08 January 1995 00:00 [Source: PCE]
Some 18 months after the French government privatised its blue chip chemical concern Rhône-Poulenc, the company is becoming increasingly active in specialities, a sector of the French chemical industry which is generally buoyant, registering a total growth output of 7.2% in 1994.
During the first quarter of 1995, Rhône-Poulenc's sales in the speciality chemicals sector rose 8.9% due to a sharp increase in sales volumes of 12% and signs of stronger prices (+3.3%).
As a result, the operating income increased by 37.3% despite the decline in the value of the dollar.
Most of the R-P group companies in the specialities sector benefited from the improved economic environment in Europe, although for a number the 1994 rise in raw material prices has not yet been passed on entirely in the selling prices; particularly in terms of paper chemicals and silicones.
The company's environmental services group, established three years ago, is also experiencing strong growth. The business engages in water treatment, special industrial waste incineration, sulphuric acid regeneration and filtration technology. In 1994 R-P treated 600 000 tonne of special industrial waste for industrial customers in Europe and the US.
A key sector in its strategy is agrochemicals. The company says the new active ingredients it has under development represent potential sales of more than FF4bn ($800m) by the end of the century.
The level of research in this sector over the past few years - equivalent to 9% of sales - has produced important results, particularly in the discovery of two new families of insecticides and herbicides. Among the new products developed from them is Regent, a fiprole insecticide which can be used on a range of crops and has already been introduced in 14 countries. R-P expects it to account for 15% of its agro sector sales by 2000.
Other products include the 1772 herbicide, especially developed for corn; Real, a triti-conazole base fungicide launched in 1993 to protect wheat crops; flurtamone, a herbicide for use with grain; and cyclanilide, a new growth regulator for cotton and hevea.
R-P says cyclanilide promises to be a major advance for cotton producing countries because it will increase crop yields by ensuring the plants open their bolls and lose their leaves at the same time.
The firm's Agro sector, which holds more than 8% of the global market, is represented by some 4000 products. The sector consolidated its position last year, with key moves as follows:
R-P began the year by merging its former organic and inorganic intermediates and speciality chemicals sectors into a single chemical sector, as part of its overall strategic review. The chemical sector is now organised into enterprises which are specific to markets and geographical areas. The company has been concentrating particularly on the Asian market, with alliances with local partners in the following areas:
Elsewhere, French speciality chemical companies are following Rhône-Poulenc's lead and forming strategic alliances to develop new products and markets.
Chief among these is Sipsy, which recently signed a licence agreement with Arco Chemical covering technology to produce, develop and market chiral glycidols and epoxides.
The products will be evaluated by the venture as protease inhibitors, beta-blockers and anti-fungals.
Under the agreement Sipsy has exclusive rights to Arco's epoxidation technology which will enable the French firm to oxidise olefins to make single enantiomer epoxides as pharma intermediates.
Sipsy general manager Jean-François Marcopoulos says the deal with Arco is 'more than a licensing agreement. It is a global partnership in which both companies will invest and share the profits'.
SNPE, meanwhile, is also expanding its business, having recently taken on the Toulouse-based isocyanates unit Tolochimie from Rhône-Poulenc. Tolochimie's aniline technology, available for licensing, was not included in the deal.
SNPE, which produces chloroformates and acid chlorides in a nearby unit, will be able to complete its range of agrochemical products and fine chemicals business.
The group is expected to form a joint venture in China to build a nitrocellulose plant in Shanghai and is due to bring onstream a 1500 tonne/year facility at its Sorgues site in southeast France, in a partnership with ISK of Japan to produce, among other products, the fungicide Fluazinam.
Grande Paroisse, Elf-Atochem's fertiliser arm, has expanded into India, linking up with Hindustan Dorr-Oliver to offer technology for the upgrading of phosphatic fertiliser plants.
At home, Total's resins business is expanding its speciality acrylic capacity in France and the US to meet growing demand for UV and electron beam photo cure systems. A new production site is being built for acrylic specialities in Virginia, in the US, and a plant is just onstream at Villers Saint Paul in France.
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