Wilmington, DL, September 13, 2005--DuPont said it plans to raise prices for all of its products in response to rapidly increasing costs for energy and feedstocks.
The chemical giant cited a report by DuPont corporate economist Robert Shrouds indicating that record-high energy prices, further exacerbated by Hurricane Katrina, will be a factor for the foreseeable future.
Diane Gulyas, DuPont's chief marketing officer, said the company expects all of its 80 business units to be affected by higher energy costs, especially its performance materials and coatings and color technologies divisions, but that it's too soon to tell how high product prices will go.
"We have not narrowed down any specific ranges we can share with you at this time," she said Monday.
According to the DuPont report, crude oil prices for 2006 are expected to be above 2005's average price of $59 a barrel, which represented a 44 percent jump over the 2004 average of $41 a barrel.
The report also noted that U.S. natural gas prices have doubled in the past year, and were driven even higher by Hurricane Katrina, which Gulyas said "exacerbated an already difficult natural gas situation."
"We believe these new high levels of energy are here to stay," she said, noting the increased demand for oil and gas from China, India and other developing economies.
The company said a $10 increase in the price of a barrel of oil increases variable costs to the U.S. chemical industry by about $2.6 billion per year, while a $1 increase per million BTU in natural gas prices increases variable costs by $3.7 billion per year.
