ResinDirect LLC, formerly Louis Dreyfus Polymers, has boosted its resin-distribution volume 25 percent since it began handling commodity sales for GE Polymerland in 2000.
The firm is on track to distribute 500 million pounds of prime polyethylene, polypropylene and polystyrene this year, President Bill Rippe said in a recent telephone interview.
Operating out of a 10-person North American sales office in Davidson, N.C., since January, ResinDirect handles procurement of resins from BP Amoco plc, Nova Chemicals Corp., Formosa Plastics Corp. USA, Equistar Chemicals LP, ChevronPhillips Chemical Co., Huntsman Polymers Corp. and Denka Inc.
Internationally, ResinDirect will use both its own name and its prior Louis Dreyfus Polymers identity. The firm also operates sales offices in China, Singapore, Turkey and South America. ResinDirect and its parent firm, Louis Dreyfus Energy Services, are part of Louis Dreyfus Group, a Paris-based investment firm and commodities broker.
The GE Polymerland arrangement is designed to keep ResinDirect in low profile ``so that the GE customer sees a seamless GE Polymerland,'' Rippe said. He described GE Polymerland as ``the main leg of our [less-than-truckload] business,'' but added that growth in non-GE distribution prompted the opening of the Davidson sales office.
Rippe declined to specify how much of ResinDirect's sales volume comes from GE Polymerland. He explained that most of ResinDirect's customers are injection molders and that the average customer buys between 3 million and 5 million pounds of resin annually.
Dreyfus' 150-year history in areas ranging from sugar to energy is an advantage for ResinDirect, Rippe said.
``[Dreyfus'] prime expertise is in managing commodities globally,'' he said. ``We're doing the same thing [with ResinDirect] that we've done in grains and energy. We've used the same model of best-in-class fulfillment.''
Further consolidations and acquisitions probably are in the future for the North American resin distribution market, according to Rippe.
``Being the largest global player with the largest global perspective, we're continually looking for opportunities to do alliances like GE Polymerland or active business combinations,'' he said. ``It's inevitable that producers and buyers demand that [distributors] take on more risk, and that demand can only be filled by a larger company.
``We're going to see a continuation of the trend of resin makers pushing larger and larger customers onto the middle market of distribution.''