The research report titled "Fermentation Chemicals: A Global Strategic Business Report" by Global Industry Analysts, Inc. states that the global market for Fermentation Chemicals is projected to reach US$52.7 billion by 2017. Growth in the market remains bright, driven primarily by the eco-friendly nature of these chemicals.

Fermentation process involves large scale cultivation of bacteria or fungi that transform renewable raw materials into chemicals. Key factors that advocate the use of fermentation process as compared to other processes include lesser consumption of solvents, reagents and power for manufacturing chemicals. Growth in the market for fermentation chemicals is favored by development of new products and applications.

As stated by the new market research report on Fermentation Chemicals, the US represents the largest market for Fermentation Chemicals, while Asia-Pacific and Latin America represent the fastest growing markets. With about 700 odd companies and hundreds of other small companies, China has become a major manufacturing hub for biotech industry that includes amino acids, methionine, citric acid, and various other fermentation chemicals. Among the segments analyzed, ethanol represents the fastest emerging fermentation chemical, replacing MTBE from the gasoline category. Eco-friendliness, cost-efficiency, and the ability to meet existing regulations are the major factors propelling the demand for ethanol. The global citric acid market is predominated by the US and Western Europe, with China emerging as a major consumer in recent years. Demand for vitamins continues to stem from the Food and Beverages industry. Future demand for industrial applications of lactic acid, its esters and salts are likely to emanate from lactate solvents and lactic acid based biodegradable polymers.

ACQUISITIONS

BASF Increases Wind Power Expertise with B.C. Foam Acquisition

BASF says it is expanding its portfolio for wind power with the acquisition of the PET form business of B.C. Foam.

The acquisition includes production facilities and intellectual property rights, as well as a special extrusion process, which enables the production of high-performance PET foams with very high densities, says BASF.

“By expanding our portfolio of sophisticated structural foams, this acquisition will enable BASF to further strengthen its position as a leading foam provider,” Dr Wolfgang Hapke, president of BASF’s Performance Polymers division, said in a statement. “These PET foams are primarily used in wind turbine rotor blades and will extend our product range for the growing global wind energy market.”

The companies did not disclose any financial information.

IVL to Purchase PET Resin Facility of PT Polypet Karyapersada

Indorama Ventures (IVL) has signed a definitive asset purchase agreement to acquire a polyethylene terephthalate (PET) resin facility from PT Polypet Karyapersada, located in Cilegon, West Java, Indonesia.

The PET facility, situated adjacent to the purified terephthalic acid (PTA) assets of PT Indorama Petrochemicals, can produce up to 100,800 metric tons per annum (mtpa).

IVL said the assets will be held by its new indirect subsidiary, PT Indorama Polypet Indonesia, and the transaction of the deal is scheduled to be completed in the first quarter of 2012.

Indorama Ventures group CEO Aloke Lohia said: "This acquisition will further assist us to consolidate our position in the Indonesian market, while the co-location with Polyprima fits in with our integration strategy. The synergies created by integrating the two plants will lower costs through shared services and logistic cost saving and will be accretive to the bottom line.

"Indonesia is a fast-growing market for our customers with an attractive potential for future growth. Low energy and other costs make this a very attractive place for long term investment."

PET is a thermoplastic polymer resin used in synthetic fibers, beverages, food and liquid containers and thermoforming applications.

PET is also used as substrate in thin film and solar cells.

Arsenal Capital to Acquire Evonik Colorants Business

US private equity firm Arsenal Capital Partners has entered into an agreement to purchase the global colorants business from Evonik Industries.

Evonik's colorants business develops, produces and markets the Colortrend brand of paints for decorative end-use applications in the architecture sector.

Evonik also makes Chroma-Chem products for use in industrial applications such as maintenance, marine and timber coatings.

Arsenal specialty industrials group co-head and partner John Televantos said: "We are delighted with the opportunity to acquire a leading global business in the colorants space. The business has a strong reputation because of its people, technology, quality and service.

"It provides a great platform to build a stronger global business in a sector that we understand and believe it will perform well as an independent company benefiting from Arsenal's resources and expertise.

"We look forward to supporting and building the business organically and with strategic acquisitions that will further expand its network."

The transaction is scheduled to be closed in April 2012.

Evonik's production plants are located in Lockland, Ohio, US; Maastricht, Netherlands; Dandenong, Australia and Brampton, Canada.

Arsenal Capital said it makes investments in chemical, middle-market specialty industrial, healthcare and financial services companies with revenues ranging from $30m to $400m.

Dow Chemical Sells European Fungicide Business to Indofil

India-based Indofil Industries has acquired the European Dithane fungicide business of Dow AgroSciences, a subsidiary of Dow Chemical.

As per the agreement, Indofil has gained the rights and associated trademarks of Dithane products sold in Europe, but not other parts of the Dow AgroSciences' Dithane business.

Indofil has also gained exclusive rights to use the patented NT technology and related trademarks in Europe, Dithane registrations and data to support these, and customer contracts which can be assigned.

Dow AgroSciences Global Fungicide business leader David Hindes said: "Dow AgroSciences remains committed to the Dithane business in other parts of the world where we have production assets and are better able to compete over time. This divestment will allow us to focus our European investment on new novel chemistries in the future.

Indofil, a part of India's K.K. Modi Group, is involved in manufacturing and distributing Dithane in India, under Rohm and Haas.

Indofil Industries CEO R.K. Malhotra said the company is committed to grow the Dithane market across Europe through active collaboration with all partners.

K.K. Modi Group Chairman K.K. Modi said: "This is an exciting time for Indofil Industries in Europe, consolidating Indofil's position in the European mancozeb market segment and making it a leading player."

Financial terms of the deal have not been disclosed.

EXPANSIONS

Chemtura Breaks Ground on Petroleum Additives, Urethanes Facility in China

US-based specialty chemicals firm Chemtura recently held a groundbreaking ceremony for its new, multipurpose manufacturing facility in Nantong, China.

The Nantong facility in Jiangsu Province, first announced in June 2011, will be operational within the next two years with four production units supporting Chemtura’s industrial performance products segment, which includes its petroleum additives and urethanes businesses.

The first production unit expected to be operational in the fourth quarter of 2013.

There also are plans to manufacture additional products in future phases, the company said.

This facility will be Chemtura’s largest single investment since its formation in 2005 and the centerpiece site for manufacturing in Asia-Pacific, and specifically in China, the company said.

The investment is being made over a three-year period.

“This project is a huge step forward and a statement to our customers and investors that we are truly committed to our growth strategy in the world’s fast growing regions,” said Craig A. Rogerson, Chemtura CEO.

“We are going to make a broad array of our leading-edge products at Nantong in order to be closer to our customers, to shorten the timeframe for new product development and commercialization in the region, as well as to shorten the supply chain for these growing markets.”

The state-of-the-art Nantong facility will include production lines, administrative and maintenance buildings, utilities, a centralized control room, and quality control labs.

The petroleum additives business requires local manufacturing and storage capabilities for some of its product lines in order to meet customer demand, Chemtura said.

These include synthetic finished fluids (refrigeration lubricants, air compressor lubricants and gear oils), and calcium sulfonate grease.

Local manufacturing capacity for synthetic lubricants is required for the business to respond to the market’s demand for shorter lead times.

Installation of grease capacity in China will provide Chemtura’s customers with a more secure global supply capability, and will place capacity in the region with the highest growth rate, the company said.

Growth in the urethanes business, including its low-free (LF) prepolymer urethanes, is driven by the commercialization of Chemtura’s high-performance, greener Adiprene Duracast product line coupled with increasing global and regional demand for its LF products, according to the company.

Additional LF prepolymer manufacturing capacity in China will allow Chemtura to continue to grow its most advanced product lines and places capacity in a region with strong demand growth, while preserving existing capacity elsewhere to continue supplying customers in other regions.

In addition to the planned development of local manufacturing capacity, Chemtura said it plans to continue to build global scale through investing in sales representation, technical development centers, joint ventures and bolt-on acquisitions.

Asahi Kasei Chemicals to Construct New Acetonitrile Plant in South Korea

Asahi Kasei Chemicals will build a new acetonitrile plant at the site of Tong Suh Petrochemical's Ulsan plant grounds in South Korea.

The new plant, with a production capacity of 11,000 tons per year, is expected to come onstream in January 2014.

The proposed acetonitrile plant will use crude acetonitrile byproduct from other acrylonitrile plants in Korea.

The facility, along with the company's Japanese acetonitrile plant, will help Asahi Kasei Chemicals to meet the growing demand for acetonitrile.

Produced by refining the crude acetonitrile obtained as a by-product of acrylonitrile, acetonitrile is used to manufacture pharmaceuticals and agrichemicals.

Asahi Kasei Chemicals operates an acetonitrile plant in Kawasaki, Kanagawa, Japan, which has a production capacity of 14,000 tons per year.

The company is currently building a new acrylonitrile plant in Ulsan with start up slated for January 2013.

PETRONAS and BASF Move Ahead With Expansion of Partnership in Malaysia

PETRONAS and BASF have taken the next steps in the development of the previously announced €1 billion investment that will expand their partnership in Malaysia, involving projects at their existing venture in Kuantan and at a new site within PETRONAS’ proposed Refinery & Petrochemical Integrated Development (RAPID) complex in Pengerang, Johor.

These projects are to be implemented between 2015 and 2018.

The two partners today entered into a "Heads of Agreement" (HOA) for the development of the new project in Pengerang, signed by Dr. Martin Brudermueller, Vice Chairman of the Board of Executive Directors, BASF SE, and Datuk Wan Zulkiflee Wan Ariffin, Executive Vice President of Downstream Business, PETRONAS.

Under the terms of the HOA, the partners have agreed to form a new entity (BASF 60%; PETRONAS 40%) to jointly own, develop, construct and operate production facilities for isononanol, highly reactive polyisobutylene, non-ionic surfactants, methanesulfonic acid, and plants for precursor materials. These world-scale facilities will become an integral part of PETRONAS’ RAPID project.

PETRONAS - through its subsidiary PETRONAS Chemicals Group Bhd - and BASF are also making progress with the feasibility study to expand the operation of BASF PETRONAS Chemicals Sdn Bhd in Kuantan. The two partners are considering the expansion of their C3 value chain with a new plant for superabsorbent polymers, as well as the expansion of the production capacity of their existing glacial acrylic acid unit. BASF PETRONAS Chemicals (BASF 60%; PETRONAS 40%) was founded in 1997. The company currently operates an integrated complex with acrylic monomers, oxo products and butanediol production facilities at the Gebeng Industrial Zone, Pahang.

“With our new development in Pengerang and the expansion of the “Verbund” site in Kuantan, we will be able to improve supply to our customers in Asia Pacific with specialty chemicals that help meet the needs of a rapidly growing population, especially in the ASEAN market ,” said Dr. Brudermueller, who is responsible for BASF’s Asia Pacific operations. “At the same time these projects demonstrate the vitality and success of our sustainable partnership with PETRONAS.”

Datuk Wan Zulkiflee said, “ The development of a new specialty chemical products portfolio is an important component of PETRONAS' plan to facilitate the sustainable development of our downstream petrochemical business. This complements our integrated plan to become a key player in the region as well as to spur domestic investment in the oil, gas and petrochemical industries."

The chemicals to be produced at the new facilities will directly contribute to the sustainable development of the Asia Pacific region, especially in ASEAN. For example, nonionic surfactants are used in almost all cleaning applications, particularly in environmentally friendly laundry detergents as well as in technical processes, including as ingredients for auxiliaries in the textile and leather industry.

Methanesulfonic acid is utilised in many different applications wherever a strong, readily biodegradable and low-corrosive acid is needed, such as for use in detergents, electroplating, and chemical synthesis.

Isononanol is a feedstock for the production of plasticizers, which are used in a variety of industries including construction and automotive. Superabsorbent polymers are the key ingredients in disposable diapers and adult hygiene products.

Wacker Expands Polymer Site in China

Wacker is expanding the site’s existing facilities for vinyl acetate-ethylene copolymer (VAE) dispersions and is also building a new plant to produce polyvinyl acetate (PVAc) solid resins.

Wacker is investing around EUR 40 million in building two new production facilities at its Nanjing site.

Wacker Chemie AG is expanding its Chinese polymer activities by investing around EUR 40 million in building two new production facilities at its Nanjing site. As announced by the Munich-based chemical group, it is expanding the site’s existing facilities for vinyl acetate-ethylene copolymer (VAE) dispersions by adding a new reactor with an annual capacity of 60,000 metric tons. This measure will double Nanjing’s VAE dispersion capacity to approx. 120,000 metric tons per year, making the complex one of the biggest of its kind in China. The new reactor is scheduled to come on stream in mid-2013. At Nanjing, the company is also building a new plant to produce polyvinyl acetate (PVAc) solid resins with an annual capacity of 20,000 metric tons. This plant is due for completion in early 2013.

Lanxess to Build New Neodymium Polybutadiene Rubber Plant in Singapore

Lanxess will build a new neodymium polybutadiene rubber (Nd-PBR) plant at Jurong Island Chemical Park, Singapore.

The €200m plant is expected to produce 140,000 metric tonnes per annum (tpa) of Nd-PBR, which will be used in the treads and sidewalls of green tires.

Nd-PBR will also be used for the modification of plastics in the manufacture of high-impact polystyrene (HIPS) for injection molding applications.

The plant, which is scheduled to start operations in the first half of 2015, will use Butadiene as the raw material.

As part of the construction, Lanxess has signed long-term agreements with Petrochemical Corporation of Singapore (PCS) and TP Utilities, a wholly-owned unit of Tuas Power, for supplying the required raw material for the construction of the facility.

PCS is constructing a new butadiene extraction unit and associated infrastructure necessary to provide the raw material.

Lanxess said it will break ground at the Nd-PBR facility on 11 September 2012.

Hitachi Chemical Subsidiary Boosts Production Capacity for Powder Metal Products

Sintering Technologies Inc. (STI), a powder metal products manufacturing subsidiary of Hitachi Chemical Co. Ltd, has increased by 150% its production capacity of valve timing control system component in response to increasing demand from the North American auto market. As of April 1, STI will change from its current name to Hitachi Powdered Metals (USA) Inc. and will aim to further expand its business and improve its services.

STI has been manufacturing and distributing powder metal products for vehicles as a wholly owned subsidiary of Hitachi Powdered Metals Co. Ltd, which is a wholly owned subsidiary of Hitachi Chemical, since 1995 after originally being established as a joint venture company of Hitachi Powdered Metals and a local company in 1987. STI's strength is its engine component technology, particularly that of its valve guide.

In an effort to strengthen synergy within the Hitachi Chemical Group on a global scale, a variety of measures and policies has been implemented. As a part of these initiatives, Hitachi Chemical has decided to change the name of STI to Hitachi Powdered Metals (USA) as of April 1 to associate the company with Hitachi Chemical and raise its profile within its market and customer base.

Ashland Commissions New RDP Production Line

Ashland, a producer of cellulose ether, has commissioned a new Aquapas redispersible powders (RDP) production line at its manufacturing campus in Nanjing Chemical Industrial Park, China.

The RDP production line follows the start-up of Natrosol hydroxyethylcellulose (HEC) production in Nanjing in 2010.

RDP, when combined with the company's cellulose ether line of products, can increase the efficacy of dry mortar applications, including external insulation and finishing systems, external skim coats, cementitious tile adhesives and self-leveling compounds.

The US-based company is also planning to introduce its water-soluble polymers product line, which includes cellulose ether and RDP products, in the next few months.

Ashland chairman and CEO Jim O'Brien said: "Today, nearly half of our sales come from outside the US and approximately 20% of sales come from the rapidly growing Asia Pacific and Latin American regions. Growth in these markets is key to our long-term success, and we will preferentially allocate resources to these areas.

"Within our high-growth Specialty Ingredients business alone, we plan to invest approximately $600m over the next three years to support our planned growth in key regions that include Asia Pacific."

Ashland Specialty Ingredients president John Panichella said the launch of the RDP production line in Nanjing shows the company's commitment to the construction market in China and Asia Pacific.

"Our goal is to expand our leadership position and to remain actively involved in the growth of the Chinese construction market by providing the most advanced products and innovative technologies," said Panichella.

Ashland provides the specialty chemicals and technologies to a variety of markets and applications, including architectural coatings, automotive, construction, energy, food and beverage, personal care, pharmaceutical, tissue and towel, and water treatment.

Clariant Begins Building New Research Centre

Chemicals giant Clariant has started construction work on a new €100m research centre in Frankfurt, Germany.

When completed, the centre will comprise 36,000m² of office and laboratory space and will provide jobs for 500 researchers.

Spokesperson Christian Kohlpaintner said the centre will focus on functional materials, energy efficiency and renewable raw materials.

“We want to develop products and procedures that yield sustainable benefits and represent true progress,” he said.

Solvay Selects Jacobs for Specialty Polymers Production Plant

Solvay has chosen Jacobs Engineering Group to build a specialty polymers production plant at its Changshu industrial site, located in the province of Jiangsu, China.

The contract value is estimated to be approximately $9m.

Jacobs is carrying out the engineering, procurement and construction management (EPCM) services contract through its operations in Shanghai, China.

Solvay will invest approximately $160m into the new plant, which is expected to become operational in the first quarter of 2014.

The new plant will produce products including SOLEF PVDF, TECNOFLON FKM and essential VF2 monomer.

Jacobs Engineering Group vice president Tom Quinn said: "We look forward to contributing to this large and significant project for Solvay, drawing upon our strong, sector-relevant technical and project management skills to support the project."

Jacobs offers scientific, specialty consulting, engineering and construction, operations and maintenance services in the fields of automotive,industrial,chemicals and polymers, mining and minerals, gas, refining and technology.

Solvay Chemicals manufactures soda ash, hydrogen peroxide and sodium bicarbonate, specialty products such as fluorinated chemicals.

McIlvaine Company

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