DÜSSELDORF, GERMANY (Nov. 21, 1:15 p.m. EST) — Japan's Ube Industries Ltd. is literally putting a stake in the ground, as it prepares to build its first European nylon resin plant en route to its goal of becoming a dominant global producer of that material.
The company in late October created Ube Engineering Plastics SA in Castellón, Spain, about 40 miles north of Valencia, to oversee the new complex. Bruno De BiÃ¨vre, general manager of Ube Europe SA's engineering plastics department, will serve as managing director of the new subsidiary, which will make products for sale in Europe, Africa and the Americas. The existing Ube office in New York will handle marketing for the materials in the United States.
Even though it has been manufacturing nylon since 1959 in Japan, Ube is better known in North America for its injection molding machines than for its plastics materials. The company intends to change that, given its stated objective of becoming the world's leading producer of nylon 6 homopolymer, and nylon 12 and 6/66 copolymers. It said it has no plans to manufacture nylon 6/6.
Ube markets the materials under the Ube Nylon and Ubesta trade names.
In an interview at K 2001 in Dusseldorf, De BiÃ¨vre said the new polymerization plant's first line is due to come on stream by the beginning of 2004, with the capacity to produce 22 million pounds of high-viscosity, extrusion-grade nylon for film and filaments. It then plans to start a second, similarly sized line at the site one year later. The plants will use Ube's own liquid-phase polymerization process.
The company will invest about $81 million over several years at the Spanish site, which also will include caprolactam and fine-chemicals production capacity and a technical center. Ube also revealed it is considering adding a production line in Castellón for its Ubesta nylon 12 grade and possibly building a second plant at the complex by the end of 2005 to make laurolactam, a raw material used in nylon 12. Ube is moving strongly ahead despite projections of a nearly 50 percent fall in operating profit by its chemicals and resins division for the year due to end next March.
“We want to grow strongly in polyamide,” De BiÃ¨vre said, call-ing it a core activity for Ube. “We divested [polybutylene ter-eph-thalate] and polyacetal resin production in the last two years in Japan, to concentrate on nylon.”
He said Ube intends to grow internally and by merger or acquisition. The firm predicts global market demand for its type of nylon materials will grow 7-8 percent annually over the next decade.
Ube already operates an integrated nylon and caprolactam production complex in Thailand, where it has about 55 million pounds of annual capacity, and a nylon resin plant in Ube City, Japan, which can produce 172 million pounds of the material per year. De BiÃ¨vre said the firm has been selling its nylon materials in North America and Europe for 20 years.