CHICAGO (July 31, 11:50 a.m. EDT) — World polypropylene leader Basell Polyolefins has had a busy year since being acquired by New York investment firm Access Industries.
“I feel like a baseball player who realizes the foul lines and the outfield fence aren't where they used to be,” Basell Polyolefins North America president Randy Woelfel said during a news conference at NPE.
“We have the freedom to think outside the box that we didn't have in the past.”
Since Access bought Basell from BASF AG and Royal Dutch/Shell Group in May 2005, Basell has accomplished the following:
* Confirmed plans to add 770 million pounds of PP capacity in Tampico, Mexico, by 2008.
* Established a joint venture to build an ethylene and polyethylene complex in Saudi Arabia.
* Signed an agreement to build a petrochemicals complex in Kazakhstan, where Access also owns that country's largest coal operation.
* Built new PP and PE plants in Poland.
* Built a new PP compounding plant in Brazil and announced plans to expand its PP compounding in China. When completed, the Chinese plant will have annual capacity of 60 million pounds. The expansion was prompted by faster-than-expected growth in automotive and appliance markets.
* Bought out its partner in a PP-making joint venture in Argentina.
* Added PP compounding capacity by debottlenecking a plant in Australia.
* Acquired a polymer catalyst business from Akzo Nobel in the U.S.
But even though the global economy continues to be fairly positive, according to Basell President and Chief Executive Officer Volker Trautz, other challenges remain.
“Polyolefin [business] cycles used to be measured in years, but now any year can have multiple cycles,” he said.
Trautz also estimated that by 2010, more than 20 billion pounds of polyolefins will be traded among the world's different regions every year, as demand and low-cost supply rebalance.
“Surplus [polyolefin] product with leading cash cost will be looking for a home,” he said.
At NPE, Basell is launching several new products, including grades of PP that can withstand freezer temperatures down it minus 40° F. The material is expected to find a home in the frozen food packaging market.
Other new Basell products for NPE are three new grades of its Metocene-brand metallocene-based PP. The new grades are aimed at markets for cast film and injection molding.
Basell ranks as the world's largest PP maker with almost 18 billion pounds of annual capacity. The firm also operates 5 billion pounds of PE capacity and posted annual sales of more than $10 billion in 2005, with about 20 percent of that amount coming from North America.