My Turn – Commentary on Global Polyolefins and Elastomers –The Shift of Basic R&D to India and China – Dr. Balaji B. Singh
The polymer industry unanimously decided to shift the basic R&D functions to China and/or India. Both China and India, without a doubt, offer a better Intellectual capita/ R&D dollar.
The shift, last five years in the making is finally a reality. What does it mean to the U.S. organization’s basic R&D function??? Since the infrastructure for basic R&D is still in the process of moving, the basic R&D function will be stable, with no growth for a few more years. In the next five to ten years, most, if not all basic R&D will move along with Universities and the commercial R&D functions.
U.S. will remain the major basic R&D contributor in the world because of the U.S Government’s commitment to R&D.
The future of R&D in the U.S. will be driven by defense, medical, and space exploration. This factor universities and future polymer industry job seekers need to note.
Reliance and Dow in technical alliance for polypropylene unit
Reliance Petroleum (RPL) and Dow Global Technologies (DGTI) have signed a technical collaboration agreement for their new polypropylene plant. This could also have a catalyst plant along with a solvent extraction unit.
DGTI is a subsidiary of The Dow Chemical Company, which offers products and services in 175 countries across the world, helping them provide everything from fresh water, food, and pharmaceuticals to paints, packaging, and personal care products.
RPL is setting up a polypropylene plant at Jamnagar with a capacity of 900 KT per annum. The company has proposed an option of installing a catalyst plant and solvent recovery unit with an initial capacity of 100 tons per annum with a provision of expanding it to 300 tons per annum by adding two more plants. It has approvals for the proposed polypropylene plant. DGTI will offer UNIPOL-PP fluidized gas process technology, which is being used by the other two Reliance plants at Jamnagar and Hazira.
The 10-year deal with Midland-based DGTI will see a lump sum outgo of $26.55 million on technology for the plant, while the catalyst technology and solvent recovery unit will attract a fee of $14 million and $5.2 million respectively.
The payment schedule has been staggered into four equal parts, beginning with the first payment due on signing, followed by ones on delivery of the process design package, and the final commissioning of the plant.
The company had recently mobilized Rs 6,750 crore through a syndicated loan deal. RPL is also setting up a Rs 27,000-crore export-oriented refinery, with a capacity to process 5,80,000 barrels of crude per day.
Comments: Although not officially announced by both parties, such a partnership would certainly strengthen Reliance’s regional and global market position. Dow and Reliance have maintained a strong licensor-licensee relationship for quite some time now. Last October, Dow announced that Reliance had selected the Unipol PP process for its sixth PP plant, and the fourth line based on Dow’s technology. It is unclear if the mentioned catalyst plant pertains to the new line or will extend across all the licensed Unipol capacities. Please see our recently completed multi-client study on “Indian Commodity Plastics Industry – Opportunities and Strategies for Participation.
SABIC increases its stake in IBN ZAHR to 80%
Saudi Basic Industries Corporation (SABIC) signed an agreement, on March 26, 2006, to purchase NESTE Oil’s 10% stake in the Saudi European Petrochemical Company (IBN ZAHR). After the transaction, SABIC will own 80% of IBN ZAHR shares and the remaining shareholders, Apicorp and Ecofuel SpA, 10% each.
The deal, which is valued at $120 million, is expected to be closed during the second quarter of 2006. This agreement will further enhance SABIC’s overall operational results as IBN ZAHR is a well-run and highly profitable company and a leader in the production of MTBE and polypropylene.
Established in 1984, IBN ZAHR is SABIC’s first joint venture with European companies. Its complex in the Jubail Industrial City went on-stream in 1988 and later witnessed a number of expansion projects. Over the last few years, IBN ZAHR achieved the highest levels of production, exceeding designed capacities.
Comments: IBN ZAHR started operations in Jubail in 1988 with a 500 KT MTBE plant. The MTBE facility was expanded in 1993 and 1995 to 1,320 KT. In 1993, a 200 KT PP plant (PP1) based on Unipol technology was brought on-stream. The company added a second PP plant (PP2) with a capacity of 320 KT and debottlenecked PP1 in the early 2000s. Recently, the company announced that it would add 500 KT of PP capacity by mid-2008. Operationally, the company has done quite well, with most of its units running above their respective design capacities.
PetroChina to increase PP capacity by 2010
PetroChina announced its plans to become the world’s fifth-largest polypropylene (PP) producer by 2010. By that time period, the company will have more than doubled its existing capacity.
The Chinese oil, gas, and petrochemicals major produced 1.49 million metric tons of PP in 2005. This will rise to 3.05 million tons per year within the next three years.
Its large-scale PP projects will be at subsidiaries Dushanzi Petrochemical and Fushun Petrochemical, he added. In 2008, Dushanzi plans to produce 500-600 KT per year of PP and Fushun Petrochemical plans to build a 300,000-ton PP unit.
The company’s key problem was that most of its PP products are commodity plastics, which are uncompetitive when compared with high-performance materials, he added. General fiber PP makes up 55% of its production.
Comments: The above announcement is made by Dr. Jianjun Yi from PetroChina at our Flexpo 2006 conference in Singapore on March 14, 2006. For a copy of Dr. Yi’s presentation, please contact the CMR staff.
The two dominant Chinese petrochemical companies Sinopec and PetroChina have both made ambitious plans to expand their polyolefin capacities through 2010. At present, China needs to import around 40% of the PP demand and 50% of the PE demand. The import mainly comes from the Middle East and other Asian countries. The Middle East is also aggressively expanding its polyolefin capacities. If all the announced capacity comes on-stream as scheduled, the demand gap in China will be filled by domestic expansion and Middle Eastern capacities.
Basell starts new compounding plant in Brazil
Basell inaugurated its new polypropylene compounding plant in Pindamonhangaba, in the state of Sao Paulo, Brazil. The state-of-the-art plant’s current capacity is 35 KT and will be expanded in several phases to achieve the nameplate capacity of 80 KT.
The plant produces advanced polyolefin compounds based on polypropylene. Combining the cost-competitiveness of polyolefins with the performance of engineering resins, Basell’s compounded resins enable customers to produce value-added applications with exceptional properties such as high impact strength, excellent scratch resistance, superior paint adhesion, and low thermal expansion. In addition, Basell’s compounded resins can be easily tailored to meet a variety of demanding application needs, have outstanding processability, and can be recycled.
Basell, together with its joint ventures, now has a global PP compounding network that includes 14 countries. In addition to Brazil, Basell has compounding plants in Argentina, Australia, China, Germany, India, Japan, Korea, Malaysia, Spain, Taiwan, Thailand, the United Kingdom, and the United States.
Comments: Compounding enables Basell to participate in value-added applications and retain margins. Basell has compounding facilities in all the major regions of the world and this facility will enable the company to compete effectively in Latin America and other regions. Brazil is one of the countries projected to have high economic growth and its economic expansion will lead to an increased demand for compounded products in automotive and consumer goods markets. Automotive applications are one of the growth drivers for compounded polypropylene in emerging countries. The industry could see similar expansions or new facilities in countries such as India, China, Eastern Europe, and Russia.
Nova Innovene launches new grades of Zylar® & Dylark®
NOVA Innovene announced the introduction of NOVA Chemicals ZYLAR® EX 720 resins, the newest addition to the ZYLAR suite of clear acrylic copolymers.
According to the company, the new resins have outstanding shatter resistance and excellent aesthetics, ZYLAR EX resins are ideal for low-temperature food packaging.
With unmatched low-temperature toughness and excellent clarity, ZYLAR EX 720 is ideal for applications such as refrigerated or frozen food packaging. Uses for ZYLAR EX 720 include fresh fruit and produce containers, salad bowls and lids, cold beverage containers, deli trays, and frozen dessert packages. Other properties include: (1) improved processability, (2) greater throughput, and (3) reduced part weight.
NOVA Innovene also introduced NOVA Chemicals DYLARK® FG 2500, a high-heat copolymer for microwavable food packaging applications.
The newest addition to the DYLARK family of resins, DYLARK FG 2500 combines low-temperature toughness with high-temperature rigidity for superior freezer-to-microwave performance. Designed and developed to withstand broad temperature ranges, DYLARK FG 2500 is ideally suited for restaurant takeout containers, food service ware, and freezer-to-microwave meals.
For brand owners and food processors, DYLARK FG resins create new possibilities for product differentiation. DYLARK FG resins’ versatility offers the ability to design basic or intricate parts and it can be manufactured as tinted, clear, or foamed containers. FDA and EU Directive 2002/72 compliant, DYLARK FG resins have excellent organoleptics and are fully recyclable. For converters, DYLARK FG resins offer several processing advantages, such as faster cycle times, enhanced sealability, excellent printability, and higher material yields. Because DYLARK FG resins can be processed on existing polystyrene or PET equipment, converters have the opportunity to enter new segments of the food packaging industry.
Comments: Nova Chemical is the largest producer of Styrene methyl methacrylate (SMMA) in North America with their NAS and Zylar product range. SMMA resins mainly compete with polycarbonate in applications where clarity is critical. SMMA is positioned in the industry as a “poor man’s polycarbonate” due to the difference in pricing for both resins. Nova’s Zylar products are impact-modified SMMA and are most commonly used in applications such as hangers, displays, office accessories, small appliances, medical, CD Cases, toys, appliances, house-ware, and Personal care products. These applications require both clarity and impact resistance. The new product will allow Nova to increase its market share in appliances such as freezers, and refrigerators, and potential for other applications that require cold temperature resistance and clarity.
Dylark, resins that are based on SMA, are used for an application that requires high clarity. The major markets where SMA is used include (1) automotive for applications such as dashboard substrates, door panels, and controls (2) Consumer for applications such as pen barrels, beer mugs, plates, bowls, and water filter pitchers, (3) appliances for applications such as vacuum cleaner housings, doors for refrigerator compartments and jars for blenders food Another Unique Service From Chemical Market Resources, Inc. 560 Blossom Street, Ste C, Houston, TX 77598 USA; Tel: 281-557-3320 Email: POE-SNA@CMRHouTex.Com Copyright © 2006 Page 6/24of Issue 07 – Volume 4 processors, (4) office equipment for applications such as copier paper trays, computers, monitors and CD-ROM boxes (5) construction for applications such as bathroom fixtures, thermostat covers, faucet handles and (6) display for applications such as point of purchase, stands, racks, risers, card holders.
Petrobras plans to construct a chemical refinery near Rio de Janeiro
Petroleo Brasileiro SA, Brazil’s state-controlled oil company announced its plans to build a $6.5 billion petrochemical complex near Rio de Janeiro to help it process the rising output of heavy crude from offshore fields.
The new refinery, to be located in Itaborai, Brazil, will have the capacity to process 150,000 barrels of oil a day. The first phase of the project will produce 1.3 metric tons of ethane, 900,000 tons of propane, 360,000 tons of benzene, and 700,000 tons of polyethylene, and other oil derivatives.
The first phase, a basic petrochemical unit, will be built in partnership with Brazil’s BNDES state-development bank and require an investment of $3.5 billion.
Comments: Chemical Projects go through enormous cycles following the industry performance, but in recent years, fuel projects have maintained a steady emergence and growth due to the unabated appetite the world is seeing for refined and other fuel products. Don’t mistake that petrochemicals and feedstocks are very important but the worldwide refining shortage is a bigger cause to contend with and it is not surprising that Brazil, with a growing economy and improving standard of living that increases per capita fuels usages would put forth a major refining project at Itaborai of 150,000 Barrels per day.
In January, Brazil also announced a venture with PDVSA to build another joint venture refinery in Brazil of at least 200,000 BPD to be located in the northeast state of Pernambuco near the Venezuelan Orinoco oil belt.
Brazil is the 10th largest energy consumer in the world and the third largest in the Western Hemisphere following the US and Canada. Brazil is a net energy importer and consumes more than it produces in all energy inputs. Energy consumption is forecasted to increase at a rate of 3.3% per year through 2010. Brazil’s proven oil reserves are estimated as of 2005 at about 11 B barrels, the second greatest in South America after Venezuela. The most important reserves are located offshore in the Campos basin north of Rio de Janeiro. In spite of its wealth of oil reserves and a recent doubling of its annual oil production over the past decade, Brazil still imports 13% of the petroleum it consumes. The target is to reach energy self-sufficiency by the end of the decade and the two refining projects announced are a big step in this direction.
Air Products to sell its polymers business & restructure
Air Products announced a series of strategic initiatives to strengthen and expand its growth platforms, improve its return on capital, and return value to its shareholders.
The company is exploring the sale of its Amines and Polymers businesses, restructuring its Polyurethane Intermediates business, including plans to sell its dinitrotoluene (DNT) facility in Geismar, LA, for $155 million, and investing in its Performance Materials business with the $115 million acquisition of specialty surfactants producer Tomah Products. These actions will enable the company to further sharpen its focus on its four growth platforms: (1) Energy and Process Industries, (2) Electronics, (3) Homecare, and Performance Materials, and (4) its position in the Asia region. The company also is accelerating its return of cash to shareholders through a $1.5 billion share repurchase program and an increase in its quarterly dividend from $0.32 to $0.34.
The Amines business generated approximately $300 million in revenues in FY2005. Amines production facilities are located in Pace, Fla.; St. Gabriel, La.; and Camaçari, Brazil. The consolidated Air Products Polymers joint venture with Wacker Chemie AG of Germany had approximately $550 million in FY2005 revenues with six manufacturing facilities including South Brunswick, N.J.; Piedmont, S.C.; Calvert City, Ky.; Elkton, Md.; Ulsan, Korea; and Köln, Germany.
As part of its Polyurethane Intermediates business restructuring, Air Products announced that it has reached an agreement in principle to sell its DNT production facility in Geismar, LA, to BASF Corporation for $155 million.
Comments: Air Products formed two polymers joint ventures with Wacker Chemie in 2000. Air Products Polymers (65% Air Products & 35% Wacker) and Wacker Polymer Systems (20% Air Products and 80% Wacker) were the 2 JVs. These joint ventures are involved in the manufacture & sale of vinyl acetate-based redispersible powders, vinyl acetate copolymers, vinyl acetate-ethylene copolymers and others. The company’s polymer business is heavily dependent on vinyl acetate monomer as a raw material which is produced by its joint venture partner, Wacker Chemie.
This restructuring will help Air Products to focus on their core competencies – gases. These actions will make Air Products a more focused, reduced exposure to raw material volatility, less cyclical, and higher growth company. When these actions are completed, the company’s growth businesses will make up over 60% of its overall annual revenues compared to 35% in 2000.
Sinopec and Hindustan Petroleum sign joint agreement
Indian firm, Hindustan Petroleum and Sinopec announced that they have signed a preliminary agreement to jointly pursue projects in China, India, and elsewhere.
The companies say that the agreement covers petrochemicals, as well as consulting, exploration and production, refining, and trading.
Comments: With a combined population of 2.4 billion and fast-growing economies, China and India have become the epicenter of the flat globe. As global investors and multinational companies look for new opportunities, comparison between China and India has become a popular topic. In many people’s eyes, India will become a critical rival of China as its competitiveness improves. This is not necessarily true. India and China could become good partners in some areas as well. Recently, the two countries have already started some collaboration in seeking long-term energy supply. This announced alliance between Sinopec and Hindustan Petroleum again demonstrated the potential synergy between the industries of the two countries. The question that remains to be answered is: What the world is going to look like if the dragon and the tiger join hands?
In the last issue of our Next Generation Polyolefins (Vol. 11, Issue 1), we published an article “Plastics Industry: Indian vs. China”. Please contact CMR staff for a copy of the article. Some of the data were published in an interview with CMR by Plastics News in their online issue of March 22, 2006. Please follow the link to the interview, News analysis: Is India the next front-runner in plastics? The interview will soon appear in the hard copy of Plastics News as well.
Kraiburg introduces new TPE V
Kraiburg introduced its new TPE V product series at the First Automobile & Industry Customer Forum in Waldkraiburg on March 16 and 17, 2006.
The company announced that TPE V is now available on a production scale under the product name THERMOLAST V, with a Shore A hardness of 70. Shore A 50, 60, and 80 will be available in time for the autumn trade fair Fakuma 2006. The vulcanized materials, developed together with Kuraray, have pushed up the temperature limit required for the use of styrene block copolymers, which is approx. 120°C (248°F), thus providing an attractive alternative to EPDM/PP. According to the company, the benefits of the TPE Vs are that its mechanical, dynamic, and aging properties are superior to or at least identical to those of EPDM/PP.
The temperature range for their use is about 140°C (284°F) so this material extends the product portfolio for TPEs with usage temperatures above 125°C (257°F). Moreover, it also displays an excellent response to low temperatures, with a Tg of -64°C (-83°F). The new TPE Vs allow both injection molding and extrusion processing.
Comments: Kraiburg is one of the leading companies that develop compounds based on hydrogenated styrenic block copolymer. The company based in Europe caters to markets such as automotive, consumer care, toys, sports, appliances, electronics construction, and others. The company was formed in 1947 and started producing TPE in 1986 with an initial production capacity of 225 tons per annum. Currently, the company has TPE production plants in Europe and North America with over 30KT production capacity and 250 employees.
The latest new development by Kraiburg and Kuraray will allow higher heat-resistant based styrenic compounds to further penetrate markets such as under-the-hood automotive and other various applications where long-term heat resistance is required. The common hydrogenated SBC-based application in automotive applications includes seals, gaskets, acoustic barriers, and airbag applications. The high heat-resistant SEBS compound will allow Kraiburg to compete for a wider range of applications that traditionally use EPDM, TPO, and TPV.
DuPont to reduce jobs
DuPont announced its plans to eliminate 1,500 jobs, about 15% of its performance coatings workforce, and close manufacturing plants and labs within that business to improve profitability and competitiveness.
The restructuring plan will be implemented within the next 18 months, and will reduce annualized costs in that business by $165 million starting with $70 million in 2006, and about $100 million in 2007, DuPont says. The plan will result in a pre-tax charge of $165 million in its first-quarter accounts, as well as costs of up to $55 million during the next 12 months related to the plant closures, the company says.
The performance coatings business serves the automotive market, and the job cuts will mostly be in the OEM business, says DuPont chairman and CEO Charles Holliday. Most of the cuts and closures will take place in Europe. The company said that it will close coatings facilities at Rubi and Polinya, Spain; Breda, the Netherlands; and the Hellac Laboratory at Helmstedt, Germany. The workforce reduction is in addition to the 200 jobs DuPont will eliminate at its Troy, MI coatings lab, which will be consolidated into its Mt. Clemens, MI facility.
Separately, DuPont has raised its first-quarter and full-year 2006 earnings estimates, citing improved operating performance and successfully controlling fixed costs, partly offset by weaker market conditions in Europe and unfavorable currency trends. DuPont says it expects first-quarter earnings to be about 80 ¢/share, before significant items, up from its original estimate of 70 ¢/share, announced on January 24. The company also raised full-year estimates from $2.60/share to $2.70/share, before significant items.
Comments: The streamlining of operations in the chemical industry started a few years back and this trend is expected to continue. The industry is facing higher natural gas and crude oil prices, imported lower-cost finished goods from China, and the impact of cost-advantaged feedstock in the Middle East. In these conditions, companies have taken various steps to ensure profitability. These steps include moving operations to China, taking advantage of the Middle East feedstock position, shutting down inefficient manufacturing facilities, and operating efficiencies. DuPont’s plans to reduce jobs and close manufacturing plants and labs are a part of this larger trend in the industry.
Akzo Nobel and Solvay plead guilty to price-fixing charges
Solvay S.A. (Solvay) and Akzo Nobel Chemicals International B.V. have agreed to plead guilty and to pay a total of more than $72 million in criminal fines for their participation in international price-fixing cartels in the chemicals industry. These are the first charges as a result of the Department’s ongoing antitrust investigations into the hydrogen peroxide and sodium perborates industries.
Akzo Nobel has agreed to pay a $32 million criminal fine for participating in an international conspiracy to fix prices in the hydrogen peroxide market. Solvay has agreed to pay a $40.8 million criminal fine for participating in international conspiracies to fix prices in both the hydrogen peroxide and sodium perborates markets. Solvay and Akzo Nobel’s roles in the conspiracies affected nearly $350 million in United States commerce, the Department said.
Akzo Nobel and Solvay are charged with carrying out the hydrogen peroxide conspiracy with their co-conspirators by:
Participating & agreeing in conversations and meetings to discuss prices of hydrogen peroxide to be sold in the United States and elsewhere;
Issuing price announcements and price quotations in accordance with the agreements reached; and
Exchanging information on the sale of hydrogen peroxide in the United States and elsewhere.
Additionally, Solvay is charged with carrying out the sodium perborates conspiracy with its co-conspirator by:
Participating & agreeing in conversations and meetings to discuss prices of sodium perborates to be sold to Procter & Gamble;
Participating in conversations and attending meetings concerning implementation of and adherence to the agreements reached;
Issuing price quotations in accordance with the agreements reached;
and Exchanging information on the sale of sodium perborates to Procter & Gamble.
Comments: Visit our website http://cmrhoutex.com/commerce/misc/reports.jspand read article number 5 on U.S ANTI-TRUST REGULATIONS; ETHICAL COMPETITIVE BEHAVIOR – A PRIMER.
Department of Justice investigates possible price-fixing of polyurethane and related products
U.S. antitrust officials are probing possible anti-competitive activity in the market for polyurethane and related chemicals, the U.S. Justice Department and companies contacted in the probe said.
“The antitrust division is investigating the possibility of anti-competitive practices in the polyurethane industry,” Justice Department spokeswoman Gina Talamona said.
German chemical company BASF AG said its U.S. unit was among the companies being investigated. Bayer AG has already said it will pay a $33 million fine for U.S. antitrust violations relating to adipic-based polyester polyols.
Huntsman Corp. said in its annual report that it had been served with a grand jury subpoena requesting the production of documents relating to sales and pricing of TDI, MDI, polyether polyols, and “related systems.” Lyondell Chemical Co. said in its annual report that it had been contacted by the Justice Department in connection with the investigation. A representative of Dow Chemical Co. also reported to have been contacted by the Justice Department.
Sasol to finalize the sale of Condea by September 2006
Sasol announced that it expects to complete the sale of its subsidiary, Condea by September 2006.
Sasol would be issuing an information memorandum regarding the sale towards the end of March or in early April at which time the group would be seeking indicative bids.
The company said that it has received more than 40 expressions of interest from potential buyers of the company’s Condea olefins and surfactants (O&S) business. Sasol announced in 2005 that it plans to divest the R18-billion/year ($2.9 billion) O&S business, excluding alpha-olefins in South Africa.
Comments: In 2001, Sasol acquired Condea from the German firm RWE for about EUR1.3 billion. This was the largest acquisition for Sasol. Condea recorded a 2004 operating loss of EUR 8 M on turnover of EUR 2.1 billion of which 53% came from business in Europe and 33% came from business in North America.
The company announced in late 2005 that it was planning to sell Condea, its olefins & surfactants unit. Sasol will not include linear alpha olefins and solvents in the sale of its chemicals business. The decision to sell Condea was based on Sasol’s overall strategy to focus on GTL technologies. Sasol aims to reach 450,000 barrels per day of gas-to-liquids (GTL) production by 2014.
Sasol has held detailed negotiations with Iran’s state-owned National Petrochemical Co. (NPC) on building a GTL plant in the free trade zone in Assaluyeh, where Sasol and NPC are already constructing joint chemicals facilities. Gas for the GTL project has been linked to the Phase 14 development of the giant South Pars gas field, while the plant’s technology would again be based on Sasol’s Fischer-Tropsch process, already the basis for its schemes in Qatar and Nigeria.
Sasol is also working with Chevron in Australia to determine the commercial feasibility of a GTL project in the north of the country, starting production at a rate of 30,000-45,000 b/d, but growing in the next decade to over 200,000 b/d. These companies are also considering building a 34,000 b/d GTL plant in Arzew, Algeria where state-owned Sonatrach is looking to build a GTL plant using potential gas reserves in the Tinrhert area.
Degussa to decide by mid-year on China methacrylates investment
Degussa announced that the company will decide by mid-year on the site for a previously announced integrated methacrylates complex in China. The company’s “multi-user” site at Caojing, near Shanghai, is high on the list because the company has infrastructure there.
The project will be the largest single investment in Degussa’s EUR2.1-billion ($2.52 billion) capital expenditure planned for 2006-08. The core unit of the complex will be a methyl methacrylate (MMA) plant, with a capacity of about 100 KT per annum. That unit alone is expected to cost about $150 million, the company said previously. Downstream units will produce polymethyl methacrylate and binders for the coatings industry.
A previously announced oil additives plant, which Degussa is building in Singapore, will be supplied with methacrylates from the China complex. Degussa could use its traditional acetone and hydrogen cyanide-based process, or opt for a C4-based route.
Comments: Degussa’s decision to invest in the Asian region is in line with the other MMA producers. Last year, Lucite opened its first MMA facility in China. The company also formed an alliance in June 2005 with Mitsubishi Rayon to extend capacities by 260 KT per annum over the next 4 years. The project includes the construction of a factory in the US by Mitsubishi Rayon between 2005-2006 and another in Singapore by Lucite which should open in 2007. Lucite had been planning to build a 120 KT per annum unit in Singapore by itself.
Cargill starts commercial sales of biobased polyols for flexible urethane foams
Cargill announced that it is now selling commercial volumes of biobased polyols to large flexible polyurethane foam manufacturers in the automotive, furniture, and bedding industries, becoming the leading biobased polyol maker for the flexible foam market. Cargill’s technology has overcome the problems of consistency and odor that have plagued previous attempts by others at making biobased polyols for flexible foam.
Cargill’s biobased polyols for flexible foams – made through a proprietary process that can employ a number of natural oils, including linseed, rapeseed, soy, and sunflower — meet the technical requirements for commercial scale manufacturing processes. They become the first of what will be a line of Cargill biobased polyols across a range of urethane applications.
Designed to deliver performance as well as environmental advantages, Cargill’s biobased polyols give companies the ability to differentiate from their competitors and gain a degree of protection against the uncertainty of oil and natural gas supplies. Both were factors for the Woodbridge Group and Hickory Springs Manufacturing Company – two leading polyurethane foam manufacturers – in their decisions to use Cargill’s biobased polyols in their products.
Although Cargill currently has the capacity in place to handle large volume needs for several years, it is also preparing for the time when it will need to expand its capabilities across multiple global production facilities.
Comments: Cargill has been working on producing industrial chemicals from renewable resources for a long time now. The company went into a joint venture with Dow to produce polylactic acid and now owns the joint venture.
On June 16, 2003, Cargill Inc. and Pittsburg State University’s Kansas Polymer Research Center signed a license agreement to develop a line of soy polyol products. PSU-owned patents for transforming soybean oil to polyols were covered in the license agreement. The company had also received a grant from the Department of Energy to develop a platform of new industrial chemicals from soy and other oilseeds. The platform would serve as the foundation for an oilseed biorefinery in the future.
Part of the success of biobased polyols can be attributed to the significant price increases for crude oil and natural gas, their inherent volatility, and the uncertainty of supply.
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