Applied Extrusion Technologies Inc. is increasing the size of a previously announced oriented polypropylene film expansion and has decided to locate it in Terre Haute, Ind. The Peabody, Mass., firm announced Jan. 4 that it will install by late 1997 a 33-foot-wide, 50 million-pound-per-year OPP line, which it says is the largest such line in the world.
AET President Thomas Williams said his firm increased the line's planned size to boost productivity and cost-efficiency. AET already is installing a 261/2-foot, 40 million-pound OPP line in Terre Haute, scheduled to begin production in May. Its original 261/2-foot OPP line at Terre Haute has been running since 1991.
Williams said in a Jan. 4 telephone interview that AET is investing about $100 million in its two new lines. He did not disclose suppliers for the 33-foot line, or confirm a previous report that the new 261/2-foot equipment includes a Mitsubishi Heavy Industries extruder and Bruckner stretching equipment.
Williams said AET is bullish on OPP growth prospects and is investing in new, cost-efficient technology ``to be the unquestioned OPP films leader in North America.'' When expansions are complete, the company will have 235 million pounds of annual capacity. It also makes OPP film at Covington, W.Va., and Varennes, Quebec.
Last June, a Mobil Chemical Co. spokesman said his company was debottlenecking capacity to 250 million pounds per year.
AET will fund the Terre Haute expansions partly from a $50 million stock offering last August.
The company also will rely on cash flow and loans for the investment.
Williams said the OPP industry is ``undergoing an inventory correction, [but] the fundamental drivers remain strong.'' OPP use is growing in snack, confectionery and soft drink markets, and as flexible packaging replaces rigid packaging, he said.