In this week's Chemical Market Reporter

11 December 2000 00:30  [Source: ICIS news]

Top Headlines

Investor spotlight shines on debt

As the US chemical industry heads into a period of slowing economic growth, compounded by persistently high raw material and energy costs and the weak euro, companies with relatively low debt levels are poised to weather the storm. Companies with heavy debt loads have seen their profitability clobbered this year, exacerbated by high interest payments in the face of exceedingly difficult market conditions.

Eastman to double 2-EH acid capacity

Eastman Chemical is planning a major expansion of its capacity for 2-ethylhexanoic (2-EH) acid through a debottlenecking project at its dedicated manufacturing facility in Kingsport, Tennessee. The expansion will effectively double Eastman's annual 2-EH acid capacity from 18 149 tonne/year to 36298 tonne/year by late 2001.

Bayer forges ahead on global polycarbonates

Bayer is positioning itself as the world's leading producer of polycarbonate by 2005 through investments of nearly $890m (Euro1bn) that started in 1999. The investments will double the company's current capacity of 650 000 tonne at five global sites.

ICI sells last industrial chem operations to Ineos

ICI has agreed to terms for the sale of its chloralkali, Klea fluorochemicals and Crosfield silica-derivatives businesses to Ineos of the UK, which last year took over ICI's acrylics business. The agreement covers the last of the industrial chemical operations to be divested since ICI became a specialty chemicals manufacturer after its acquisition of Unilever's chemicals businesses three years ago.

Arch projects healthy '01 despite earnings revision

Speaking to investors at the 11th Annual Chemical Industry Conference in New York City, Michael Campbell, top executive of Arch Chemicals, acknowledged the company's revised earning expectations for the fourth quarter but he projected strong revenue and operating margin trends for 2001.

USDA reviews Aventis's conduct over StarLink

The US Department of Agriculture (USDA) is reviewing Aventis CropScience's conduct in allowing StarLink, an unapproved variety of biotech corn, to enter the nation's corn supply. Activists are calling on the government to fine Aventis or otherwise penalise the company for failing to ensure that genetically modified StarLink was used only for industrial or animal feed applications.

In the News

BASF, Sinopec to construct China petro jv

BASF and the China Petroleum & Chemical Corporation (Sinopec) have received a business license to establish a joint venture that will build and operate an integrated petrochemicals plant in Nanjing, China. BASF-Yangzi Co Ltd, the 50:50 joint venture formed between the two companies, will make a total investment of $2.6bn.

USDA moves for improved GM tracking

The US Department of Agriculture (USDA) is considering ways to improve the tracking and detection of genetically modified (GM) crops because of problems with StarLink, an unapproved variety of biotech corn that inadvertently got into the food supply, says a top official. Agriculture Secretary Dan Glickman says his department will seek public comment on steps to facilitate the marketing of GM crops and to keep them separate from conventional food.

Korea's LG Chem continues life sciences push

LG Chemical, South Korea's largest chemical company, is continuing its push into the life sciences by forming a strategic alliance in cancer research with Gene Logic, a provider of genomic information based in Gaithersburg, Maryland.

CSMA changes its name to CSPA

To reflect its changing focus, the Chemical Specialties Manufacturers Association (CSMA) is changing its name to the Consumer Specialty Products Association (CSPA). The organisation expects its newest incarnation to enable it to adapt to the latest industry trends, including globalisation, mergers and acquisitions and the increasing impact of the Internet on sales and communications.

Ecolab buys remaining stake

Ecolab has agreed to acquire the remaining 50% of the joint venture between Henkel KgaA and Ecolab, Henkel-Ecolab. Ecolab will pay Henkel, in either cash or Ecolab stock, roughly 11 times Henkel's 50% share of the joint venture's average operating income before interest and taxes for the years 2000 and 2001 or about $460m-490m.

Cabot Microelectronics doubles capacity

Cabot Microelectronics will expand the manufacturing capacity of its plant in Oazo-Kitakoyama Industrial Park, Geino, Japan, by 100%. The new 73 000-square-foot addition is the second such expansion of the facility since it opened in January 1999 in response to growing demand in Asia-Pacific. The company expanded the manufacturing capacity of the Geino facility by 150% just a year ago.

Degussa-Huls builds new plant

Degussa-Huls is constructing a new industrial carbon black plant in Paulinia near Sao Paulo, Brazil. The plant will have a capacity of about 60 000 tonne/year of rubber carbon black in the first phase of development with production by 2002.

Finnish Chemicals buys Huron Tech

Finnish Chemicals Oy, Aetsa, Finland, is buying Jacksonville, Florida-based Huron Tech. Both companies are key producers of chemicals for the pulp and paper industry in Europe and North America. Huron Tech manufactures sodium chlorate at facilities in Augusta, Georgia and Eastover, South Carolina. Equipment fabrication, research and development and administration are based in Delco, North Carolina; Jacksonville, Florida; and, Kingston, Ontario in Canada. The pulp and paper chemicals business will operate under the Finnchem umbrella. Finnish Chemicals fine chemicals unit, Delicato Chemical, will continue to operate as a separate entity.

Elementis receives possible takeover bid

Elementis disclosed last week it has "received a speculative approach from a financial buyer concerning its potential interest in making an offer for the company." The UK specialty chemicals producer has been the subject of takeover speculation since Laporte's specialty chemicals operations were sold in September to Kohlberg Kravis Roberts, the private equity investor, for $1.2bn.

EPA proposes $460m plan to clean Hudson River

US Environmental Protection Agency (EPA) Administrator Carol Browner last week proposed a $460m plan to remove polychlorinated biphenyls (PCBs) from portions of the upper Hudson River. Under the agency's proposal, 2.65m cubic yards of sediment would be dredged from so-called PCB hot spots along a 40-mile stretch of the river north of Albany, New York. EPA said the PCB contamination of the Hudson dates back to a 30-year period ending in 1977 during which General Electric (GE) discharged as much as 590 tonne of PCBs directly into the river from New York facilities in Hudson Falls and Fort Edward.

Norsk Hydro withdraws from fertiliser jv

Norsk Hydro has pulled out of a joint venture in Jordan for the production of 1.2m tonne/year of nitrogen-phosphorous-potassium and phosphate fertiliser, one of that country's largest industrial projects. The venture, a partnership between Hydro and the state-controlled Jordanian Phosphate Mines, was scheduled to produce 440 000 tonne/year of phosphoric and sulphuric acid at Eshidiya plus phosphate fertilisers at Aqaba. That output would have been mainly exported to Asia.

Pyrethroid insecticide makers plan risk research

Manufacturers of pyrethroid insecticides plan to conduct research on their cumulative risk to support the continued registration and use of the pesticides. The research by the Pyrethroid Working Group will be submitted to the US Environmental Protection Agency (EPA) for use in 2003, when the agency will need to determine whether there is a common mechanism of toxicity for some or all of the pyrethroids.

Science-based decision-making under fire

The scientific community faces growing challenges to traditional science-based decision-making and needs to adopt new approaches for developing, managing and communicating scientific information to reach better decisions, a senior chemical industry official said last week.

Major Markets

BASF plans further expansions in vitamins

SB-Latex producers look to restore margins

High-intensity sweeteners look for new synergies

Dot.com fallout not yet deterring chemical e-commerce

Roundup's US patent expiration creates glyphosates uncertainty

FTC probes SKB's Paxil for anti-competitive behaviour

Pennzoil, Crompton top latest restructuring moves in oils

Ethylene producers wary as US economy slows

Dye and pigment producers embrace new technologies

Nutritional supplements market faces slowing growth

Further News

Biotech industry plans legislative attack

EPA phases out pesticide Diazinon

Syngenta cites declining margins

Waste delisting considered for Eastman site

EMS-Chemie bids to buy Axantis

EPA extends phaseout date for methyl bromide

Omnexus completes its first online transaction

Vigon International offers strategic partnership model

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ICIS Copyright © Reed Business Information 2009

Author: Gary Taylor
+1 713 525 2653

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