By Liz White, UTI editor
Leverkusen, Germany - Polyurethane sales for Bayer MaterialScience rose by 9.1 percent in 2012, to €5995 million ($7815 million), as a result of both higher volumes and price increases.
These strong polyurethane sales were an "especially positive factor" for the Bayer sub-group, and attributable to rising demand and "satisfactory capacity utilisation," at its facilities, said Bayer chairman Marijn Dekkers, speaking at Bayer's annual results meeting in Leverkusen, Germany, 28 Feb.
Total BMS sales for the year were €11.5 billion, a 3-percent rise over sales in 2011. Sales for the Coatings, Adhesives and Sealants business, much of which is polyurethane-based, rose 3.5 percent to €1972 billion, while polycarbonate sales fell by 7.1 percent to €2823 billion for the year (all figures adjusted for currency and portfolio changes).
Global growth for TDI (toluene diisocyanate), largely used for flexible foam, rose at a higher rate -- over 6 percent -- than growth for MDI (methylene diphenyl diisocyanate), used widely in rigid insulation foam.
Patrick Thomas, head of the BMS business, told UTI this was "the highest growth in TDI we've seen for a very long time."
Thomas said to see TDI growing at higher rates than MDI was "historically very unusual," and he attributes this to high demand for comfort foam in emerging markets around the world, with Africa's demand rising strongly, for example.
MDI growth rates were around 6 percent last year, so close to those of TDI, but Thomas commented that this is "below the long-term trend."
TDI supply is currently tight in North America, with Bayer's 220-kilotonnes-per-annum Baytown, Texas, TDI facility currently halfway through a 15-day maintenance shut-down, which has caused it to declare force majeure on TDI supply in the region. One unit - about half the production capacity there -- is now operating again, Thomas said.
One factor in supply /demand in isocyanates currently is some companies have exited the business, and the plants are so large that a shut-down takes out a big percentage of the market, Thomas said.
The Bayer MaterialScience chairman put global TDI capacity utilisation rates in the upper 80-percent range, with MDI utilisation rates slightly lower.
As a group, Bayer's total sales were €39.8 billion, a five percent increase over sales for 2011, but earnings before interest and taxes (EBIT) fell by nearly five percent to €4 billion, held back, Dekkers said, by adverse effects from legal claims related to the group's Yasmin oral contraceptive. Healthcare reforms also held back sales/earnings in the pharmaceuticals business, he added.
For the BMS business, board member Werner Baumann said Bayer's goal for 2013 is growth of 1-2 percent above GDP growth for 2013, noting that unlike with pharmaceuticals and crop science sales, this is a cyclical business, where sales are dependent on the economy.
