MOSCOW (MRC) -- Trinseo SA has decided against the divestment of its polycarbonate (PC) resin operations in Stade, Germany, reported PlasticsNewsEurope with reference to the company CEO and president Frank Bozich.
The Bervyn, Pennsylvania-based supplier of plastics, synthetic rubber and latex binders disclosed in May that it was evaluating "strategic alternatives" for the PC business in northern Germany, which is Trinseo’s only polycarbonate manufacturing facility globally.
"Our primary goal of this evaluation was to ensure that we have a reliable and cost-effective supply of high-quality polycarbonate for our higher margin compounding businesses, which consumes approximately 40% of our polycarbonate production," explained Bozich during an earnings call 4 Nov.
After exploring "numerous options", the company concluded that the best option was to remain in operation at the site, which would offer "significant structural and raw material cost savings."
The savings, according to Bozich, will be a significant contributor to the USD20-30m savings that the company identified in a recent restructuring measure.
The move will also better support Trinseo’s growing sales to the higher margin medical and consumer electronics applications.
The Stade plant, in operation since 1990, includes a polymer production unit and a compounding facility, manufacturing approximately 120 polycarbonate products for various applications, according to the Trinseo website.
The plant, according to Trinseo has roughly 3% of total global capacity, and has to compete with increasing supply from China at a time of low demand.
As MRC informed before, Trinseo and its affiliate companies in Europe last announced a price increase for all polycarbonate (PC) grades in September 2019. Thus, effective September 3, 2019, or as existing contract terms allow, the contract and spot prices for the products listed below increased as follows:
- CALIBRE PC resins - by EUR100 per metric ton.
According to ICIS-MRC Price report, Russia's estimated PC consumption rose in in the first three quarters of 2019 by 11% year on year to 61,000 tonnes (54,800 tonnes a year earlier). Consumption in the injection moulding sector grew in the first nine months of 2019 by 10% year on year to 7,900 tonnes from 7,200 tonnes a year earlier.
Trinseo is a global materials company and manufacturer of plastics, latex and rubber. Trinseo's technology is used by customers in industries such as home appliances, automotive, building & construction, carpet, consumer electronics, consumer goods, electrical & lighting, medical, packaging, paper & paperboard, rubber goods and tires. Formerly known as Styron, Trinseo completed its renaming process in 1Q 2015. Trinseo had approximately USD4.6 billion in net sales in 2018, with 16 manufacturing sites around the world, and approximately 2,500 employees.
MRC