The first phase of the massive PET recycling plant being built by DAK Americas LLC and Shaw Industries Group Inc. will be up and running early next year in Fayetteville, N.C.
Phase One will be able to handle 160 million pounds of PET, said Tom Sherlock, DAK's resins business director, in a June 24 interview at NPE2009. Phase Two, set for a 2012 start, will add 120 million pounds of capacity to the project.
Officially, the plant will be owned and operated by Clear Path Recycling LLC, a joint venture between Charlotte, N.C.-based DAK and Shaw, a major carpet and flooring maker based in Dalton, Ga.
There's market demand, and consumers are preferring to move to use of the product with more sustainable packaging, Sherlock said. The brand companies want to be able to say they've got [recycled content] and the big box retailers are promoting it.
The plant co-located with a major DAK facility will use both bale and deposit material across the U.S. Most of its output will be used internally by Shaw for its carpet products. About 25 percent of the output will be sold on the open market.
The plant is expected to employ about 80 when the first phase opens.
DAK earlier this year began making its Laser Plus W-brand PET at its plant in Cape Fear, N.C., Sherlock said. The material which offers improved quality in the water bottle segment had been made at other DAK plants since 2006.
DAK has begun production of specialty polyester resins based on ethylene glycol in Monterrey, Mexico. DAK acquired the technology to make those materials earlier this year from DuPont Co. of Wilmington, Del. The resins are used in rope, conveyor belts and other monofilament and non-woven applications, Sherlock said.
DAK also has enjoyed recent success with Laser Plus UV, a PET grade commercialized in the second half of 2008. The material can block ultraviolet light in order to prevent vitamins and minerals from breaking down in fortified waters and health drinks, Sherlock said.
Like many PET firms, DAK has been impacted by reduced PET demand caused by a slow economy and by light-weighting of bottles, which has allowed for production of much thinner water and carbonated soft drink bottles that use less PET.
Sherlock estimated that light-weighting removed almost 300 million pounds of PET demand from the North American market in 2008 and will remove 180 million to 200 million pounds of demand this year.
Once light-weighting is done, we can position PET as much more preferred packaging, Sherlock said. It's economical, has excellent clarity and is 100 percent recyclable.
Although North American PET demand fell 4-5 percent in 2008, the market could see growth of 1 percent this year, according to Sherlock.
DAK's own capacity is balanced with demand right now, he said. The firm added almost one billion pounds of capacity in 2007 through a capacity addition in Cape Fear and the purchase of Eastman Chemical Co. plants in Mexico and Argentina.
Future expansion could take place in Cape Fear or Fayetteville if needed, Sherlock said. But he said the firm first would measure the impact of other expansions, including a 1 billion-pound-capacity plant to be opened later this year by Indorama Polymers Public Co. Ltd. in Decatur, Ala.
Based on estimated 2008 sales, DAK ranks as North America's fifth-largest PET maker with a market share of 10 percent. DAK is a unit of Alfa SAB de CV of San Pedro Garza García, Mexico.
Copyright 2009 Crain Communications Inc. All Rights Reserved.