MOSCOW (MRC) -- Hyosung (Seoul, South Korea) says it will invest USD36 million to almost double existing production capacity at its spandex fiber plant in Santa Catarina, Brazil, reported Chemweek.
The 10,000-metric tons/year capacity expansion for the facility in southern Brazil will be completed by December 2021, raising the plant’s total capacity to 22,000 metric tons/year, it says. The capacity hike will help to meet a “rapid rise” in demand for the synthetic fiber in the Americas, it says.
“In the Brazilian market, the import tariff rate for spandex is as high as 18%, which is more than double the rate applied in other regions. Therefore, a local production base is essential for maintaining price competitiveness,” according to Hyosung. Brazil’s location is also advantageous for export to nearby countries, it says. The company first established a production base in Brazil in 2011 and currently holds a market share in Brazil of 65%.
“The unprecedented risk caused by Covid-19 has aggravated uncertainty and accelerated the speed of change,” says Hyosung chairman Cho Hyun-joon. “In times of change, we must turn crisis into opportunity by continuously investing in our future.”
Hyosung, the world’s leading producer of spandex, also says it decided in November to invest 60 billion South Korean won (USD55 million) to expand production capacity at its existing 25,000-metric tons/year spandex plant in Turkey to target the market in Europe. The expansion will be completed by the third quarter of 2021 and raised the plant’s capacity to 40,000 metric tons/year.
The company produces approximately 340,000 metric tons/year of spandex fiber, one third of current global demand.
As MRC wrote previously, following the start-up at the newly constructed PP plant in Vietnam on 12 February 2020, it was reported that Hyosung reached on-spec cargoes approximately in mid-February. The first prime grade parcels were homo-PP yarn grade F501N with a melt index of 3.7.
This is the No. 1 PP unit that has an annual capacity of 300,000 tons/year, operating using external sources of propylene. The company is constructing the Phase II project at the same location, which houses a propane dehydrogenation (PDH) plant and No. 2 PP unit that could produce another 300,000 tons/year.
According to MRC"s ScanPlast report, PP shipments to the Russian market reached 978,870 tonnes in January-October 2020 (calculated using the formula: production minus exports plus imports minus producers' inventories as of 1 January, 2020). Supply of exclusively of PP random copolymer increased.
Hyosung Corporation is a Korean industrial conglomerate, founded in 1957. It operates in various fields, including the chemical industry, industrial machinery, IT, trade, and construction.