Eastman makes PET resin production breakthough
terephthalate (PET) for packaging, claims to have made a
breakthrough in the manufacture of PET resin.
The company is set to build a 350,000 metric ton integrated PET manufacturing facility using new IntegRex technology at its existing site in Columbia, US. Eastman's existing purified terephthalic acid facilities will be retrofitted using additional elements of IntegRex to supply intermediates for the expansion.
The company said that it expects to receive patents on more than 100 process and product innovations surrounding this technology, which encompasses manufacturing process integration from paraxylene (PX) to PET.
"IntegRex is a major innovation in paraxylene to PET production technology," said Eastman chairman Brian Ferguson. "Building on our established strength in chemical process innovation and our recognised excellence in polyester technology, Eastman has developed a technology that we believe will set us apart as the leader in the manufacture of PET resin."
PET packaging industry growth rates are driven by continued strong demand for bottled water, the expansion of niche carbonated soft drink markets and new packaging applications for PET. Industry analysts project PET packaging industry growth rates will require new capacity to be available for consumption in North America by late 2006.
Indeed, the plastic rigid food packaging market in North America reached about 10.3 billion pounds in 2003, and is expected to increase to over 13.6 billion pounds by 2008 at an AAGR (average annual growth rate) of 5.8 per cent. According to Business Communications Company's RP-184 Rigid Food Packaging, PET is the dominant resin at 5.8 billion pounds and its use is rising faster than the total market, at an AAGR of 6.4 per cent.
We have made a technology investment that completely redefines the PX to PET manufacturing process, allowing us to meet future market demand with the most advanced technology," said Allan Rothwell, Eastman executive vice president, and Voridian division president.
"The competitive advantage this technology provides our PET business will enable us to strengthen our leadership position in the polyesters for packaging industry and is a key element in our integrated polyester strategy."
Increasing the supply of polyethylene may eventually help to stabilise prices. The cost of packaging has rocketed due to increases in the cost of raw materials - natural gas, a starting point for the production of about 70 per cent of North American polyethylene - has shot up.
As a result of this adverse supply-demand balance and the rise in production costs, chemical companies across the globe have been forced to increase the price of polyethylene. Dow for example raised the price of all grades of its low-density polyethylene (LDPE) resins and high-density polyethylene (HDPE) resins by €120 a ton.
"Our price increases in 2004 have not compensated for the tremendous rise in raw material costs during the first half of this year," said Markus Wildi, commercial vice president for Dow's plastics portfolio in Europe, the Middle East and Africa. "Additional increases in raw material costs during Q3, as well as unusually high oil prices, have further eroded our margins."
Increasing production is therefore one way of addressing the supply-demand situation, but chemical firms have limited control over the rise in raw material costs.
Nevertheless, Eastman is ploughing $100 million into this new production facility.
Contracts for construction of the new plant will be awarded in December with the full capacity on-line by the fourth quarter, 2006.
Eastman manufactures and markets plastics, fibres and chemicals. The company has 12,000 employees and had 2003 sales of $5.8 billion.
