Outlook for blow molding machinery a ‘wild card'

For manufacturers of blow molding machines, the U.S. market in 2019 was a mixed bag, as some officials reported business was solid and others reported customers holding onto their wallets longer before making capital investments.

And 2020 is a wild card, an election year that follows several strong years of machinery sales, they said.

The ongoing rise of energy-sipping all-electric and hybrid blow molding presses is giving some "green-cred" to blow molding machinery builders. And even the war on single-use plastics is an opportunity for machinery and material technology for PET and polyethylene, they said.

Meanwhile, the boom in hydraulic fracturing of gas means industry officials say prices of polyolefins should remain stable or even go down — giving a big boost to the U.S. blow molding sector, both consumer and industrial.

In business news, new ownership at Uniloy was the biggest blow molding story of 2019. In May, private equity firms Osgood Capital Group LLC and Cyprion Investment Partners LLC bought Uniloy from Milacron Holdings Corp. About a week after the deal was completed, Milacron itself was purchased by Hillenbrand Inc.

Tom MacDonald, vice president of operations at Uniloy Inc., said the company has set up an aftermarket warehouse and production warehouse for subassemblies to support its blow molding machines at the headquarters in Tecumseh, Mich. The next step will be moving the machinery manufacturing to Tecumseh from Milacron's assembly plant in Batavia, Ohio, starting with reciprocating screw machines, he said. Other types of blow molding machines will follow, including shuttle, injection blow, accumulator-head machines and parison-transfer equipment.

Uniloy President and CEO Brian Marston said the company has recorded nearly double-digit growth on machinery and mold sales. Uniloy officials did see a pause in business through the summer months, but overall, he said, "our sales have been pretty strong though 2019" even with the change in ownership.

Backlog going into 2020 is about 20 percent ahead of the year before. Even so, Marston said the coming year comes with some question marks, like environmental challenges and political headlines.

"Our customers are having some challenges with investing," he said. "So I'm concerned that in the election year, we might slow down."

Jamie Pace agreed about the presidential election next November. "The biggest unknown is obviously the election year," he said, calling it a possible "point of instability."

The year 2020 should be a solid one, said Pace, president and CEO of Nissei ASB Co., "but until we get there, we don't know." The China tariffs don't impact Nissei ASB, which gets injection stretch blow molding machinery from its Japanese parent, Pace said, "but it could be positive if it really drives more reshoring."

Sales went down about 10 percent this year for Nissei ASB, in Smyrna, Ga., Pace said, about the same as the overall market. "Basically, what our customers are saying this year is they put a lot of capital into automation, and now with that behind them, they're forecasting higher spending for the coming year," he said.

At K 2019, Nissei ASB showed its Zero Cooling technology on all five blow molding machines running in Düsseldorf. The process uses ASB's four-station, one-step method to shift cooling away from the injection station and into the secondary conditioning station. That reduces cycle times by 30-50 percent and increases quality, Pace said. Zero Cooling is also especially good for shorter, thicker preforms for markets like cosmetics, personal care, pharmaceutical, household and food, which he said is a major strength of Nissei ASB in North America.

Two of the company's blow molders also ran 100 percent recycled PET.

Plastics recycling and the circular economy were the big themes of K 2019. German machinery supplier Krones AG joined forces with sorting specialist Stadler Anlagenbau GmbH to bring new technologies to PET recycling and providing turnkey factories.

Kautex Machines Inc. of North Branch, N.J., has been focusing more on extrusion blow molded machines for packaging, as its blow molded fuel tank business slows because of some investment saturation and the pause as automotive sorts out a future of electric and hybrid cars, President Bill Farrant said.

"We had an excellent first half of the year," Farrant said. "Then it went a little bit quiet toward the summer, and we're seeing a pickup again at the end of the year." What about 2020? "Next year will probably be as tough as this year, but I'll think we'll hold our own. We're still seeing growth in our packaging business, which I think is encouraging," he said.

Farrant said efficiency is a major trend for blow molding equipment. "Our big drive for packaging is the all-electric machines. That's where we're having big success," he said.

At K 2019, the German parent company Kautex Maschinenbau GmbH introduced a fast-color-change extrusion head that lets technicians flush out color in just 20 minutes, even from black to white.

And Farrant said the much-discussed negative publicity on plastics could end up helping machinery companies like Kautex. "We have been pushing multilayer for a long time for using recycled material. So we're seeing that as an opportunity," he said.

Uniloy's Marston said another opportunity is bioresins. Uniloy is working with resin suppliers that are moving to bio-based material.

"We want to use our lab to help those companies develop those materials for blow molding," Marston said.

Gary Carr, vice president of sales at Bekum America Corp., said the company in Williamston, Mich., had a "very strong business year" and added, "it really isn't showing any signs of letting up." He said Bekum has more demand for hybrid electric-hydraulic machines in North America than fully electrics.

You can count Carr as another machinery leader closely watching the public spotlight on single-use plastics. He said there is no simple answer, but equipment makers have to be ready.

"As we look at the future in terms of the machinery, what we will certainly be doing, and need to be doing, is make sure our systems are capable of running, for example, trilayer bottles where [post-consumer resin] could go in the middle," he said.

PET is the most recycled plastic, and Carr said work continues on extrusion blow molded PET containers with handles.

Plastics News Economics Editor Bill Wood said there is hot demand for PET handleware for juice bottles and agrichemical bottles. "So, when I just think of strength, it's just these pockets, and I don't think anybody can shift fast enough to catch those waves. You work on it for 10 years and suddenly figure out a way to make those PET juice jugs, and it turns out the market wants them," he said.

Carr said Bekum is also pushing fast mold changes on shuttle machines by using magnetic mold clamping, a technology more often used by injection molding.

Rocheleau Tool and Die Co., the maker of extrusion blow molding machines, had "a little bit of an up-and-down" year, President Steve Rocheleau said. "The overall business level is OK, but it's not as deep of a backlog and there's certainly been some pressure on the packaging side of the business, based on the sustainability side and talk about recession," he said.

But those same trends can help blow molding press makers "if you have a solution to save energy, or for recycling," Rocheleau said. He stressed that materials suppliers, machinery makers and processors all have a key role: "Everybody's got to move in unison."

One advantage the Fitchburg, Mass., company offers for running recycled content on its reciprocating screw machines is the ability to set the shot size volumetrically, instead of by screw rotation or time, he said. That can reduce variability when running recycled.

On the electric technology front, Rocheleau said his company introduced a hybrid drive blow molder at NPE2018, with a variable frequency drive. Now the machinery maker is spreading that hybrid approach to a full lineup of reciprocating screw machines.

What does Rocheleau think about 2020? "There's a lot of latent demand that's just sitting there. We're quoting projects, but people are just saying we're waiting to launch this."

York, Pa.-based Graham Engineering Corp. makes wheel machines, extrusion blow molding machines and accumulator-head machines. Gina Haines, vice president and chief marketing officer, said the U.S. market was slow in the first half, although the company has experienced an uptick in second-half activity. "I expect the ongoing scarcity of used equipment to continue to favor demand for new," she said.

Haines said Graham Engineering has a history of helping customers' sustainability efforts while also optimizing product design for performance and manufacturability. "Sustainability, the incorporation of recycled material, bioresins and material reduction are on everyone's radar," she said.

For the extrusion blow molding sector, the U.S. natural gas fracking boom means stable pricing for polyethylene. "That's a big, huge advantage for the U.S. blow molding market. Because with the increase of onshoring, it becomes even more advantageous when your raw material prices are coming down," Kautex's Farrant said.

Heidi Amsler, sales and marketing manager for W. Amsler Equipment Inc., said the maker of all-electric PET stretch blow molding machines was getting a lot of activity toward the end of the year. "It was kind of an average year for Amsler until the last couple of months and then it started to pick back up," she said.

Amsler Equipment of Bolton, Ontario, has been targeting the craft beer market. Heidi Amsler said there is a lot of interest in the company's machinery to blow mold a 64-ounce PET growler.

Used machinery is scarce in the accumulator-head machinery segment, according to Bob Jackson, president of Jackson Machinery Inc. in Port Washington, Wis. But he said demand for rebuilt machines remains high, and while that helps his company, Jackson can't understand why processors aren't turning to new accumulator-head presses, including ones that use all-electric and hybrid technology.

Jackson thinks much of the reason is increased private equity ownership of blow molders. "So they wear the machines out and they don't repair them quickly enough and they don't have the people to repair them," he said.

For Uniloy, Marston said the key for accumulator heads has been diversifying markets beyond automotive and into consumer products, toys, large industrial bulk containers and electrical box enclosures. "We've been pretty steady for several years in terms of the number of the machines we produced," he said.

Staff reporter Audrey LaForest contributed to this report.