Songwon eyes major revenue boost

By Robert Grace
Associate Publisher & Business Development Director

Published: October 18, 2013 1:47 pm ET
Updated: October 19, 2013 6:50 am ET

Image By: Robert Grace Jongho Park and Maurizio Butti

Related to this story

Topics Materials, Materials Suppliers, Asia, K 2013, Business News & Features

DÜSSELDORF, GERMANY — As part of its strategy to grow revenues by a third to $900 million by 2015, South Korean additives maker Songwon Industrial Co. Ltd. (Hall 6/C79) rolled out a new line of polymer stabilizers, showcased its latest distribution partner and provided an update on its various international expansion plans.

One might scoff at such a bold revenue prediction, except that it is in line with Songwon's performance in recent years. Founded in 1965, sales for the publicly held firm grew by more than 150 percent from 2005-2012, and reached 680 billion Korean won ($634 million) in fiscal 2012, according to Chief Operating Officer Maurizio Butti. It reported operating profit of KRW 57.6 billion ($53.7 million) last year.

The company announced its new line of SongXtend stabilizers Oct. 18 at K 2013 in Düsseldorf. The two general-purpose packages — SongXtend 1101 and SongXtend 1102 — are said to allow poly¬propylene producers and processors to maintain high-temperature manufacturing while safeguarding the polymer's desired properties such as high heat stability. Three other new stabilizer packages target the auto industry and are designed to address fogging and odor issues in car interiors. SongXtend 2121 reduces sulphur by 60 percent, the 2122 grade reduces sulphur by 30 percent, and 2123 is sulphur-free.

Butti also used the K event to introduce the company's newest distribution partner, Italy's Sabo SpA, a privately held, $165 million firm that is the world's second-largest maker of hindered amine light stabilizers. HALS are light-stabilizing additives for polyolefins. Songwon will supply Sabo's products via its global network.

Sabo CEO Germano Peverelli told attendees that his firm doubled capacity this month for its Sabo Stab UV 119 additive, and also recently agreed to license Chimassorb 2020 technology from BASF. Sabo will commercialize Chimassorb 2020 under the brand name Sabo Stab UV 40, which is said to combine exceptionally high UV and long-term thermal stability.

Meantime, Songwon continues its aggressive push with "one-pack systems" — products that combine a variety of complex additives into an integrated, dust-free pellet form that can be custom formulated. It offered no such products as recently as 2011, but now has 14,000 metric tons of annual one-pack system (OPS) production capacity worldwide, and plans to boost that to 40,000 tonnes by 2015, Butti said.

He went on to give updates on some of the company's previously announced global investments:

• It will break ground on its new OPS plant in Abu Dhabi next month, with the aim of bringing it on stream in the third quarter of 2014. That plant involves an investment of $15 million to $20 million.

• Songwon's expansion of OPS capacity in Greiz, Germany, was implemented this past July, via the implementation of new production technology.

• Retrofitting of new improved technology will allow the firm to bring an additional 5,000 tonnes of new polymer stabilizer capacity on stream in January 2014.

• It also can add another 8,000 to 10,000 tonnes through changes to the manufacturing structure, without the addition of new capital.

• In the area of non-polymer stabilizers, Songwon also recently brought on stream, in the second half of 2013, new capacity to make diocytl tin oxide.

In a post-conference interview, Butti said that to be successful in China, "you need to be local" with a physical plant. Songwon is selling in China now and has great interest in the market, but other initiatives are taking priority.

Similarly, he said the firm has no clear plan now for expansion in South America. OPS production there "could make sense," he acknowledged, but the market there is not big enough now to justify building a full-blown chemical plant.

India, Butti said, is a different story. That market could support chemical production, but OPS demand in India now is "marginal."

Finally, he noted that there is only plant in North America producing antioxidants. He said Songwon sees that market as having potential for supporting another such plant. But it's still too early to determine that, he said, with a couple more years needed to assess demand and market conditions.


Comments

Songwon eyes major revenue boost

By Robert Grace
Associate Publisher & Business Development Director

Published: October 18, 2013 1:47 pm ET
Updated: October 19, 2013 6:50 am ET

Post Your Comments


Back to story


More stories

Image

Small is beautiful in Nissei's newest press

November 21, 2014 2:14 pm ET

Responding to customer demand for flexibility, Japanese plastics-equipment manufacturer Nissei Plastic Industrial Co. Ltd. is demoing a caster-...    More

Image

Dow reaches agreement with Third Point

November 21, 2014 9:11 am ET

Dow Chemical Co. has reached an agreement with the investment firm that has been trying to force the company to sell off some assets.More

Image

Ineos making its UK shale play

November 21, 2014 9:29 am ET

Chemical giant Ineos Group AG is planning to be the biggest player in the United Kingdom's shale gas industry.    More

Image

Total to buy majority stake in Polyblend

November 20, 2014 10:04 am ET

French oil and gas giant Total SA will buy a 68 percent stake in Germany's Polyblend GmbH, a subsidiary of Polymer-Chemie GmbH.    More

Image

Silica can replace plastic microbeads

November 19, 2014 6:00 am ET

As cosmetics and soap makers face pressure to remove plastic microbeads from their products, Evonik Industries touts its new silica-based microbeads a...    More

Market Reports

Plastics in Brazil - State of the Industry Report

This in-depth report examines the Brazilian plastics industry from a historical and geographical context. Our analysts provide insight on economic trends and forecasts, growing manufacturing sectors that utilize plastics, private investment opportunities, market environment challenges, and innovations in R&D.

Data tables and charts on producer prices, trade, plastics production and end market indicators is also included.

Learn more

Plastics Recycling Trends in North America

This report is a review and analysis of the North American Plastics Recycling Industry, including key trends and statistics based on 2013 performance. We examine market environment factors, regulatory issues, industry challenges, key drivers and emerging trends in post-consumer and post-industrial recycling.

Learn more

Injection Molders Market Report & Ranking 2014

This special package contains our 132-page 2014 Market Report on the Injection Molding segment and our exclusive 2014 RANKINGS database of 500+ Injection Molders for a discounted package price.

Learn more

Upcoming Plastics News Events

January 14, 2015 - January 14, 2015Plastics in Automotive

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

June 2, 2015 - June 3, 2015Plastics Financial Summit - Chicago 2015

September 16, 2015 - September 18, 2015Plastics Caps & Closures - September 2015

October 27, 2015 - October 29, 2015Plastics Financial Summit - New York - 2015

More Events