Cincinnati, OH—With current amorphous polyethylene terephthalate (APET) sheet capacity of 30,000 tonnes/yr, Octal Holding & Co. already is no small fry, but the Salalah, Oman-based processor announced during the SPE thermoforming conference in Cincinnati (Sept. 16-18) that it intends to become global APET sheet leader by May 2008. By then, a new $300 million PET resin supply/APET sheet-extrusion complex will be online, giving the processor an additional 300,000 tonnes/yr of APET sheet capacity.
Octal is located near Salalah Port in Oman, and claims that its deliveries from there can reach almost any port within 12-18 days. The processor has distribution, sales, and customer-service operations in the U.S., Europe, and Asia. The firm started operations in late 2006 with 20,000 tonnes/yr of APET sheet capacity and added an additional 10,000-tonnes/yr capacity this month. Assuming competing APET sheet extruders do not increase their capacity by a significant amount in the meantime, Octal says its May 2008 expansion will make it five times larger than the next largest merchant producer of APET sheet as well as the largest PET supplier in the Gulf region, with its capacity representing nearly 20% of the total industry output of APET sheet.
“Our entire process—from raw materials to finished APET sheet rolls–has been designed with the thermoformer in mind,” said Joe Barenberg, the firm’s COO, based in its Dallas, TX global sales center, in a statement. “Our strategy is to rationalize the production process, provide cost-efficiencies for thermoformers and packagers, and a sheet that delivers the most aesthetically appealing package possible. Our approach addresses the longstanding deficiencies that have hampered the large-scale expansion of APET as a packaging substrate.” Barenberg added that by mid-2008, Octal will have annual sales of $500 million as a base from which to double capacity within 20 months.
Speaking with MPW at the SPE thermoforming conference, Barenberg added that the private equity group that formed Octal investigated APET and decided it “stood out” as an excellent opportunity for growth. Two private equity firms in the U.S. invested in Octal: Chemlink Capital and Pound Capital. Octal also is funded by several smaller Oman-based investors but the majority of the investment comes from Chemlink and Pound. “We feel that [APET] is a naturally constrained market and risk of supply is a serious consideration for APET users,” Barenberg said. “Octal brings cost effectiveness, excellent gage control of ±1% or less, and a consistently quality product.” Octal''s material will be featured at the K show next month, running in thermoforming machines at the booths of both GN Machinery and Irwin.
Much as PET has replaced glass, metals, and increasingly other plastics in beverage packaging applications, so APET sheet is gaining ground for thermoforming of food and consumer goods packaging, often pushing PVC, PP, or polystyrene out of its way. According to Octal, worldwide demand for APET reached approximately $2.25 billion in 2006.
According to a new report on the APET sheet market in Asia from PCI PET Ltd. (Derby, England), APET sheet is now one of the largest and fastest growing segments of the entire global PET industry, with demand in Asia rising at an estimated 15%/yr. According to PCI, the current market size, in terms of sheet produced, is now some 650,000 tonnes, or 18% of the regional total.—[email protected]; [email protected]