Eastman Chemical Co.'s Voridian unit has stopped production of precolored green PET resin and suspended solid-stating PET operations in Toronto.
The green PET move affects about 160 million pounds of melt-phase polymerization capacity in Kingsport and was made because demand for colored containers has shifted to other low-cost options such as color concentrates, masterbatches and liquid color, Voridian officials said.
The green PET capacity now might be used to produce other Eastman products such as liquid crystal polymers or Eastar-brand biodegradable resins, Voridian spokesman Clark Parker said.
Eighteen employees involved in green PET production will be transferred to other areas within the company. The move does not affect Voridian's AmberGuard-brand PET or other precolored amber polymers.
The Toronto closing took effect Jan. 1. The site had been operated for Voridian by Eastman Kodak Co., Eastman's former parent firm. The plant, which processes fiber-grade PET pellets into polymer-grade pellets, can be reopened quickly when PET demand improves, Parker said.
The Toronto location had served a major clear PET customer in the area, but Voridian recently decided it was more economical to supply that customer from a Columbus, S.C., site. The Toronto plant employed 27 - nine have left the company, and 18 will be reassigned within the company.
Both actions ``are necessary for [Voridian] to remain efficient in an increasingly competitive environment,'' according to T.J. Stevens, Voridian North American Polymers director.
Kingsport-based Voridian ranks as the largest PET maker in both the North American and global markets. In North America, the unit controls about one-third of the market.
Eastman's polymers business - including PET and polyethylene - lost $201 million in 2001 as sales dropped 1.5 percent. The firm recently also indefinitely shelved plans to split itself into two companies - one commodity and one specialty - because of a weak global economy.
Stock-wise, Eastman shares could be had for about $40 each Feb. 18, down from their May high of about $54.