadium and will be effective immediately as contracts allow.

Source: London Metal Bulletin

Vanadium is a key raw material in the manufacture of FCC SOx reduction additives. Decreased supply, caused by recent U.S. sanctions on Russia and increased environmental restrictions in China, coupled with increased demand for ferrovanadium for steel production, have combined to create rapidly escalating vanadium prices. The London Metal Bulletin index for V2O5 (vanadium), which, historically, has been in the range of $4-6 per pound, exceeded $15 per pound in March 2018. Consequently, Grace has experienced a significant increase in the production costs for Super DESOX® and Super DESOX® OCI additives. While Grace has secured vanadium supply to ensure no supply disruptions to our customers, a surcharge is necessary to offset the increased vanadium cost and to support Grace’s ongoing development of next-generation products, enhanced technical services, and increased manufacturing capabilities to serve our global customers.

Grace will implement this surcharge based on the V2O5 market pricing in the London Metal Bulletin, the vanadium content of our products, and the cost premiums associated with converting vanadium raw materials to the compounds used in these products. The current index level of $15 per pound will result in a price increase of $0.35 per pound ($0.77 per kilogram) for both Super DESOX^® and Super DESOX^® OCI. Grace will review and adjust this surcharge quarterly.

About Grace

Built on talent, technology, and trust, Grace is a leading global supplier of catalysts and engineered materials. The company’s two industry-leading business segments—Catalysts Technologies and Materials Technologies—provide innovative products, technologies, and services that enhance the products and processes of its customers around the world. With approximately 3,900 employees, Grace operates and/or sells to customers in over 60 countries. More information about Grace is available at grace.com.

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