Lhoist has announced an energy surcharge via a letter to its customers. The letter reads:
Dear Valued Customer,
Lhoist is committed to providing cost-effective, reliable supply of quality products to our valued customers. We have continued to do this while experiencing cost increases and supply challenges over the past year. A significant impact has been the cost of energy for the production of our products and for the materials required by businesses in all industries.
As a result, Lhoist is implementing an Energy Surcharge on all lime products effective Nov. 1, 2021 and continuing until circumstances warrant otherwise.
Lhoist’s Energy Surcharge will be based on the Henry Hub published natural gas prices, which are readily available at https://www.eia.gov/dnav/ng/hist/rngwhhdM.htm, and will operate as follows:
The base and floor price will be $2.60 per mmbtu (Henry Hub published price for November 2020), and will be adjusted monthly.
Effective Nov. 1, 2021, the Energy Surcharge for the current calendar month will be based on the most recent available Henry Hub monthly average published price as of the 15th day of the previous calendar month. (For example, if on Oct. 15, 2021 the most recent available Henry Hub monthly average published price is for the month of September 2021, then the surcharge for November 2021 will be adjusted based on that September 2021 published monthly average price.)
The Energy Surcharge will be $0.20 per ton of lime for each $0.05 of natural gas price above $2.60 per mmbtu.
We regret having to implement this Energy Surcharge, but believe it necessary in the face of these energy related cost increases. Additionally, please note that this surcharge is independent of and in addition to 2022 price increases that will be necessary for Lhoist to keep pace with general inflationary factors impacting its cost structure.
We appreciate your business and cooperation during this difficult time. If you have any questions regarding the above, feel free to contact your Lhoist sales representative.
Lhoist North America is a subsidiary of the Lhoist Group. Formed through a series of investments and acquisitions that span more than three decades, LNA has become a premier supplier of lime, limestone and other mineral products in the North American marketplace. LNA employs 1,500 people at more than 50 facilities throughout the United States and Canada.