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June 07, 2011 11:00 PM

Stepan's APP capacity reaches 90 ktpa

Simon Robinson
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    by Louise McHenry UTI staff

    Phase one of chemical company Stepan's expansion at its aromatic polyester polyol (APP) plant in Wesseling, Germany, to 90-95 kilotonnes-per-annum (ktpa) capacity from 52 ktpa started in mid May, according to Stepan's vice president of European Polymers, Roger Stubbs.

    A second phase, in 2012, will see Stepan debottleneck the plant (pictured right) to 120 ktpa, depending on market conditions such as rising costs of raw materials - and associated concerns within the insulation industry about polyurethane competitiveness - added Stubbs, in a 13 May interview in UTl's London office,

    To help it tackle possible fluctuations in the insulation market, Stepan has appointed two new executives in Europe, Stubbs said.

    Former Cairn and Chemtura executive David Sedler has joined Stepan as business development director, to "squeeze the last drop out of all new applications and territories," said Stubbs.

    Carlos Ruiz-Pombo is the new commercial director, focusing on existing business and customers. "I'll be taking some of the weight off Roger's shoulders," Ruiz-Pombo said.

    Stepan Europe's recent acquisition of Polish APP and systems supplier Alfa, with a plant in Brzeg Dolny, has broadened the company's range, as it specialises in making APPs from recycled polyethylene terephthalate (PET)

    Stubbs said Stepan has not yet made a firm decision on whether to grow and expand the Alfa systems business, or to sell it on.

    Alfa has capacity for 20-25 ktpa for APPs and 15 ktpa of systems blending, and a financial analysis has already been done on a second reactor, the Stepan team said.

    Stubbs noted that Alfa's technology allows the company to process materials that were not traditionally part of Stepan's remit. "The assets there allow us to handle solids [Germany is all liquids]. The technology is based on a wide variety of exotic acids and glycols ...  and allows us to make a wider range of polyesters, aromatic and aliphatic polyesters."

    Such diversity will mean Stepan is less dependent on insulation. Stubbs specified CASE (coatings, adhesives, sealants and elastomers), uses as potential outlets: "They get wrapped up in an acronym but are massive in their own right," he pointed out. Sedler's appointment is relevant here with his extensive CASE expertise.

    Sedler also suggested that Stepan is contemplating a move into speciality polyester polyols for the technical flexible foam market. "We don't want to go into the commoditised aspects of the flexible foam market," Stubbs said.Sedler added that Stepan did not intend to compete with polyether or adipate-based polyols, but was looking at different chemistry for value-added  niche markets.

    Discussing Stepan's traditional markets of APPs for the flexible- and rigid-faced sandwich panels industry, Stubbs said that a major influence here is the burgeoning interest in energy conservation and therefore building insulation. Stepan Europe is seeing high single­ digit growth for APPs, of around 8-10 percent, due to the demand in insulation. "You can only do so much with double glazing. The biggest bang for your buck comes w ith insulation," Stubbs said.

    Also a lever for growth is the transition from polyurethane to polyisocyanurate (PIR) formulations by insulation suppliers. Stubbs compared the transition to white bread moving to brown bread and added, "Of course, we're selling the brown flour." Noting that PIR is gaining market share because of its fire performance and cost, Stubbs concluded. "That's why we believe that you've got a solid 15 percent growth year-on-year for the next three to five years for APP in Europe."

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