Foreign chemical players boosting China operations

Major multinational chemical players are boosting their investment in China to seize opportunities emerging in the world's largest chemical products market, according to senior industry executives.

German specialty chemicals company Lanxess opened its Asia-Pacific application development center (AADC) in Shanghai Chemical Industry Park (SCIP) on Friday. The 3,600-square-meter center with 2,700 sq m of usable area is the first project to enter operations in SCIP's new Shanghai International Chemical New Materials Innovation Center (InnoGreen), and it is expected to substantially improve the company's local innovation capabilities.

"The AADC will enhance our local innovation and strengthen our confidence in the Chinese market, and ultimately serve our customers in the entire Asia-Pacific region," said Ming Cheng Chien, president of Lanxess Asia-Pacific region.

Matthias Zachert, chairman of the board of management of Lanxess AG, called the event an important milestone in the company's history in China.

"Our operations here are central to our global strategy, and we are grateful for the long-term partnerships we have forged in this country. China is a nation of opportunity, and we are always seeking new ways to support and participate in its growth and prosperity," Zachert said.

Anno Borkowsky, board member of Lanxess, said the center was built to strengthen the company's ability to address several strategically vital markets.

"With the AADC, Lanxess is taking another vital step toward being able to benefit from the growth potential in the world's largest chemical market," Borkowsky said.

Initially, the AADC will combine research activities of the business units polymer additives, lubricant additives and urethane systems.

"Today is only the beginning. We will consistently invest into China and the center. There is no limit to our further development in China,"Chien said.

According to Chien, under China's dual-circulation economic development pattern, domestic and foreign markets can complement each other, so Lanxess will form its own supply chain in China.

"As a multinational corporation, we will definitely tap into China's strategy and development," he added.

China has become the world's largest chemical market, making up 40 percent of global chemical sales, and the figure is expected to approach 50 percent by 2030. Market prospects are attracting global chemical companies to continue investing in the rapidly growing market.

After operating for 25 years in China, US-based chemical products manufacturer Huntsman Corp has developed China into its second largest market worldwide.

"In the past 25 years, Huntsman has completely integrated into the China market via local production, local research and development, local supply and local sales. We are providing localized, green and innovative polyurethane solutions for industry, transportation, construction and energy sectors and promoting the development of sustainability in China," said Pan Lyumin, president of Huntsman Corp's polyurethane business in the Asia-Pacific.

The firm looks to further increase its localization under China's dual-circulation economic development pattern, and complete a sustainable and green transition as well as help promote the nation's commitment to achieving carbon neutrality, Pan said.

Also, on Friday, Invista Nylon Chemicals (China) Co announced plans to establish its new Asia innovation center in Shanghai at SCIP.

The project has an investment of more than 95 million yuan ($15 million), which is the company's first research and development center for specialized nylon development in Asia. It is regarded as the company's next milestone in growing its specialized nylon value chain in China to allow it to better meet evolving customer demand across the region.

"The China market plays an increasingly important role in Invista's global business, and the plan to establish the Asia innovation center in Shanghai is a clear example of our commitment to further meeting strong local and regional demand for high-quality nylon products as China is also expected to become the world's largest nylon consumer," said Pete Brown, Invista's executive vice-president of nylon polymer.

The lab is projected to become fully operational by the end of 2021, among SCIP's first batch of projects at InnoGreen.

The 2,500-square-meter lab will be equipped with state-of-the-art polymer research and development equipment. It will also include polymer compounding extrusion and injection molding capability, and analytical and mechanical test equipment for polymer resins.

Angela Dou, director of intermediates with Invista in Asia, expects the center to help the company quickly respond to local customer needs and facilitate downstream application upgrades.

The center aims to focus on application needs in engineering polymers for key industries including automobiles and electronics. Located near Invista's integrated nylon 6,6 facility in SCIP, the lab will promote the company's comprehensive nylon 6,6 capabilities in China, including R&D, production, sales and technical services, to provide customers with superior quality nylon products and solutions.