EPCA 2000: India's Laxmi to boost ethyl acetate output

01 October 2000 13:12  [Source: ICIS news]

MONTE CARLO, Monaco (CNI)--Laxmi Organic Industries, India's largest manufacturer of ethyl acetate, is planning to increase its production capacity from 30 000 tonne/year to 50 000 tonne/year, joint managing director Rajeev Goenka told CNI here on Sunday.

He said Laxmi will be investing about $9m (Euro10.2m) on expanding its plant at Mahad, just south of Bombay, with the additional 20 000 tonne/year of capacity due on stream in 2003.

Part of the Goenka chemicals, paper, natural products and building materials group, Laxmi has its own production of acetic acid with a capacity of 15 000 tonne/year. It also buys about 7000 tonne/year to meet captive and trading needs.

Goenka, who was speaking at the European Petrochemical Association (EPCA) annual meeting (which runs through Tuesday 3 October), said Laxmi planned to support the ethyl acetate expansion with a distillery with a capacity of 50 million litres/year of alcohol.

Laxmi's ethyl acetate plant is currently running at about 24 000 tonne/year, of which 16 000 tonne/year is currently sold to the domestic market and 8000 tonne/year is exported.

Goenka said the expansion programme will raise Laxmi's share of Indian ethyl acetate production from about 30% to a potential 48% of an estimated total projected output of 104 000 tonne in 2003. It will also raise Laxmi's share of the Indian domestic ethyl acetate market from 26% (or 16 000 tonne) in 2000 to 33% (or 25 000 tonne) in 2003.

Laxmi's share of ethyl acetate exports from India will also rise significantly, from 44% (or 8000 tonne) this year to an estimated 67% (or 18 000 tonne) in two to three years time.

Goenka explained that the Indian market for ethyl acetate was being driven largely by vigorous growth in flexible packaging, although there was also strong expansion in demand for paints and adhesives.

He said Laxmi has no plans to raise its acetic acid production capacity but is looking to form alliances with strong international players who can offer a long-term supply of the feedstock. Goenka is particularly interested in exploring relationships with companies that both wish to increase their presence in the Indian, Southeast Asian, Middle Eastern and African ethyl acetate markets, and which can offer Laxmi opportunities to expand in Europe and elsewhere.

By: Neil Sinclair
+44 20 8652 3214

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