Styrolution closing Massachusetts plant, moving production to Alabama

By Frank Esposito
Senior Staff Reporter

Published: February 25, 2014 8:38 am ET
Updated: February 26, 2014 11:07 am ET

Related to this story

Topics Materials

Materials maker Styrolution will close its polystyrene plant in Indian Orchard, Mass., by the end of the year, moving some of that site's production to Decatur, Ala.

Closing the Indian Orchard plant will eliminate 58 jobs. The plant has annual production capacity of 330 million pounds and was opened by Monsanto Inc. in the 1970s.

Frankurt, Germany-based Styrolution now will convert a PS line in Decatur over to production of NAS-brand styrene methyl methacrylate (SMMA) resin by the end of the year. The firm also is in the process of adding SMMA production at its plant in Ludwigshafen, Germany.

In a Feb. 25 news release, officials said that PS "remains a core business for the company," but they added that the closing of Indian Orchard "comes following years of overcapacity in the North American PS market." North American PS demand actually grew about 1 percent in 2013, according to the American Chemistry Council in Washington, but that was only the third time in the last decade that sales posted year-over-year growth.

"Polystyrene in all regions, but especially in North America, has shrunk," Styrolution Americas president Alexander Glueck said in a phone interview. "Sales were good last year, but the outlook is flat. Our four plants were at a utilization rate that wasn't sustainable long-term."

In addition to Decatur and Indian Orchard, Styrolution also operates North American PS plants in Channahon, Ill., and Altamira, Mexico. Glueck said those plants had a combined utilization rate that was "in the low 70s" during 2013.

He added that PS has faced several challenges in the last decade. Some applications in packaging – one of the material's major markets – need less material now, according to Glueck, and PS also has seen intermaterial competition from polyethylene and PET, as well as from non-plastic materials. High benzene feedstock costs also have made PS expensive when compared to other resins, he added.

Growth for NAS, however, checked in at 5 percent last year, Glueck said, with much of that growth coming from specialty packaging and containers. Moving production of that material to Decatur and adding it in Ludwigshafen is part of Styrolution's plan to have production of both specialty and standard products in at least two regions in order to better serve local customers. Prior to the move, Indian Orchard had been the firm's only global NAS production site.

The Indian Orchard plant is one of Styrolution's older facilities and had the smallest production capacity of the firm's four PS sites. It also "doesn't have state-of-the-art layout or logistics," Glueck said. "From an economic point of view, (closing Indian Orchard) is the right decision. It's important to see (the closing and adding NAS production elsewhere) in the context of our Triple Shift strategy."

Styrolution's Triple Shift growth strategy is aimed to move the firm more into styrenic specialties, emerging markets and higher-growth industries, including automotive, construction, healthcare, household goods and electronics.

Other growth initiatives currently underway by Styrolution include:

  • Building a production line making a specialty styrenic feedstock at its plant in Altamira. The new line will make alpha methyl styrene acrylonitrile (AMSAN), a material used in Styrolution's Novodur-brand ABS and Luran-brand ASA resins. Adding AMSAN production in Altamira will allow Styrolution to expand its product offering and increase supply reliability throughout the Americas, as well as in industries such as automotive and construction. Currently, Styrolution imports the material into the Americas from a plant in Germany. The new line in Altamira is expected to be in production by mid-2014.
  • Forming a joint venture with Brazilian petrochemicals giant Braskem SA to build a new plant making ABS and related resins in Brazil. The plant would have annual capacity of about 220 million pounds for ABS, styrene acrylonitrile (SAN) and specialty styrenics. Styrolution would own 70 percent of the proposed JV. Groundbreaking for the proposed plant could begin as early as 2015, with production launching in 2017.
  • Upgrading and consolidating its North American research labs into a single site in Channahon by mid-2014. The move will allow Styrolution to develop its own material grades in the region and will bring its R&D teams together to increase efficiency.
  • Commercializing two new grades of its Zylar-brand styrenic copolymer that were introduced at the K 2013 trade show. The new grades are aimed at medical devices and household goods. A new grade of Novodur-brand ABS designed for electroplated applications also was launched at the show.
  • Reorganizing some of its facilities in Germany in order to optimize production.

The changes affect styrenic specialty resins made at its sites in Cologne, Ludwigshafen and Schwarzheide. Styrolution will now offer Novodur ABS copolymer grades from all three sites, while Luran S materials (ASA and ASA/PC) are now available from both Ludwigshafen and Schwarzheide. The company also will expand compounding capacity in Schwarzheide to enable insourcing of specialty ABS and Novodur GF previously produced by external partners.

Styrolution was formed in 2011 as a joint venture between the styrenics units of Ineos Group and BASF SE. The firm employs 3,200 at 17 sites worldwide and has annual sales of almost $8 billion. It ranks as one of the world's largest makers of styrenics, including polystyrene and styrene monomer.


Comments

Styrolution closing Massachusetts plant, moving production to Alabama

By Frank Esposito
Senior Staff Reporter

Published: February 25, 2014 8:38 am ET
Updated: February 26, 2014 11:07 am ET

Post Your Comments


Back to story


More stories

Image

Material Insights: PP production issues, preparing for NPE

January 26, 2015 1:38 pm ET

Production problems in Texas add more complication for polypropylene, Entek has new equipment ready to show compounders at NPE and we take a look...    More

Image

J6 Polymers to buy Stepan unit

January 26, 2015 12:22 pm ET

NORTHFIELD, ILL. — Stepan Co. plans to sell its specialty polyurethanes systems business to J6 Polymers LLC in a cash deal.    More

Image

UK legislators debate fracking

January 26, 2015 12:19 pm ET

LONDON — An influential group of members of Parliament has called for a moratorium to be imposed on fracking for shale gas as politicians...    More

Image

Oxo-biodegradable lobby slams 'scaremongering'

January 26, 2015 12:16 pm ET

Single-use plastic carrier bags made from biodegradable material should be exempted from the government’s proposed 5p-a-bag levy in England,...    More

Image

2014 leaves some resin firms in the black while others struggle

January 23, 2015 2:37 pm ET

On the financial side, 2014 was good for Hexcel Corp., so-so for Celanese Corp. and it could have been better for Omnova Solutions.    More

Market Reports

Plastics in Automotive: Innovation & Emerging Trends

This special report newly released by PN and sponsored by The Conair Group examines current trends in the use of plastics in automotive, materials innovations and the changing landscape. It includes a review of legislative/regulatory activity impacting vehicle development and lightweighting, market opportunities & challenges for mold and toolmakers, innovative design strategies being implemented by major OEMs and suppliers, as well as a review of key indicators in Canada, Mexico, Brazil and China.

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 Molding Market Analysis & Processor Rankings

Plastics News BUNDLED package contains our in-depth Market Analysis of the Injection Molding segment. You will gain keen insight on current trends and our economic outlook.

As a BONUS this includes PN's updated 2014 database of North American Injection Molders RANKED by sales volume. Sort, merge, mail & prospect by end market, materials processed, region, # of plants and more.

Learn more

Upcoming Plastics News Events

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