Chemtura sees new China plant, its biggest global investment since 2005, driving growth

Rebecca Kanthor
PLASTICS NEWS CHINA

Published: November 6, 2013 4:16 pm ET
Updated: November 6, 2013 4:27 pm ET

Image By: Rebecca Kanthor From left to right: Alan Swiech, senior vice president; CEO Craig Rogerson; Chet Cross, executive vice president for supply chain

Related to this story

Topics Materials, Materials Suppliers, China

Specialty chemicals maker Chemtura Corp. took the wraps off its new China production facility Oct. 31, its largest single investment globally since the company was formed in 2005, as it outlined strategies to try to dramatically boost Asia-Pacific sales.

The $95 million facility in Nantong, Jiangsu province, is seen as a key part of the company's target of boosting Asia-Pacific sales from 18 percent of revenues now to 33 percent by 2018, company executives said.

Nantong "is our biggest single investment since Chemtura was formed in 2005 and it is really the centerpiece of our overall manufacturing plans for Asia Pacific," said Craig Rogerson, chairman, president and CEO, during an Oct. 31 interview with Plastics News in Nantong. "We look at this site as an opportunity to grow."

Chemtura, which employs 4,000 and had 2012 sales of $2.6 billion, designed Nantong with the intent of expansion, and will make a decision within the next 12 months whether to purchase an empty plot of land next to the current site that could double the size of the facility, he said.

Rogerson said that the company's goal of increasing fast-growing markets to up to 50 percent of its total market within five years has not gone as well as hoped so far.

"We're a couple of years into that and haven't made much progress," he said. "Part of the reason is that we sell a lot of products in the electronics market, [like] flame-retardants, and electronics has been soft since basically 2010. So that's been a challenge."

But, he adds, he has no plans to change his targets: "If we're going to grow then we need to grow where the customers are growing the fastest. And that's here."

"The challenge we have is continuing to be innovative and differentiate ourselves from the competition," he said. "We've been pretty good at that traditionally, we just have to prove that we're good at it here."

Substitution will be a key part of the company's strategy for penetration in the Asia-Pacific market, Rogerson said.

Chemtura plans to bring mid-level products to the market and then later introduce more high-level innovative products that are unavailable from local competitors, he said: "You come in and get in and then you sell up, that's the strategy."

The plant will have four production units, including grease, refrigerator oil and finished fluids, and urethane. The fourth unit has yet to be determined, but Rogerson said "the most likely fourth business on this site is organic metallic. That would most likely be a storage or filling facility."

It will help the company address Chinese customer concerns about supply chains, said Chet Cross, executive vice president for supply chain and operations.

"Now one issue that our customers have in China is they're really cautious about the long supply chain," he said. "If we have this filling station and supply hub, you can cut that time to a matter of days vs. weeks. That's much more conducive to our customer base here in China."

"We've looked at the economics of having the refill station here," he said. "'We have space here to do that and it would be relatively cost-effective. It would really help us on our supply chain."

During a tour of the facility with suppliers and government officials, while construction workers continued to work on the 100,000-square-meter site, Nantong site manager Niu Limin said that first phase of the facility will finish in 2015, and cover about two-thirds of the site. The second phase will contain more plastics-related products.

In addition to Nantong, Chemtura has regional headquarters and a shared services center in Shanghai, an application development center in Nanjing and facilities in Nanjing, Korea, and Taiwan.


Comments

Chemtura sees new China plant, its biggest global investment since 2005, driving growth

Rebecca Kanthor
PLASTICS NEWS CHINA

Published: November 6, 2013 4:16 pm ET
Updated: November 6, 2013 4:27 pm ET

Post Your Comments


Back to story


More stories

Image

New Hexcel plant will supply carbon fiber for Airbus A350 XWB

September 30, 2014 2:43 pm ET

Hexcel Corp. is investing $250 million on a new carbon fiber plant in France, with part of the production going into the future Airbus SAS A350 XWB.    More

Image

LyondellBasell CEO Gallogly to retire

September 30, 2014 3:00 pm ET

James Gallogly, CEO of Houston-based polyolefins producer LyondellBasell Industries NV, on Sept. 29 announced plans to retire in 2015.    More

Image

iPhone 6 supplier Jabil accused of labor violations

September 29, 2014 6:00 pm ET

The same Jabil Circuit Inc. facility in Wuxi, China that faced labor violation accusations last September just before the iPhone 5S and 5C release is ...    More

Image

Asahi Kasei breaks ground on Alabama compounding plant

September 29, 2014 5:39 pm ET

Asahi Kasei Plastics North America will be able to solve two problems at once with a new compounding plant in Athens, Ala.    More

Image

Shini pushes into western China

September 29, 2014 4:28 pm ET

Despite intellectual-property brigands, Taiwan's Shini Plastics Technologies Inc. is zestfully pursuing the enormous Chinese market for plastics auxil...    More

Market Reports

Plastics in Mexico - State of the Industry Report

This report analyzes the $20 million dollar plastics industry in Mexico including sales of machinery & equipment, resins and finished products.

Our industry analysis highlights macro industry trends and micro trends faced by companies that do business in Mexico. The report also provides key industry statistics and forecasts to anticipate future industry expansion.

Learn more

Plastics Caps & Closures Market Report

The annual recap of top trends and future outlook for the plastics caps & closures market features interviews with industry thought leaders and Bill Wood’s economic forecast of trends in growing end markets. You will also gain insight on trends in caps design, materials, machinery, molds & tooling and reviews of mergers & acquisitions.

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

More Events