Styron exiting North American commodity polycarbonate market

By Frank Esposito
Senior Staff Reporter

Published: May 30, 2014 11:49 am ET
Updated: May 30, 2014 1:37 pm ET

Image By: Styron LLC

Related to this story

Topics Materials Canada Mexico United States Materials Suppliers
Companies & Associations

Styron LLC no longer will sell commodity grades of polycarbonate resin in North America.

Berwyn, Pa.-based Styron will end its PC supply agreement with Dow Chemical Co. in the fourth quarter of this year. Dow had produced PC for Styron on a contract basis at a plant in Freeport, Texas, since Styron was spun off from Dow and acquired by private equity firm Bain Capital in 2011.

Commodity PC grades — including those used in sheet, bulk extrusion and optical media — “tend to be lower-margin,” Styron spokeswoman Catherine Maxey said in a May 30 phone interview. So Styron will no longer serve those markets.

Styron will continue to market higher-margin compounds and blends that are toll-produced by PolyOne Corp. These materials are sold into medical devices, lighting, automotive and similar applications. PC used in those blends will be sourced from an unidentified third-party supplier and from a Styron PC plant in Stade, Germany, Maxey said.

“Our [compound and blends] customers won’t see any change, and no Styron jobs will be affected,” she added.

According to Maxey, Dow will discontinue PC production in Freeport, where Styron had been its sole customer. Dow will close and dismantle its PC unit there, she said. Officials with Dow in Midland, Mich., could not be reached for comment.

In a recent filing with the Securities and Exchange Commission, Styron officials said the firm would have saved $35 million in 2013 by ending its contract with Dow and altering some raw material contracts at its Stade plant.

Styron’s exit from the commodity PC market will leave Sabic Innovative Plastics and Bayer MaterialScience as North America’s only remaining regional producers of that material. BMS parent Bayer AG of Leverkusen, Germany, has been seeking a buyer for that unit, according to media reports.

Styron posted mixed results in the first quarter of 2014. Sales fell 2 percent to $1.36 billion, but the firm registered a $17.1 million profit after losing $9.7 million in the same quarter last year. In addition to engineered polymers, Styron’s products include styrenic resins, synthetic rubber and latex. The firm’s assets include a 50 percent stake in Americas Styrenics, a joint venture it operates with Chevron Phillips Chemical Co.

Styron also earlier this year filed for an initial public offering at an unspecified date. The firm hopes to raise as much as $200 million through the IPO. The firm had filed for an IPO in June 2011, but withdrew that filing in June 2013. After the IPO, Styron plans to operate as Trinseo SA.

Funds raised by the stock offering would be used to pay down debt, for working capital and for general corporate purposes, officials said in the filing. No stock exchange or target per-share price was listed in the filing.

Styron employs 2,100 worldwide and posted sales of just over $5.3 billion in 2013.


Comments

Styron exiting North American commodity polycarbonate market

By Frank Esposito
Senior Staff Reporter

Published: May 30, 2014 11:49 am ET
Updated: May 30, 2014 1:37 pm ET

Post Your Comments


Back to story


More stories

Image

PolyOne launches Geon BIO PVC using soy-based materials

April 24, 2015 11:48 am ET

More than a decade of research is paying off for Battelle Memorial Institute in the form of Geon BIO PVC compounds from PolyOne Corp.    More

Image

Study suggests infants at lower risk from BPA exposure than expected

April 23, 2015 4:58 pm ET

A new study shows that newborn babies may have less risk from bisphenol A exposure than originally thought.    More

Image

Braskem and Odebrecht reconsidering West Virginia plastics project

April 23, 2015 2:54 pm ET

Brazilian firms Braskem and Odebrecht have confirmed that they are re-evaluating Project Ascent, the major plastics and petrochemicals project they...    More

Image

DuPont center in India gets LEED Certification

April 23, 2015 1:07 pm ET

DuPont Co.'s Knowledge Center in Hyderabad, India, was awarded LEED certification by the U.S. Green Building Council.    More

Image

SiVance opens new R&D lab

April 23, 2015 12:07 pm ET

Milliken & Co. unit SiVance LLC has opened a new research and development lab for silicone and silane technologies in Gainesville, Fla.    More

Market Reports

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

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

Upcoming Plastics News Events

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

September 15, 2015 - September 17, 2015Plastics Caps & Closures - September 2015

More Events