With all due apologies to superspy James Bond, the KC America story could be called From Russia, With Fluoropolymers.
Since 1997, the joint venture has marketed fluoropolymers made at Kirovo-Chepetsky Khimichesky Kombinat, a massive Cold War-era chemicals plant in Kirovo-Chepetsk, Russia. About 85 percent of KCKK's output is sold outside of Russia.
Less than 10 percent of KCKK's fluoropolymers are sold in the Americas, but KC America is looking to change that by ramping up its sales efforts on the West Coast, as well as in Mexico and Brazil, according to Jerry Bohinc, a partner in the firm.
``We're working to grow our markets,'' Bohinc said. ``There's a really strong demand for our core product.''
That core product - polytetrafluoroethylene, or PTFE - puts KC America in direct competition with chemical giant DuPont and its Teflon-brand PTFE, as well as established players such as Dyneon LLC. The fluorochemicals sector is on the rebound and is expected to grow 2 percent annually through 2004, when the global market will be worth almost $5 billion, according to the Freedonia Group, a Cleveland-based research firm.
Although some questions have been raised about the quality of material from older, Eastern European plastics plants, Bohinc said KCKK has integrated modern manufacturing methods to produce material that's equal to Western standards.
``In some cases, converting from Russian standards to global standards has involved something as simple as using ultraclean water, which makes a big difference in the finished product,'' said Bohinc, who is based in Gates Mills, Ohio, a Cleveland suburb. ``[KCKK] also improved in areas like coloration. In the old Soviet days, as long as engineering quality was met, their customers were indifferent to coloration issues.''
KCKK's material is finding homes in automotive seals, medical sterilization equipment and tubing and a host of coatings applications. The wire and cable market also looks promising, Bohinc said.
KC America currently distributes from leased warehouse space in New Jersey. The firm is a three-way joint venture among Dawson Partnership, a technology development firm in which Bohinc is a partner; Lucera Inc., a chemical consultancy based in Marco Island, Fla.; and Considar Inc., a New York-based materials trader.
The KCKK plant was built in 1949 and first produced fluorine-based chemicals used to purify uranium for Soviet weapons. Its polymers plant employs 3,000 and can produce almost 18 million pounds of fluoropolymers annually.
The plant employs an additional 12,000 producing products ranging from artificial blood to fertilizer. KCKK was privatized in the wake of Russia's economic collapse and now is one-third government-owned, with the remaining two-thirds split between investors from Russia and other parts of Europe as well as the plant's own employees.
Bohinc declined to release a sales estimate but said KC America is looking to expand its product mix beyond KCKK materials to provide additional products that its customers use.