North America is calling and Reliance Industries Ltd. is listening.
The Mumbai, India-based conglomerate made its debut at NPE 2006 in Chicago this year after fielding a major increase of material requests from North America after a pair of hurricanes hit the Gulf Coast last fall, disrupting resin supply.
Kamal Nanavaty, president of Reliance's cracker and polymers sector, said interest in the first part of 2006 also has been stronger than normal, Reliance sold about 30 million pounds of polypropylene and polyethylene in North America last year, he added.
Although Reliance is one of the world's largest PP makers, most inquiries from North America have been for polyethylene. As a result of the increased interest, Reliance is considering establishing a series of warehouses with locations in Charleston, S.C., and in the Houston and Los Angeles areas. Such a network would allow Reliance to have around 40 million pounds of material available for delivery in North America at any given time.
Reliance can deliver a shipment of resin by sea from Mumbai to Charleston in 18 days, Nanavaty said.
In India, 2006 growth for commodity plastics is expected to average about 16 percent, according to Nanavaty. Growth in PP should be slightly higher than the average, at 17-18 percent. Overall, Reliance sells about one-third of its output into the export market.
Increased modernization in the nation of more than 1 billion people is creating a larger middle class, spurring demand for plastic products. The Indian economy is on track to grow more than 8 percent in 2006.
The firm - which ranks as India's largest maker of PP, PE, PVC and PET - opened a 660 million-pound-capacity plant in Jamnagar in April. In 2008, the firm will add 2.2 billion pounds of PP capacity, bringing its total to 6.6 billion pounds. A major increase in oil refining capacity at Reliance is creating propylene monomer, which is being used in PP production.
Reliance posted sales of almost $20 billion and profit of more than $2 billion in its fiscal year ended March 31. Petrochemicals and plastics accounted for about 30 percent of total sales. During the year, total sales grew 22 percent and petrochemical-related sales grew 10 percent.
Dhirubhai Ambani founded Reliance as a commodity trading and export house in 1958 with an investment of about $400. Ambani, who passed away in 2002, stepped into manufacturing in 1966 by opening a textile mill in Naroda. From there, it was a series of increasingly larger steps into backward-integration that led the firm into polyesters and raw materials, and from there into oil and gas.