BASF NYLON LOOKS TO THE EAST

Byline: M.McN.

NEW YORK--BASF expects to be producing textile nylon in China within the next eight years.
That's the word from Charles A. Kale, BASF Corp.'s director of nylon textile products, who said while no firm plans have been established, a joint venture to produce textile nylon in that part of the world is a key part of the company's overall strategy, which has been laid out through the year 2003.
Last week, BASF, which wanted for years to establish fiber production in the Far East, announced its first steps toward achieving that goal, a venture in China.
As reported, BASF AG, China Worldbest Development Corp., the Pudong Development Bank and the administrators of something called the China Textile International Science and Technology Industrial Town of Qingpu County--a textile production and research area in China headed by a combination of private concerns and the Chinese government--have agreed in principle to form a joint venture for the manufacture and sale of nylon 6 bulked continuous filament (BCF) carpet fibers and polymers.
BASF Corp. will be the representative of BASF AG in operating the venture.
"It's the right thing for us to do," said Kale, referring to the prospect of textile nylon production in the Far East. "It's time to look beyond our borders."
While parent company BASF AG has been selling raw materials--caprolactam and polycaprolactam--to the Far East for several years, to date, BASF Corp. had not been aggressively pursuing that area for textile filament nylon.
Walter Hubbard, BASF's group vice president, fiber products, said when it came to production, BASF chose to pursue a joint venture, rather than build its own plant "because you need a local partner to get your contacts in the business community."
"It's almost impossible to do it alone," he added.
The move to Southeast Asia would be the latest in a series of moves that BASF has taken to solidify its nylon position and to divest itself of all other fibers.
In July 1992, BASF sold its rayon production facility at Lowland, Tenn., to Lenzing Fibers Corp.
In April 1993, BASF combined the fibers division of BASF Corp. and the fiber raw material division of BASF AG, Ludwigshafen, Germany, renaming it the fiber products division of BASF Corp.
In August 1993, BASF revamped the management of its nylon businesses by creating a team concept, with executives getting input from all elements of the operation, from raw materials to marketing. The team is made up of several BASF executives from all parts of the fiber products business, and the aim is to speed up decision-making and improve responsiveness to customers.
In August 1994, after failing to find a buyer for its polyester business, also at Lowland, BASF closed the manufacturing operation there.
Discussing the moves, Kale said, "The performance team has been crucial to maintaining our progress in nylon. It is market-oriented and allows us to be more efficient in the operation.
"Putting the raw materials and textile nylon business together gives us a real reason to establish production [in China]," Kale added. "We could have sat here in the U.S. and dreamed about a world market. We have to go out and get it."
BASF produces 60 million pounds of textile filament nylon, all of which is type 6 nylon used primarily for apparel and hosiery applications. It also produces 165 million pounds of nylon staple, which is used in carpet production, and 260 million pounds of BCF nylon, also used in carpets.
"The divestiture of rayon and polyester has allowed us to move closer to our core business, type 6 nylon," Kale said. BASF's nylon plants are at Clemson and Anderson, S.C.; Sylvania, Ga.; Enka, N.C.; Freeport, Tex., and Lowland.
BASF AG also has facilities in Antwerp, Belgium; Sea Sands, England, and Ludwigshafen.
In 1993, the fibers division constituted $967.5 million of BASF Corp.'s $5.2 billion in sales. BASF AG's 1993 worldwide sales were about $25.9 billion. Of that figure, about $6 billion came from fibers and intermediates for fibers, plastics and chemicals.
"As far as where we want to be in our nylon business, I think we're ahead of schedule," said Kale. "We are not looking as seriously in other areas as we are in the Far East for nylon opportunities. That's where the growth is going to come from."

To Read the Full Article
SUBSCRIBE NOW

Tap into our Global Network

Of Industry Leaders and Designers

load comments
blog comments powered by Disqus