China's largest compounder, Kingfa Science & Technology Co. Ltd., is continuing its momentum to build capacity in Asia — including in India. In the meantime, it is taking leaps in expanding vertically upstream to gain high-value-added materials in its product portfolio.
The Guangzhou, China-based company has launched a plant in Tianjin with annual capacity of 220 million pounds and a designed total capacity of more than 880 million pounds, said Willis X. Guan, deputy president of global sales and marketing. Another new plant in Kunshan is nearing completion and performing test runs. It also has a designed capacity of more than 880 million pounds.
To tap into the growing market in India, Kingfa has established a subsidiary in India and is planning to build a factory. “We are in the process of picking a location for the plant and deciding on the capacity based on local demand,” Guan said at NPE2012, held April 1-5 in Orlando.
Including those two plants, Kingfa now claims total annual compounding capacity of 2.6 billion pounds. Compounding now represents more than 90 percent of the company's sales.
The publicly listed company in 2008 started what it called a transition to “upstream and high-end materials synthesis” through organic growth and acquisition. It has since built a 2.2 million-pound-capacity facility for nylon 10, with 50 percent of the content derived from castor oil. An expansion is under way to launch 22 million pounds of capacity by 2014.
PEEK is another new member of the Kingfa family of products. Tsuyoshi Wen, director of high-performance polymers said the capacity is about 110,000 pounds for now, with another 440,000 pounds under construction.
Kingfa is investing $300 million to start its carbon-fiber project for such end markets as automotive and appliances.
“Eventually, we aim to expand it to [4.4 million pounds] of carbon fiber and [22 million pounds] of carbon-fiber composites,” he said.
With a research and development team of 100-plus, Kingfa launched more than 65 million pounds of annual capacity of 100 percent biodegradable EcoPond-brand polylactic acid/polybutylene succinic polymer in August, which gives the company a leading position in the market, said Kin Wong, marketing director of biodegradable polymers. Kingfa plans to add 130 million pounds of capacity.
Kingfa's EcoPond is mostly exported at this stage, although the Chinese market is expected to take off soon with the latest move by the Chinese government to promote such materials.
About 90 percent of the exports go to Europe and are used to make shopping bags, trash bags, toys, and food-service products. “We work on both government procurement and retailers' projects,” Wong said.
He added that he's optimistic about the U.S. market, where he has seen a flurry of bag bans.
In China, Kingfa is working with municipal governments to promote the use of biodegradable trash bags as well as agricultural films. Wal-Mart is offering biodegradable bags at 150 stores. Another retailer, Jusco, has also started full use of bags made from Kingfa's material.
Wong said the firm's NPE2012 booth attracted many customers from North and South America that showed strong interest in the biodegradable materials.
On the acquisition front, Kingfa acquired Singapore's wood-PVC composites supplier Lesco Technology Pte. Ltd. and expects to reach 33 million pounds of capacity by the end of the year.