Some observers of the North American PET resin market believe recent capacity additions have given the region plenty of resin - but resin producer M&G Group apparently does not share that opinion.
Tortona, Italy-based M&G announced July 25 it will build a single-line plant with annual capacity of 1.8 billion pounds at an undisclosed U.S. location. About 1.4 billion pounds of that capacity is expected to be available in the first half of 2009, M&G officials said in a news release.
The new plant will use M&G's EasyUp-brand process technology. EasyUp also is being used at M&G's 1 billion-pound-capacity plant in Suape, Brazil, which began operating earlier this year.
And as if the new plant weren't enough, M&G also plans to add 440 million pounds of annual capacity by streamlining plants in Apple Grove, W.Va., and Altamíra, Mexico, by the end of 2008.
``We expect that continued strong PET demand growth, ... delays in our competitors' previously announced investment programs ... and constrained and costly imports will contribute to a significant PET capacity shortage in the U.S. by the year 2009,'' said M&G's Marco Ghisolfi.
``Although we believe that PET industry margins are still depressed when compared to other industries ... as industry leaders, we feel it is our responsibility to bridge the expected capacity gap to support our contract customers and the sustainability of the North American PET industry's growth,'' added Ghisolfi, who serves as chief executive officer of M&G's polymers business unit.
Already in 2007, Eastman Chemical Co. has opened a new 770 million-pound-capacity PET plant in Columbia, S.C. Indorama Polymers plc also added 200 million pounds of capacity at its Starpet Inc. plant in Asheboro, N.C., and announced plans to open a new 650 million-pound facility at an undisclosed North American site by late 2008.
In 2006, DAK Americas LLC completed part of a 450 million-pound expansion in Wilmington, N.C., and Wellman Inc. added 300 million pounds of PET capacity by converting part of a fibers operation in Port Bienville, Miss.
Industry officials have projected North American PET demand growth at 6-8 percent in 2007.