Neste Reduces Adhesive Resins

16 March 1998 00:00  [Source: ICB Americas]

Neste Chemicals is reducing its adhesive resins capacity in the Netherlands by 25 percent in response to overcapacity in the European market. The company says an oversupply of adhesive resins is tightening margins and reducing profits despite growing demand.

Neste is closing a 100,000-metric-ton resins unit at Europoort, Rotterdam, where the company will continue to produce formaldehyde. A 100,000-ton resins plant at Delfzijl will be expanded by 50,000 tons per year.

The company has a total European capacity of around 600,000 tons per year in adhesive resins, in which it claims to be the global market leader. Neste has a total annual capacity of 1.2 million tons in North America, including Mexico.

Krems Chemie, the Austrian resins producer that Neste acquired last year, operates more than half of the company's European capacity. Meanwhile, BASF is planning to expand its capacity for solvent-free acrylate contact adhesives by the end of the decade.

It is selling its business in solvent-based acrylate contact adhesives to ICI's National Starch & Chemical. BASF will continue to produce these adhesives at Ludwigshafen for National Starch until the end of 1999, when the freed capacity will be used for making aqueous dispersions or UV-crosslinkable hot-melt adhesives.

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