How a Contract Round Becomes a Plant Closure

In May 2018 Cabot put the tonnage in the headline: "Cabot Corporation to Expand Global Carbon Black Capacity by over 300,000 Metric Tons." 160,000 metric tons at Cilegon in Indonesia, another 150,000 debottlenecked across eighteen plants, taking the network to roughly 2.5 million metric tons.

Monday night it went the other way, and there is no number.

Cabot's fiscal third quarter landed after the close with an effective tax rate of 79% against an operating rate of 31%. The gap is a $19 million discrete charge, and the reason given for it is a valuation allowance change "as a result of the Company ceasing carbon black production at its plant in Campana, Argentina."

That is the first time a Cabot results release has named the site. It arrived in the tax paragraph.

"What does a supplier with fewer plants do to a contract you renew every January?"

The volume came back and the money didn't

Reinforcement Materials opened fiscal 2026 with a volume problem. December-quarter volumes fell 7%, the Americas alone down 15%, and segment EBIT dropped $28 million to $102 million.

Cabot blamed lower production and year-end inventory management by its tire customers, plus competitive intensity in Asia.

Then the volume came back. Up 3% in the March quarter, up 5% in the June quarter, with Asia Pacific up 10%.

Earnings kept falling anyway (chart below). March quarter EBIT $93 million, June quarter $97 million against $128 million a year earlier.

The company's own attribution moved with it. In May the cause was "lower pricing and product mix in our calendar year 2026 tire customer agreements."

On Monday it was "the outcomes of our calendar year 2026 customer agreements."

Nine months in, the segment has earned $292 million against $389 million, down 24.9%, on sales down 6.5%. Sell more, earn a quarter less.