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August 18, 2006
Press Conference |
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Press Conference
Shanghai MDI/TDI Project Opening Ceremony
Caojing, China |
BASF Polyurethanes in China –
Focusing on long-term profitable growth
Dr. John Feldmann
Member of the Board of Executive Directors of
BASF Aktiengesellschaft
The spoken word applies!
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Ladies and gentlemen,
About two years ago we met the majority of you here at the Shanghai Chemical Industry Park for the groundbreaking ceremony of our world-scale integrated isocyanates complex. Back then we were in a pitched tent on a bare piece of land. Now on that same piece of land is a modern, world-scale chemical complex already producing the building blocks of polyurethanes – MDI and TDI.
I am proud to say that we have delivered on our promise of starting up commercial operations by mid-2006 – a tremendous achievement by our employees, our partners and our suppliers.
In the nineties, we developed a strategy to tap into the immense potential of the Chinese market, and today we are opening together with partners this integrated complex, with an annual capacity of 240,000 metric tons of crude MDI (diphenylmethane diisocyanate) as well as 160,000 metric tons of TDI (toluene diisocyanate). These new capacities will serve the rapidly growing market for polyurethanes in China. In the period up to 2015, this market is expected to grow at about 10 percent per year, becoming the world’s largest market for polyurethanes.
Thus our participation in this world-scale project plays a key role in our strategy to better serve our Chinese customers from local production. Our other main production base for polyurethanes in the booming Asian region is located in Yeosu, South Korea. This means BASF has already installed more than half of its TDI capacity in Asia, and about 30 percent of its MDI capacity in the region.
This consequent implementation of our polyurethane strategy fits ideally with our ambitious group targets for Asia and for China in particular: We aim to achieve 20 percent of our global sales and earnings in our chemical activities in Asia by 2010, with China contributing one half of our Asian business. In addition, 70 pct of these sales in Asia will come from local production.
Helping our customers to be more successful is a key strategic guideline at BASF, and as one of the leading global suppliers of polyurethanes, we fulfill our claim not only with polyurethane basic products but also with polyurethane systems, and special elastomers. That is why polyurethanes specialties tailored to the requirements of Chinese customers are to be produced at our site in Pudong, not far from here, from early 2007 onward.
This new site will not only use the cost advantages provided by the closeness of the MDI/TDI complex in Caojing, but will also exploit the synergies of our global network of around 30 system houses and more than 3,500 customized polyurethane solutions.
Ladies and gentlemen,
Complemented by the respective strengths from each of our partners, we are convinced that the complex in Caojing will prove to be a cornerstone of our long-term profitable growth in China, as well as in Asia. Our cooperation with our partners has proven to be so successful that we took the decision earlier this year to consider the construction of a 400,000 metric ton crude MDI plant in China after 2010.
These plans as well as our Caojing MDI/TDI complex underline our commitment to the development of the Chinese chemical market, the Chinese economy and hence the prosperity of Chinese society.
Thank you.
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