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DAK Americas focusing on PET growth and recycling in Argentina

By: Bob Moser

June 18, 2014

BUENOS AIRES — DAK Americas expects to introduce local production of its heat-set Laser+HS PET resin for hot-fill applications with PepsiCo and Coca-Cola Co. in the third quarter of this year, a product long available in the United States but under review by Argentine clients for more than two years, the company’s sales and marketing director told Plastics News during Argenplás.

As part of the Alpek unit of Mexican conglomerate Alfa SAB de CV, DAK Americas wants to help stimulate hot-fill potential in Argentina and neighboring markets after seeing regional PET consumption hit a ceiling in recent years, said Emilio Larranaga, sales and marketing director for PET resins in Argentina.

DAK is currently Argentina’s only PET producer, having acquired its local plant from Eastman Chemical Co. in 2008. The company produced roughly 195,000 metric tons of PET last year while operating at full capacity, with 80 percent of its resin sold domestically.

Following DAK’s acquisition in May of recycled PET resin producer CabelmaPET SA in Buenos Aires, the company is integrating operations and plans to start producing a single-pellet solution by the end of this year, said Marcelo Luis Blois, corporate affairs manager in Argentina.

CabelmaPET’s recycling facility reprocesses as much as 23,000 metric tons of bottles per year, producing more than 12,000 metric tons of post-consumer PET pellets in 2013, sold mainly to Coca-Cola.

Many DAK Americas clients are operating separate lines for virgin and recycled PET resins that mix the two on-site. With the CabelmaPET recycled resin now in-house, DAK’s single pellet solution will include 25 percent recycled content, Blois said.

The CabelmaPET acquisition will also help DAK eventually reduce its dependence on imported PET raw materials in Argentina, of which the company now imports 100 percent.

“Argentina has no infrastructure in place, outside of natural gas, to produce PET and key petrochemicals locally,” Larranaga said. “Our goal is that by 2016, CabelmaPET will supply 25 percent of our total resin needs.”

It’s an admittedly lofty goal within two years, and will require DAK to work closely with local and state governments to stimulate growth for PET bottle collection in Argentina.

The national PET collection rate is roughly 30 percent now, Larranaga said, but that rate needs to reach at least 50 percent for DAK to self-supply one fourth of its resin needs. The company is still only developing a game plan on how to stimulate collection growth, and couldn’t provide details on an investment budget for the project.