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, China, Materials Suppliers

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

Formosa to be compensated for Vietnam riot

July 28, 2014 1:44 pm ET

Taiwan's Formosa Plastics Group will receive $2.39 million from the Vietnamese government and insurance companies for damages suffered during the...    More

Image

Ukraine's Group DF may be forced to sell Crimea-based additives plant

July 28, 2014 10:12 am ET

Group DF, the industrial business of Ukrainian tycoon Dmitry Firtash, may be forced to sell off Eastern Europe's biggest producer of titanium oxide,...    More

Image

DuPont resins help take Nike golf balls 'Fore!'ward

July 25, 2014 1:07 pm ET

It may be difficult to imagine just how much science, not to mention rubber and plastic components, go into a golf ball. But global giant DuPont Co....    More

Image

Bioplastics maker wins government funding

July 25, 2014 12:13 pm ET

Canadian bioplastics maker Solegear Bioplastics Inc. has won $1.6 million in funding from the government-sponsored Western Innovation Initiative...    More

Image

Report: biodegradeable plastics use in Europe to grow 12 percent

July 25, 2014 10:25 am ET

The biodegradable plastics market in Europe is forecast to witness 12 percent compound growth during 2014-19, according to TechSci Research's “E...    More

Market Reports

Plastics Recyclers Data Report & Directory

This exclusive MS Excel database contains all the companies from Plastics News' ranking of top North American Recyclers and Brokers by reprocessed volume and also includes a directory with materials processes, services offered and company contact information. Data is based on primary research by PN editorial staff.

Learn more

2014 Injection Molding Industry Report

GROWTH, OPPORTUNITY IN SIGHT FOR INJECTION MOLDERS IN 2014

In the wake of the economic turbulence earlier in this decade, molders today find themselves in much better shape. Molders are gaining a competitive advantage by investing in people, equipment and seeking inroads into new markets on a global scale.

Growth in the injection molding industry is going to be driven by low financing costs and a continued move to reshore some business.

Learn more

Shale Gas Market - Analysis of North American Region

This report highlights the impact of shale-based natural gas on the North American plastics market and features an in-depth analysis of production trends in the United States during 2013 and a forecast for 2014 and beyond.

Learn more

Upcoming Plastics News Events

September 10, 2014 - September 12, 2014Plastics Caps & Closures 2014

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

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

More Events