The chemicals giant BASF is planning to build an engineering plastics compounding plant plus a thermoplastic polyurethane (TPU) plant at its site in Zhanjiang, China, where the company has already proposed to build an integrated chemical production facility.
Ultimately this site will be BASF’s largest investment, and will be the third-largest BASF site worldwide, following Ludwigshafen, Germany, and Antwerp, Belgium. The integrated value chain will connect upstream and downstream plants from basic chemicals to more consumer-oriented products and solutions, for things like consumer goods or transportation.
The site will be operated under the sole responsibility of BASF. BASF signed the first Memorandum of Understanding for the Verbund site with the Guangdong Provincial Government in Berlin in July 2018. This was followed in January 2019 by a Framework Agreement setting out further details of the plan.
Dr. Stephan Kothrade, president of Functions for Asia Pacific as well as president and chairman of BASF’s Greater China operation, stated: “Less than a year after we signed the first MoU, we are delighted to announce the first plants to be established at our smart Verbund site in Zhanjiang.” He added: “The project is moving forward swiftly and customers in southern China will soon benefit from these innovative products to meet their immediate needs.”
The company is planning to implement a comprehensive smart manufacturing concept at the integrated chemical production or Verbund facility, which will include automated packaging, high-tech control systems, and automated guided vehicles. BASF has set up a new wholly-owned subsidiary – BASF Integrated Site (Guangdong) Co. Ltd, also known as BIG – to provide general facilities and run the site.
In all BASF has invested some $10 billion in Zhanjiang. The plan is for the new engineering plastics compounding plant to supply an additional capacity of 60,000 metric tons per year of these compounds by 2022. This will bring the total BASF capacity of these products in Asia Pacific to 290,000 metric tons per year.
Raimar Jahn, President of BASF’s Performance Materials division, commented: “We want to improve our support for customers in the southern China market and around the world. We will do this by establishing the new plants close to growing customer industries, and through improvements in efficiency realized from our smart manufacturing approach. This will increase our speed of innovation and the efficiency of our services.” He specifically picked out electric and electronics companies and automotive manufacturers that are looking to address trends such as the electrification of cars and miniaturization of electronic devices.
The TPU market is also growing, partly due to increasing regulatory requirements and growing customer demands for more automation and more sustainable solutions. Consequently BASF is hoping to address this demand with safety-enhanced cables and wires for automation and automotive, as well as lightweight materials for consumer goods. Its strategy is to increase its investment in emerging markets to address local requirements while continuing to invest in developed economies.
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