(From the Special Report Rubber's Global Footprint: Focus on South Korea from the May 30, 2011, issue of Rubber & Plastics News)
SEOUL, South Korea—South Korea is a major performer on the world economic stage, and a number of its elastomer-related companies are noted actors.
One world player, and a company whose experience in many ways reflects South Korea's global business strategy, is Songwon Industrial Co. Ltd.
Songwon lays claim to being the second-largest supplier of phenolic and phosphate antioxidants in the world. It's a force in serving the polyurethanes and thermoplastic elastomer field, and is a specialty player to rubber processors.
“Our primary market is thermoplastics where we have focused on the polymer producers and compounders,” said Jim McGinley, Songwon executive vice president, business management.
“We are now also moving downstream with solutions tailored for specific applications where there is a need for improved long-term heat stability or improved UV protection,” the executive said.
Songwon is a major supplier of polymer stabilizers in the polyolefin, styrenics and PVC markets in South Korea. For the urethane and TPE markets, McGinley said the company provides its main antioxidants—Songnox 110 and 1076—for basic stabilization, as well as a variety of specialty antioxidants for specific performance requirements in specialty applications.
In serving the rubber sector both at home and abroad, the company isn't a big player. McGinley said, however, that Songwon is “working to expand our presence and our product offering” in the rubber segment.
Songwon, to provide products to the worldwide polymer markets, has been active in capacity expansions and joint ventures. The company is boosting its antioxidant capacity from 55,000 to 80,000 metric tons, which includes 10,000 metric tons via its Songwon HPL Additives (Pvt.) joint venture in India with HPL Additives Ltd.
“The additional capacity will support market growth and will be on stream in August 2011,” McGinley said.
The supplier decided to build a plant in Maeam, South Korea, to take advantage of economies of scale and “maintain a competitive edge on the world stage,” he said.
“Raw material costs are a major factor for Songwon and our customers, and because Songwon is very sensitive to the needs of its customers, this factor figured in our decision to make the investment in the Maeam facility, where we are fully back-integrated into isobutylene production.”
The project will help Songwon provide more Songnox 1076, as well as some specialty antioxidants, McGinley said. With the world's rubber and plastics markets expected to grow 4-5 percent a year, that means “a world scale antioxidant plant is required every two years to keep pace.”
“While the current projects will help in the short term, we are also working on longer-term solutions to keep up with the growing demand,” he said.
One of those current projects is Songwon Baifu Chemical Co. Ltd., a joint venture with Tangshan Baifu Chemical Co. Ltd. that will be fully incorporated by the middle of the year. It will produce thioester antioxidants, and be fully backward integrated, McGinley said. The business will supply Songnox DLTDP and Songnox DSTDP thioesters for the Chinese and global markets.
The firm also will open an analytical laboratory in Shanghai, China, by the end of the year.
Ulsan, South Korea-based Songwon has other properties in China, which has been and is expected to continue to be a growth market for the firm, McGinley said. It operates Songwon China Ltd. in Hong Kong, the investment arm of its entities in China, and in Shanghai, Songwon Shanghai Trading Ltd., the main operational company where sales and sourcing activities on behalf of the global Songwon group are conducted.
Chemservice Asia Co. Ltd. is another of its firms, providing regulatory advice and acting as an authority on REACH compliance in China.