Archives

November 2006

Chemical Information Services Offers Free Trials After 35 Years

For the first time in 35 years, Chemical Information Services is offering free trials to its directory services. Those who request a trial through the CIS website will be able to use the Directory of World Chemical Producers (DWCP) as well as the 4 other directories that the company publishes. The different directories published by CIS have been helping the global chemical and pharmaceutical industries source and market chemicals world wide for more than three decades. In this first time offer, companies can have access to accurate global information on manufacturers and users of all types of chemicals and API's. This is a dramatic change in policy which has been in force for more than 30 years. CIS Managing Director Ron Schwarz says, "the reason for the change is that today, finding reliable producers, not traders, for sourcing chemicals and API's is not easy. Many buyers spend hours on the internet sifting through web sites only to come up with unreliable sources or even worse, an incomplete list. These problems mean that they may be missing producers that can save them thousands or millions of dollars each year. In addition, producers are always looking for new customers for their products. What we have discovered over the years is that people don't know how truly valuable and indispensable our directories are until they actually start using them. We hope this policy change, offered without any obligation to the user, will actually get our directories into their hands so they can see all this for themselves." To access this free trial, click on the link on the right side of this page or visit the CIS homepage, www.chemicalinfo.com, and click on the "Request a Free 7 Day Trial" button.

			Famous Quotes of the Month - In any contest between power and patience, bet on patience. (W.B. Prescott) - The opposite of a correct statement is a false statement. The opposite of a profound truth may well be another profound truth. (Niels Bohr) - The secret of success is to know something nobody else knows. (Aristotle Onassis) - Luck is the residue of design. (Branch Rickey) - The clash of ideas is the sound of freedom. (Lady Bird Johnson)

			Why Is Yawning Contagious? No one knows the answer to this question for sure, but a study recently published in the journal "Cognitive Brain Research" theorizes that yawning in response to someone else's yawn maybe an empathic response, similar to laughter. Yawns can be triggered not only by seeing a person yawn but also by hearing, reading about, or even just thinking about yawns. Researchers believe that contagious yawning may be a primitive way of modeling our feelings after other people's feelings.

			BASF Forges Ahead Following Engelhard Acquisition With the acquisition of Engelhard, BASF now has two U.S. based headquarters offices, both in New Jersey. The company indicated that it will close one, and perhaps, both of these offices. No additional specifics were provided. The company expects to fully complete the integration of Engelhard operations by July 2007. Because there is little overlap between the two businesses, BASF is retaining former Engelhard managers to oversee important functions.

			Bayer Settles Price-Fixing Case U.S. district judge John Lungstrum announced that Bayer agreed to pay $18 million (Euro 14.3 million) to settle claims regarding its participation in a cartel to inflate the price of Polyester polyol-based products between 1998 and 2005. As part of the agreement, the company is also required to cooperate with attorneys in continuing suits against Uniroyal Chemical and Chemtura (previously Crompton). Bayer was fined Euro 58.9 million in 2005 for operating a rubber chemicals cartel with Crompton between 1996 and 2001.

			New Leader Takes Helm at Praxair Stephen Angel, currently president and COO, has been appointed CEO of Praxair, replacing Dennis Reilley at the end of 2006. He will take on the position of chairman as well when Reilly retires at the end of April, 2007. Angel became president and COO in February, 2006 after serving as executive vice president since 2001. Prior to working for Praxair, he served in various sales, marketing, and management positions at General Electric.

			IPOs on the Rise in Asia Despite increasing competition from the Middle East and predictions of an impending economic downturn for the Asian petrochemical industry, many Asian chemical firms are launching initial public offerings (IPOs). Most recently, polyurethane synthetic leather and microfiber producer Sino Techfibre announced that it hopes to raise $71.1 million (Euro 57.2 million, S$113 million) through a share sale on the Singapore Exchange. Union Petrochemical hopes to raise $0.91 million (Euro 0.73 million, Bt 34 million) on Thailand's Market for Alternative Investment Exchange. In September, China BlueChemical, a unit of China National Offshore Oil Corp, launched a $341.7 million (Euro 272.6 million, HK$2.66 billion) IPO.

			Albemarle Acquires DSM Facility Albemarle purchased DSM's South Haven, Michigan generic active pharmaceutical ingredients facility for an undisclosed sum. The acquisition is part of the company's strategy to "reposition the fine chemicals division around services and higher value activities," according to John Nicols, vice president for fine chemicals.

			More Changes for Rhodia Rhodia announced that it will sell its silicones business to China National BlueStar for an undisclosed sum. The sale fits with the company's strategy to divest non-leadership position businesses and reduce debt. Separately, Sanofi-Aventis announced that the company sold its 7.98 percent stake in Rhodia to French bank BNP for $229.6 million (Euro 183 million). BNP has already put the shares on the market through a private placement with institutional investors. Sanofi-Aventis will use the proceeds to pay down debt.

			Challenges for Biobased Ethanol Fuels The U.S. government has established a goal of producing 30 billion gallons of biobased Ethanol per year by 2030, but there are many challenges that must be overcome. Currently, 102 plants produce approximately 4 billion gallons annually, with 40 more facilities expected to be in operation by mid-2007 that will add 1.1 billion gallons of capacity. Another 125 plants producing 7 billion gallons of Ethanol have been proposed and could come onstream in the next five years. The entire volume, however, will be just 7.5 percent of total US gasoline consumption in 2006. Raw materials are an issue as well. If all available corn-growing land was dedicated for Ethanol production, it would lead to only 12 billion gallons, with none for animal or human consumption. Lignocellulosic (LC) materials (sugar, grain, trees and the like) will be a necessary additional source of biomass, but they provide less Ethanol per ton as compared to corn, and they are more expensive, with the price rising as demand grows. Conversion processes for LC materials are also more costly. Currently, around 55 cents per gallon of Ethanol cost is subsidized by the federal government. Lower costs are not expected until technology becomes more advanced but experts predict that will take another 10 years or so.

			Lonza Takes Action Lonza agreed to acquire the Research Bioproducts and Microbial Biopharmaceutical businesses of Cambrex for $460 million (Euro 367 million). Separately, the company announced that it will divest its polymer intermediates business Polynt via an initial public offering (IPO). With these steps, Lonza will fully implement its strategy to become a life sciences company. The purchase of Cambrex' bioproducts division should give Lonza access to high margin cell-based research products, endotoxin detection systems and cell-based therapeutic manufacturing capabilities, according to the company.

			Chinese Commodities: Weak Demand Leading to Lower Prices Chinese producers of Isopropanol (IPA) are lowering prices nearly 7 percent in response to weak demand and high inventory levels. Spot prices for purified Terephthalic acid (PTA) have fallen as much as 25 percent since early September. Despite the significant reductions, Polyester producers still face margin squeezes, as fiber prices have dropped along with PTA prices, and in some cases experienced further declines.

			European Benzene Spot Prices Higher Shortages of U.S. Benzene supply resulting from production problems at an American facility (according to market sources) have driven Asian prices higher, with European spot prices for Benzene following in kind. Recent deals for Benzene in Europe involved price increases of as much as 5 percent.

			Inventory Building Drives Demand for U.S. Methanol U.S. demand for Methanol has increased in recent weeks as prices drop and buyers look to replace low stock levels that resulted from limited supply during the summer months. Unexpected plant closures in late summer led to short supply and high prices for U.S. Methanol. Prices dropped in October and buyers responded positively.

			Middle East Faces Weak Demand for IPA Demand for Isopropanol (IPA) has declined in the Middle East, resulting in significantly lower prices. The availability of mixed alcohol, or "technical grade IPA," as a substitute is also hurting the IPA market in this region. Many players expect further declines in the coming weeks.

			Sulfur Market Could be Facing Devilish Times Rising production combined with lower demand in Asia could lead to significant excess supply in the global Sulfur market, according to Bill Kennedy, vice president of Sulfur business for Shell Canada Ltd. Overall he predicts a rise in excess Sulfur supply from 8 million tonnes in 2005 to 30 million tonnes by 2015.

			Tight Supply Leads to Higher Acetic Acid Prices in China Tight supplies of Acetic acid in China following the closure of the entire Jiangsu Sopo production facility after a recent explosion have led to dramatic price increases. The closure affected 600,000 tonnes/year of Acetic acid capacity. Prices rose as much as 10 percent in southern China. The company did not know when the plant would be operational.

			Plastics Markets Waver Globally Growth of the plastics market in the Middle East, which began in the early past of this decade, is expected to continue through 2010. Additional capacity for Polyethylene and Polypropylene will be likely in response to increasing demand and growing exports, particularly to Asia. From 2005-2006, PE capacity in the Middle East rose 17.7 percent and PP capacity grew 15.7 percent, according to Jacobs Consultancy. However, domestic prices in India for Polyethylene (PE) and Polypropylene (PP) dropped nearly 4 percent in response to decreasing demand. Price decreases and offers of price protection have been made with the hopes of encouraging more demand. The lower prices, however, coincided with declining crude and feedstock costs and did not create much interest. The peak holiday manufacturing season ended in September.

			Reach: Substitution Requirement New Issue A recent vote regarding Reach (registration, evaluation and authorization of chemicals) legislation by the European Parliament's Environment Committee includes a proposal requiring mandatory substitution for certain hazardous chemicals even if no alternative products are available. According to Cefic, Europe's chemical industry trade association, this requirement would lead to the banning of some substances and result in many manufacturers leaving Europe. The proposals must be approved during a plenary session of the European Parliament. Reach could take effect as soon as April, 2007.