Saltigo says climbing raw materials, energy and shipping costs prompted it to increase the price of key chemical intermediates, 1,2,4-triazole and chloroformate.
The German firm increased what it charges for the two intermediates – which are used in the production of active pharmaceutical ingredients (API) – by 10 to 20 per cent across the board on January 1.
Saltigo explained that: “The reasons for the measure are increases in raw material, energy and logistic costs,” adding that it reflects the “continued increase in operational costs associated with the safe production.”
The price hike comes just months after Saltigo’s owner –chemicals firm Lanxess AG – reported a 9 per cent increase in revenue generated by its advanced intermediates business for fiscal 2012, citing “higher selling prices, positive volumes and currency effects” as key drivers.
Earnings generated by the intermediates unit – which comprises Saltigo and Lanxess’ Industrial intermediates division - also increased 10 per cent to €70m driven mainly due to higher demand from the agrochemicals sector.
Despite the increase in raw materials costs, Saltigo clearly thinks there is potential for growth in the chloroformate market.
Spokesman Tony Jones said: “Saltigo intends to further develop and strengthen its presence in the important chloroformate market employing its expertise and knowledge of this demanding and challenging chemistry.
The comments echo those of owner Lanxess earlier this week when said a newly secured, long-term €1.25bn credit facility will be used as a financial back up for its growth strategy.