ExxonMobil Chemical develops a new cost-effective PE resin for wire and cable applications
ExxonMobil Chemical announced a new linear low-density polyethylene (LLDPE) resin, LL 4004EL, for low-voltage power cable insulations. According to the company, the resin provides the cable manufacturer with a balance of crosslinking speed and ease of processing for cost-competitive cable constructions.
ExxonMobil LL 4004EL resin has been field-tested for two years and is suitable for processing in both one-step (Monosil) and two-step (Sioplas) process technology. ExxonMobil Chemical LDPE and LLDPE grades have been used successfully for more than 15 years in wire and cable Silane Technology. Continual quality testing, along with controlled shipping logistics, ensures uniform, consistent products. Wire and cable manufacturers will benefit from the increased efficiency of their cable productions.
Comments: Silane technology uses a siloxane ridge to link polyethylene molecules together. The first step involves the grafting of the silane compound onto the polymer chain to form the vinyl silane copolymer. Organic peroxide agents are typically used to initiate the reaction at elevated temperatures to form the polymeric free radicals as in the peroxide method. The silane moiety may be grafted in situ or post-reactor. The major processes for manufacturing silane-crosslinked polyethylene include (1) Sioplas, (2) Monosil, and (3) Reactor Copolymers. The Sioplas method, developed by Dow Corning, involves grafting vinyltrialkoxysilane onto the polyethylene backbone. The grafted polymer is shipped to the processor where it is blended with a catalyst/additives masterbatch plus peroxide. The blend is extruded onto wire & cable or into pipe or tubing. The extrudate is subsequently subjected to heat and moisture to complete the crosslinking reaction. Dibutyltin dilaurate (DBTDL) is a typical catalyst. The heating step is effected through a (1) hot-water batch or (2) steam treatment. Sioplas is the most prevalently used silane-based process in North America. Crosslinked polyethylene is used as insulation material in the following wire & cable applications: (1) Low voltage (less than 600 volts), (2) Medium/High voltage (600+ volts), and (3) Automotive. Low voltage wire applications include wiring and distribution for office buildings and factories, the bulk of it for indoor applications.
The major technical requirements for this application include (1) tree resistance, (2) low dielectric constant, (3) high power factor, (4) low dissipation factor, (5) UV resistance, (6) temperature resistance, (7) processability, (8) flexibility, (9) breakage/crack resistance, (10) filler acceptance, (11) low gel, and (12) consistency.
Crosslinked polyethylene competes with PVC, TPEs, EP(D)M, EVA, C(S)PE, and other insulating materials in wire & cable applications. In North America, the wire & cable resin business has been dominated by Dow (former Union Carbide). Other players include ExxonMobil, Equistar (the result of acquisition from AT Plastics), and DuPont Dow.
PolyOne sells its cross-linked PE – Syncure business to Padanaplast USA Inc.
PolyOne Corp. announced its plans to sell its Syncure-brand cross-linked polyethylene business to Padanaplast USA Inc. of Sheboygan, WI. The Syncure business produces cross-linked polyethylene-based compounds in Valleyfield. PolyOne acquired the business in 1998 as part of its purchase of Synergistics Inc.
According to the deal, Padanaplast will acquire machinery and inventory and will lease the 25-employee site from PolyOne. Padanaplast employs 42 and operates four extrusion lines at a 60,000-square-foot plant in Sheboygan.
Comments: Crosslinked Polyethylene (XLPE) is widely used in end-use applications which include (1) Wire & Cable (insulating material), (2) Foam (sporting goods, automotive, medical, and industrial among others), (3) Rotomolding (fuel and chemical storage tanks), (4) Constructions (radiant heating & fluid transport) and others. XLPE offers improved heat and oil resistance over regular polyethylene, XLPE is beneficial in applications like wire and cable which require excellent high-temperature performance along with good creep and stress-crack resistance.
The global demand for XLPE in 2003 was 2,055 million pounds with North America and Europe accounting for 65% of the global demand. Crosslinking can be achieved by processes that include (1) Irradiation, (2) Peroxide, and (3) Silane. Peroxide crosslinking is the preferred method in North America. LDPE is the preferred base resin in North America and accounted for 55% of the North American demand in 2003.
PolyOne offers Syncure® Concentrates for automotive wire and cable applications and SyncureTM XLPE Compounds which is a silane-grafted, moisture cross-linkable polyethylene. These materials are made utilizing the Sioplas E two-step technology.
Padanaplast which is no longer associated with Italian compounder, Padanaplast SpA focuses on XLPE compounds for the wire and cable market.
Westlake announces 2003 fourth-quarter earnings
Westlake Chemical Corporation reported 2003 fourth-quarter net sales of $365.9 million, net income of $10.1 million, and adjusted EBITDA of $47.1 million. Net sales, net income, and adjusted EBITDA compare favorably to net sales of $282.0 million, a net loss of $3.4 million, and adjusted EBITDA of $21.5 million for the fourth quarter of 2002.
In the Olefins segment, the income from operations increased by $16.3 million to $17.7 million in the fourth quarter of 2003 from $1.4 million in the fourth quarter of 2002. This increase was primarily due to higher selling prices and higher sales volumes in polyethylene and styrene, which were partially offset by higher feedstock and energy costs and lower ethylene production volumes.
In the Vinyls segment, fourth quarter income from operations was $4.8 million, as compared to a loss from operations of $0.4 million in the fourth quarter of 2002. This increase was due to higher selling prices for PVC pipe, PVC resin, and VCM and higher sales volumes for PVC pipe and PVC resin. These increases were partially offset by higher raw material and energy costs.
Comments: Westlake is a producer of ethylene, polyethylene, styrene, vinyl chloride monomer, and PVC resins. In the olefins segment, the company produces polyethylene and styrene monomer. Westlake Polymers began low-density polyethylene production in 1986 with a capacity of 220 million pounds per year which was then expanded in 1988 to 750 million pounds and in 1993 to 850 million pounds per year. One tubular and four autoclave reactors are used in the manufacturing process. The company then started a new LLDPE plant at the same facility utilizing BP’s Innovene® gas phase process. The older LDPE facility was then shut down.
Westlake produces PVC at its facility located in Calvert City, KY, which the company acquired from Air Products in 1991. The company is upward integrated in the production of raw materials for the production of PVC – vinyl chloride monomer and chlorine.
Tecnimont awarded polyolefin contracts in China, Russia, and Saudi Arabia
Tecnimont announced that it has received contracts to build polyolefin plants from PetroChina, NPC, and Salavatnefteorgsintez.
PetroChina awarded a contract to Tecnimont for a 200,000 MT/year low-density polyethylene (PE) plant in Lanzhou, China. The plant will use Basell’s Lupotech T technology and will be completed in 2006. The total investment cost is estimated at $100 million.
Tecnimont also signed a $215-million lump-sum engineering, procurement, and construction contract with National Petrochemical (Yanbu, Saudi Arabia) for the construction of a polypropylene (PP) plant at Yanbu. The unit will use Basell’s Spheripol technology to produce 400,000-420,000 MT/year of PP. Completion is scheduled within 28 months.
Separately, Tecnimont won an $80-million contract from Salavatnefteorgsintez (Salavat, Russia) to build a 120,000 MT/year high-density PE plant at Salavat. The plant will use Basell’s Hostalen technology and is scheduled for completion in 2006.
Comments: Tecnimont is a major engineering and construction company that operates globally in the area of chemicals, petrochemicals, oil & gas, energy, and other sectors of the process plant industry. Tecnimont was established in 1973 as a spin-off of the engineering division of Montedison. The company inherited extensive experience and capabilities from the founders of Montedison, Montecatini, and Edison, who pioneered the development of the Italian chemical, petrochemical, and energy industries.
Tecnimont has implemented over 100 plants globally for the production of polypropylene (PP) and polyethylene (PE) out of which 18 of them are in the People’s Republic of China. The company in the past 5 years has installed close to 8 million MT/year capacity covering a 22% share of the world PP and PE market.
PetroChina was established in 1999 as a part of the restructuring of China National Petroleum Corporation (CNPC). The company is one of the major producers of polyethylene in China. The company operates its chemical plants including polyethylene plants through its operating companies including (1) Jilin Petrochemical, (2) Lanzhou Petrochemical, (3) Fushun Petrochemical, (4) Liaoyang Petrochemical, (5) Daqing Refining, (6) Dushanzi Petrochemical, (7) Urumqi Petrochemical, and (8) Ningxia Petrochemical.
National Petrochemical is the subsidiary of the Iranian Petroleum Ministry owned by the government. The company has several operating companies including (1) Arak Petrochemical, (2) Bandar Imam Petrochemical, (3) Esfahan Petrochemical, (4) Kharg Petrochemical, (5) Khorasan Petrochemical, (6) Orumiyeh Petrochemical, (7) Razi Petrochemical, (8) Shiraz Petrochemical, and (9) Tabriz Petrochemical.
Honam restarts the HDPE plant
Honam Petrochemical announced that it restarted a high-density polyethylene (HDPE) plant at Yeochon, Korea that was damaged by a fatal explosion and fire in 2003.
Comments: Honam Petrochemical has 365 KT of HDPE capacity based on Mitsui technology in Yeochon. Honam Petrochemical accounts for almost 20% of the HDPE capacity in South Korea. Other major HDPE producers in South Korea include (1) Daelim, (2) Hyundai, (3) KPIC, (4) LG, (5) Samsung, and (6) SK Corporation. The total HDPE capacity in South Korea is approximately 1,950 KT.
The reduction in output caused due to the explosion in the Honam plant did not have a major impact on the supply of HDPE.
Indian Oil Corp. selects site for its PP plant
Indian Oil Corporation (IOC) announced that it has selected Panipat in Haryana, India, as the location for its proposed 350,000-400,000 MT/year polypropylene (PP) unit. The project will source propylene feedstock from IOC’s refineries.
The company was previously considering three sites for the project — Mathura in Uttar Pradesh, Baroda in Gujarat, and Chennai in Tamil Nadu.
The detailed feasibility study will start after IOC has conducted a review of scoping studies on revamping fluid catalytic cracking (FCC) units at IOC’s refineries in Panipat and Mathura to deep catalytic cracking (DCC) units, which can give higher propylene yields than FCC units.
As Mathura and Panipat are near each other, propylene from a DCC unit in Mathura could easily be transported to the PP project in Panipat.
Part of the propylene feedstock could also come from a refinery expansion at IOC’s subsidiary, Chennai Petroleum Corp. The expansion, when completed at the end of next month, will increase the refinery’s propylene capacity from 17,000 MT/year to 80,000-90,000 MT/year.
Comments: The total demand for polypropylene in India in is around 1,180 KT. The major markets for polypropylene in India include (1) injection molding, (2) woven sacks, (3) BOPP Film and others. Injection molding and woven sacks are the two largest end-use markets for polypropylene in India accounting for 31% and 30% of the total polypropylene demand respectively.
The projected growth rate for polypropylene in India is 13.7% annually, reaching 2,277 KT by 2007. Injection molding is the fastest-growing market with a projected growth rate of 17.5% annually. All other markets are also projected to experience robust double-digit growth.
The total capacity for polypropylene in India is around 1,185 KT. The major suppliers of polypropylene in India include (1) Haldia Petrochemicals, (2) IPCL, and (3) Reliance Industries. Reliance Industries is by far the biggest supplier of polypropylene in India with a total capacity of 800 KT.
IOC will be a new entrant in the polypropylene market in India. The reasons for IOC entering the polypropylene market seem to be two-fold: (1) to take advantage of this fast-growing market where demand seems to be outpacing capacity and (2) to provide an outlet for its propylene. IOC was a government-owned corporation focused on the upstream industry (mainly refining). In recent years the government has divested many of the companies in this sector and this has led to changes in corporate strategy. IOC seems to be moving down the value chain in an attempt to expand its operations and capture value while increasing its competitiveness in domestic markets.
Thai PTT considers a joint venture with two petrochemical units
Thai PTT has announced its plans to conduct a feasibility study to decide whether to produce polypropylene and polyethylene through a joint venture with its two petrochemical units. The company plans to complete the study by June 2004.
The new joint venture will likely be formed with National Petrochemical PCL and Thai Olefins PCL. According to the company, the polypropylene production capacity would be around 300,000 MT/year.
PTT signed a memorandum of understanding with National Petrochemical, Thai Olefins, and Aromatics (Thailand) PCL to set up the country’s first phenol production plant, with a combined investment worth $200 million. The plant will have a phenol production capacity of 200,000 metric tons a year and will start operations in the second quarter of 2007.
Comments: Thailand’s state-owned company Petroleum Authority of Thailand (PTT) was formed in 1978 to manage and maintain its fully integrated petroleum industry which includes exploration, purchase, transportation, refining, distribution, restoration, and downstream trading.
PTT holds a 37 percent stake in National Petrochemical (NPC) and owns 49 percent of Thai Olefins (TOC). NPC has an ethylene production capacity of 473KT and a propylene capacity of 173KT. TOC, Thailand’s second olefins plant, produces ethylene, propylene, pyrolysis gasoline, and Mixed C4. Thai Olefins produces 385,000 MT/year of ethylene and 190,000 MT/year of propylene.
Kuwait and Egypt Plan $1-billion olefins complex in Egypt
According to the Egyptian government, Kuwait and Egypt are planning to build a new olefin complex in Egypt.
The two countries are considering the construction of an olefins complex worth at least $ 1 billion, in Egypt. Kuwaiti and Egyptian oil officials have been discussing a proposed project to pipe Egyptian gas to Kuwait in exchange for crude oil to be processed in Egyptian refineries.
Comments: The Egyptian government has restructured the petroleum sector in order to cope with the expanding activities of oil, gas, and petrochemicals and support the decision-making process and improve the petroleum sector’s capabilities. The government established the Egyptian Petrochemical Holding Company (ECAM) to promote investment in petrochemicals, facilitate the development of new projects and establish and own petrochemical plants.
The privately held companies in Egypt are also investing in the construction of the Olefins complex. In 2003, the Egyptian Arab Trading Company (Eatco) launched a $1.4 billion polyolefins project. The company will construct a methanol-to-olefins (MTO) complex which would then produce several downstream products.
There is abundant availability of natural gas in Egypt while there is availability of crude oil in Kuwait. Hence the two governments are considering the construction of an olefins complex whereby both countries will benefit from the availability of cheaper feedstock.
Mitsui Chemicals begins TPO production in Germany
Mitsui Chemicals started production of Milastomer, an olefin thermoplastic elastomer (TPO). It has installed a facility capable of producing several thousand tons annually at a local company in Germany. Mitsui plans to supply the output primarily to the automotive sector.
Comments: Mitsui Chemicals’ decision to start a production facility for TPO in Europe is in response to healthy market conditions and Mitsui’s strategy to increase participation in the propylene chain and other higher value-added products. Demand for TPO products is being driven primarily by automotive applications, where this material satisfies performance demands as well as recyclability issues. The initial use of TPOs in automotive was limited to bumper applications. With improvements in technology, TPOs have started to make inroads into interior applications. In recent years, automotive skin applications have experienced higher growth at lower base volumes. This application mainly requires soft TPOs with Shore A at or around 55.
Court vindicates vinyl-related conspiracy charges
The Superior Court of Delaware found no basis for conspiracy charges related to vinyl plastic manufacturing brought against the American Chemistry Council (ACC) and 30 other industry defendants.
Former polyvinyl chloride pipe factory worker Lori Sanzone claimed that the industry covered up the dangers of vinyl chloride. Her ordeal with cancer had been featured in a widely circulated anti-vinyl-industry documentary, “Blue Vinyl.”
According to ACC Senior Counsel Don Evans, Sanzone had worked for seven days in 1978 in a Florida PVC pipe plant and claimed that she contracted angiosarcoma as a result. He says she suffered from epithelioid hemangioendothelioma, a disease linked to birth control pills, and not angiosarcoma.
Ms. Sanzone asserted that she contracted angiosarcoma, a rare form of liver cancer, after working seven days in 1978 at a Florida pipe-making plant that used PVC. She sued the ACC and 30 other entities that were either suppliers or simply involved in the industry during the past half-century.
His film, Blue Vinyl, won a cinematography award for documentaries at the 2002 Sundance Film Festival. It was produced by Toxic Comedy Pictures (New York), which is linked to an advocacy group that conducts anti-PVC campaigns.
Vinyl Institute objects to Greenpeace’s “PVC-free” habitat house
Vinyl industry (VI) has been involved via the Vinyl Institute trade group, with Habitat, a nonprofit organization that builds houses affordable to low-income people. Vinyl Institute has donated materials worth more than $1.3 million over the last ten years.
VI expressed its strong objection to Greenpeace’s strident language. Per the mission of Habitat, Greenpeace should talk about the materials being used for construction rather than the ones not being used. VI claims to share a professional and personal commitment with Habitat and would like them to warn Greenpeace of their inappropriate language. VI has worked on construction projects in Louisiana with Habitat, in the past and plans for more in 2005.
Comments: Don’t miss the special session on “A decade of polyolefins related developments in PVC issues and opportunities” during our upcoming FlexPO2004 conference on Sept 15-17, 2004.
We will discuss: (1) A decade of polyolefin activities in PVC-related markets and issues, (2) a review of the recent PVC replacement economics study conducted by Tufts University, and (3) an update on Vinyl Institute activities.
The session will be followed by a panel discussion. We strongly believe PVC is a versatile polymer and cannot/should not be replaced. Future development should focus more on optimizing the polymer combinations. – What do you think? Come and express your opinions freely!
PVC producer EVC International announces 2003 results – sixth successive loss
EVC International N.V. (EVC), Europe’s largest PVC manufacturer, announced its full-year results for the year ended 31 December 2003. The company posted an operating loss of EUR 3.6 million, compared to EUR 13.7 million in 2002, and a net loss of EUR 25.6 million (2002: EUR 40.1 million).
The company attributed its loss to the difficult trading conditions in 2003 for the European PVC market and reduced PVC prices.
Comments: EVC International is one of the leading producers of PVC in Europe. The company has PVC plants located in several locations based on suspension & emulsion processes including (1) Schkopau, Germany (315 KT, suspension/emulsion process), (2) Wilhelmshaven, Germany (320 KT, suspension/emulsion process), (3) Porto Marghera, Italy(180 KT, suspension), (4) Porto Torres, Italy (90 KT, suspension), (5) Ravenna, Italy (200 KT, suspension), (6) Barry, UK (125 KT, suspension), (7) Fleetwood, UK (45 suspensions), and (8) Runcorn, UK (115 KT, suspension).
The demand for PVC in Europe is expected to grow at about 1-2% per annum for the next five years. Environmental pressures have had a negative impact on PVC consumption as compared to other developed regions of the world.
Chlorine industry denies toxic mercury release from mercury cell chloralkali facilities
The chlorine industry has denied claims by environmental groups that mercury cell chloralkali facilities pose a threat to public health by releasing tons of unreported toxic mercury into the air every year.
The Natural Resources Defense Council (NRDC) and the Sierra Club filed a lawsuit against Environmental Protection Agency’s (EPA) new emission reduction rules for mercury cell chloralkali plants. The groups claim that the new rules violate the Clean Air Act by “ignoring tons of unaccounted-for mercury emissions each year.” According to the groups, there are 9 US plants using mercury cell technology to produce chlorine and caustic soda. These plants were unable to account for 65 tons of mercury in 2000.
However, according to Chlorine Institute, there is no study or scientific basis for the assertion that the difference between the amounts of mercury the industry purchases on an annual basis and the amount it cannot account for equates to unreported releases to the environment. The industry believes the “unaccounted” mercury is material that remains in the tens of thousands of cubic feet of pipes, tanks, and other process equipment on plant sites.
PolyOne introduces Maxxam® LST compounds using nano clay technology
PolyOne Corporation introduced Maxxam® LST compounds, nano clay-based compounds that offer a combination of light, stiff and tough attributes.
According to the company, Maxxam® LST compounds are easy-to-use, high-performance compounds offering processing advantages that are inherent to polyolefins. The several properties of these products include (1) low specific gravity, (2) “thin-wall” capabilities, (3) dimensional stability, (4) high strength & toughness, and others. Maxxam® LST compounds are an extension of PolyOne’s Nanoblend™ Concentrates, a family of high-performance materials based on nanocomposite technology.
In addition to their high strength and toughness – at a lighter weight – Maxxam® LST compounds offer a number of other benefits including processability, glass fiber reduction, aesthetics, chemical resistance, and recyclability. Compared with many other engineered materials, for example, Maxxam® LST compounds require lower processing temperatures, flow easier and cool faster. As a result, with Maxxam® LST compounds, customers often use less material, improve cycle times, and lower their energy and equipment costs.
Typical applications include (1) Interior and exterior trim in the transportation industry, (2) Appliance and power tool housings, (3) Packaging liners, containers, and closures, (4) Pipe, conduit, fittings, and fascia used in construction, and (5) Consumer goods.
PolyOne has been aligned with Nanocor Inc., the world’s leading manufacturer of nano clays, since January 2003. Maxxam® LST compounds are patent-pending by PolyOne.
Comments: Nanocomposites are hybrid materials, filled with nanoclays, exhibiting enhanced mechanical, barrier, and flame retarding properties. Relatively small amounts (2-5%) of the nanometer-sized clays impart large property improvements to the resins while maintaining their specific gravity.
Dispersion of the clay particles at a nanoscale enables better interaction of the polymer and the clay, thus resulting in enhanced properties. These materials are used in automotive, packaging, electrical, and flame retardant applications.
PolyOne formed a strategic alliance in January 2003 with Arlington Heights, Illinois-based Nanocor Inc., the largest supplier of nano clays for plastics and a wholly owned subsidiary of AMCOL International Corp. Under this agreement, PolyOne markets and manufactures nano clay-based concentrates and compounds, while sharing research and development responsibilities with Nanocor. Nanoblend™ concentrates, containing 40% nanoclays were the first group of nanomaterials commercialized by PolyOne in June 2003. This material primarily targets fire retardant applications, both halogen, and non-halogen, and is available for polypropylene and polyethylene resins. The potential use of Nanoblend concentrates in film, medical equipment, and wire and cable applications is being evaluated. With Maxxam LST™, PolyOne extends its line of nanocomposites to transportation, packaging, and construction applications. The light, stiff, and tough performance of these materials competes with that of traditional materials like ABS, PC/ABS, and PBT. PolyOne uses a patented process to achieve effective exfoliation of the nano clay platelets, which is critical for maximum performance. The company hopes to lead the market through the application of nanocomposites to solve customers’ needs.
The critical issues related to nanotechnology and its impact on the polyolefins industry will be thoroughly examined at the upcoming FLEXPO2004conference to be held in Galveston, TX on September 15-17, 2004
Pactiv announces new productivity plan and cost reductions & grows its Hefty® consumer-products business
Pactiv Corporation announced its plans to make substantial improvements in its productivity and cost structure and reinvest a portion of the savings to build upon its already successful sales growth efforts. The plan is designed to consolidate certain manufacturing facilities and eliminate excess capacity and low value-added activities. The Company expects to reduce annualized pretax costs by approximately $45 million ($28 million after-tax). Approximately $25 million of the savings will be allocated to marketing support and new product development activities.
The plan includes the rationalization of inefficient manufacturing assets, primarily certain molded fiber facilities in North America and Europe, as well as reducing overhead in several areas of the business. The majority of the plan will be implemented in the second quarter of 2004, with some carryover into the second half.
The company intends to grow its higher-margin Hefty consumer-products business. About $25 million of the expected savings will go for marketing in the Hefty business. That operation includes extruded plastic bags and disposable plates.
Comments: Pactiv, like many other companies in this sector, is facing stiff competition from the influx of cheaper Chinese bags. The temporary tariffs imposed on bags coming from the Far East will provide some relief to domestic producers; however, the overall economic conditions and increasing costs have affected the margins significantly. These new productivity and cost reduction plans should help Pactiv maintain its competitiveness in the North American markets.
In 1998 Tenneco Packaging and Sentinel Products formed a 50-50 joint venture called Sentinel Polyolefins LLC. When the joint venture was formed Tenneco Packaging was part of Tenneco Inc. In November 1999 Tenneco Inc. spun off its packaging division and formed two companies namely, (1) Tenneco Automotive and (2) Tenneco Packaging. Subsequently, Tenneco Packaging changed its name to Pactiv. The Hefty brand name bags used to be a part of Mobil films.
Select introduces new thermoformable elastomeric polyolefin foam, MicroFlex®
Hyannis, MA-based Cellect introduced a new family of thermoformable elastomeric polyolefin foam called MicroFlex®. According to the company, the product offers users cost savings, improvements in physical properties, and flexibility in fabrication techniques. Microflex is a closed-cell EPDM based on polyolefin and produced in a bun or block form. The company claims that the material has a high coefficient of friction, a soft-touch feel, and is compressible yet tough and resilient, making it a good choice for automotive and industrial gaskets, sealing, and vibration-dampening applications.
Comments: Polyolefin foams can be broadly classified into the following categories (1) Non-Crosslinked Polyethylene Foams, (2) Crosslinked Polyethylene Foams, (3) EPP/EPE Bead Foams, (4) Polypropylene Foams, and (5) EVA Based Foams. The total demand for polyolefin-based foams in North America in 2003 was 400 MM Lbs with the non-crosslinked and crosslinked polyethylene foams accounting for close to 75% of the North American demand.
Cellect LLC was formed in early 2001 and specializes in the manufacture of specialty polyolefin bun foams for use in a myriad of industrial and consumer markets. These markets include medical and healthcare, gaskets and seals, automotive and transportation, building and construction, toys, and military and electronics packaging.
Microflex foams based on EPDM complement Cellect’s current product offering which includes (1) SSP® – Crosslinked polyethylene packaging foams, (2) MicroCell® – Crosslinked polyolefin foams, (3) EvaCell™ – Crosslinked EVA foams and (4) OpFlex® – Opencell crosslinked polyolefin foams.
Thermoplastic composites address the automotive recycling issue
A UK research project has developed thermoplastic composites for the automotive industry that are strong and easy to recycle.
The two-year project led by Warwick University produced composites using PP and PET reinforced with long fibers of glass and carbon.
According to the leader of the Advanced Polymeric Composite Panels with Low Environmental Impact (Apple) project, the new products are very tough, and due to the presence of a thermoplastic matrix, the products can be shredded, and recycled.
The EU end-of-life-vehicles (ELV) directive is putting the automotive industry under pressure to recycle more components. Researchers have molded automotive parts using a modified vacuum-forming machine and silicone molding methods.
Comments: Increasing environmental concerns and legislative agendas imposed in some parts of the world drive the growth of plastics waste recycling into resins or chemicals. More companies are directing efforts to reclaim and reuse plastic materials from the end products. Efforts to collect and recycle all types of plastic packaging have also been initiated. Plastic recycling is essential to comply with regulations and achieve high environmental performance.
There is a growing move in the automotive industry towards the reuse and reprocessing of plastics for both economic and environmental reasons. About 14 million motor vehicles are scrapped in the EU (European Union) each year, representing an enormous waste problem. About 25% of a car is composed of plastics, rubber, and other components, which are currently disposed of in a landfill. Therefore, there is a need to identify novel process routes to enable the recycling of composite materials, particularly in light of the European Union End of Life Vehicle (ELV) Directive (2000), which requires Member States of the EU to reuse and recover 85 wt% of the average vehicle weight by 2006, increasing to 95 wt% by 2015.
In response to these regulations, Dupont Engineering Polymers developed the Dupont composite recycling technology that converts parts made of glass or mineral-filled nylon into the resin by dissolving the used material and filtering away contaminants. Toyota Motor Corp. recently confirmed the feasibility of this technology by testing the reuse of nylon-6 from their automotive air intake manifolds. Research developments with respect to thermoplastic composites further help in overcoming the recycling issue.
Emerald Packaging Inc buys Bemis’ Union City site
Emerald Packaging Inc announced that it has purchased an additional site located in Union City, CA for manufacturing and warehousing for $5.8 million. The site contains two new buildings and formerly housed a Bemis Co. Inc. extruded film operation.
Emerald will maintain its Union City, CA, headquarters site and use the new location for its first foray into film extrusion. Emerald Packaging manufacturers produce packaging for Dole, Grimway Farms, and Salad Time Farms.
The film division of Minneapolis-based Bemis used the site to make monolayer extruded polyethylene film. Bemis closed the operation in September and put it up for sale.
Comments: Emerald Packaging is one of the major packaging manufacturers in North America. The company has annual sales of about $20-25 million. The company has been growing slowly by expanding. In 1999, the company expanded its facility by 30,000 square feet in Union City, CA.
Producers use Emerald’s output principally to bag fresh fruits and vegetables. Key California customers include Tanimura & Antle and Dole Food Co.’s fresh vegetables division, both of Salinas and Grimmway Farms of Bakersfield. Emerald also supplies distributor C&L Container of Monte Vista, Colo., with clear PE packaging for as many as 20 potato farmers.
H.B. Fuller buys adhesives and resins businesses of Probos SA
H.B. Fuller Company acquired the adhesives and resins businesses of Probos SA, based in Oporto, Portugal. The Probos businesses have combined annual sales of roughly $30 million and primarily serve the Iberian Peninsula. They will be incorporated into H.B. Fuller’s European operations.
The acquired product lines include water-based, hot melt, reactive and solvent-based adhesives for the assembly, woodworking, footwear, and converting industries, and emulsions for the paints, textiles, and food product industries. The PVC/ABS edges and PE foam businesses are not included in the acquisition.
Comments: H.B. Fuller Company, based in Saint Paul, MN is a worldwide manufacturer and marketer of adhesives for packaging, construction, bookbinding, wood bonding, furniture, and automotive among other applications.
Probos has been the long-time exclusive licensee of the Rakoll® woodworking brand for H.B. Fuller in the Portuguese market. Rakoll® woodworking adhesives business was acquired by H.B. Fuller in 1982. This business of H.B. Fuller offers three distinct product line which includes (1) Emulsion Adhesives – sheet and veneer applications, solid wood, assembly, adhesives for waterproof bonding, etc. Emulsion adhesives are polyvinyl acetate (PVAC) based products, (2) Hot Melt Adhesives – hot melt adhesives for bonding a wide range of materials at straight edges, profile wrapping, etc. Hot melt adhesives are generally EVA, polyamide, polyolefins, and polyurethane-based products, and (3) Membrane Press Adhesives – polyurethane-based emulsion adhesives for membrane press bonding.
US plastic industry trade deficits on the rise
The trade deficit of the U.S. plastics processing industry doubled to $2.1 billion in 2003. China’s growth in its trade surplus with the U.S. by $400 million accounted for 40% of the U.S. deficit. Deficits with Canada grew by $130 million and with Germany by $120 million. Surpluses with Mexico and Brazil shrank by $115 million and $70 million respectively. While China accounted for the majority of the increase in deficits in commodity products, Canada accounted for building products and plastic crates. Resin producers, however, experienced a surplus rise of 3% to &7.3 billion. Trade deficits for molds rose from $360 million in 2001 to $660 million in 2003. The figures were similar for plastics equipment with the deficits doubling from $420 million in 2001 to 820 in 2003. The deficits in Germany, France, and Canada increased by $76 million, $63 million, and $37 million respectively, in this segment.
A drastic change from a trade surplus of $1.1 billion in 2000 to a deficit of more than 100% over the previous year in 2003 calls for close observation. Factors including global competition, currency pegs, energy prices, and sputtering manufacturing economies worsened the country’s trade relationships with Canada, China, and Mexico. China poses a major problem to the U.S. economy with the policy of pegging its currency to the dollar. Higher resin prices in Asia also cause damage to the North American industry. Despite the deficit increases, plastics still fare better than other segments of the chemical industry on a global stage, as they are less energy-intensive and more value-added.
Comments: As the trend towards globalization continues its impact is felt in a variety of ways. Trade deficits are just one of the derivatives of globalization among others such as shifts in jobs, manufacturing sites, and changes in currency rates.
Doubling trade deficits in a year implies that the United States has been importing plastics at a much higher rate than it is exporting. The impact of cheaper Chinese goods is apparent as China accounts for 40% of this increasing deficit.
There was a surplus in trade at the resin level which indicates that there is an influx of cheaper finished goods though the resin is shipped from the US to other regions. Resin Suppliers will continue to evaluate the situation and form strategies to maintain profitability in evolving global markets. As these trends continue resin producers will have to monitor the value chain on a global basis. The profitability at different levels across the value chain will differ by region and it might be cheaper to buy the feedstock from one region, produce the resins in a different region, convert the resins elsewhere, and produce the final product in yet another region.
In current conditions, competitive advantage for suppliers can emerge from in-depth knowledge of global value chains, logistics, and regional industry dynamics.
Teijin Chemicals to construct polycarbonate plant in China
Teijin Chemicals has established a wholly owned production and sales company in Jiaxing, Zhejiang Province. The company has started the construction of a 50,000 MT/year PC plant scheduled for completion at the end of 2004. The plant will be located in Jiaxing, China.
Teijin Chemicals plans to double the plant capacity by 2006 to 100,000 MT/year. The second PC train at Jiaxing was originally scheduled to start up in 2007, but this will now occur in 2006. The raw material will be supplied by Mitsui Chemicals.
Comments: The major applications for polycarbonate include: (1) automobiles, (2) electronics/electrical, (3) CD/DVDs, (4) glazing & roofing systems, and several others. The demand for polycarbonate in China is expected to grow tremendously at double-digit figures between 10-12% per annum for the next five years. In order to meet the rapidly growing demand several companies, both domestic and foreign have invested in the construction of new capacities for polycarbonate. Bayer is constructing a 200 KT PC plant in China scheduled for completion in 2006.
Specialty chemicals producer Noveon International files for IPO
Noveon International Inc, a producer of specialty chemicals will once again attempt an initial public offering (IPO). Their goal is to raise $345 million in funds. Noveon had tried going public once before, in July 2002, but the company withdrew its initial registration statement in May 2003.
Credit Suisse First Boston, Deutsche Bank Securities, and UBS Securities LLC will be the joint book-running managers for the offering. Goldman, Sachs & Co. and Merrill Lynch & Co. will serve as co-managers. The number of shares to be offered and the price range for the offering have not yet been determined.
Comments: Noveon is the former Goodrich specialty chemicals business that was acquired in 2001 by private equity firm AEA Investors, DLJ Merchant Banking, and the private equity arm of Deutsche Bank. Noveon is one of the largest manufacturers of specialty chemicals. Its product portfolio consists of three major segments including (1) consumer specialties, (2) specialty materials, and (3) performance coatings. Its consumer specialties unit consists of chemicals for the personal care, pharmaceutical, and food and beverage industries. Key products include acrylic thickeners, emollients, silicones, botanicals, active pharmaceutical ingredients, fragrances, synthetic food dyes, and natural colorants.
The company is one of the leading suppliers of CPVC (chlorinated polyvinyl chloride) resins and compounds, TPU (thermoplastic polyurethane), and RLP (reactive liquid polymers). The company produces and markets its products under several trade names such as Estane®, Estaloc®, EstaGrip®, Blazemaster®, and others. Under its performance coatings segment, the company produces acrylic, polyurethane dispersions.
Noveon filed for an IPO in July 2003 but had to withdraw its IPO plans in July 2003 due to weak economic conditions.
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