Dubai-based processor sees future tied to value-added goods

Automation is proving the key to this Middle Eastern blowmolder as costs continue to rise and the operation seeks to remain competitive.

Costs are a major issue even when the processor is close to the resin source, says Mohammad A. Nofal, general manager of Duplas Al Sharq (Dubai, U.A.E.). His operation, which extrusion blowmolds polycarbonate water bottles as well as high-density polyethylene (HDPE) containers for lubricants ranging from 250 ml to 5 gal., has seen a roller coaster ride of resin prices that make long-term planning chaotic.

In January 2006 Duplas paid about $1000/tonne for HDPE and in September the same year the price had shot up to $1450/tonne. “In January this year we paid $1250/tonne and in May we expect to pay $1400/tonne,” Nofal said during a meeting in April. “These are non-calculable costs that are difficult-to-impossible to pass on to our customers. What we need is price stability over a long term.” Those customers include household cleaning products supplier Reckitt Benckiser Arabia; brandowners in the personal care, dairy, edible oil, and juice markets; and the processor is in discussion to supply Abu Dhabi-based oil producer ADNOC.

The 70-employee operation has a capacity of 30 million bottles/yr and just invested in new equipment to produce 4-degree-angle bottle necks.

To counter rambunctious resin pricing, Duplas relies heavily on a high degree of automation. The processing operation that started in 2002 is a joint venture owned 49% by Ali Al-Shehri, a Saudi partner, and the rest controlled by Emirates Investment and Development Co., a local holding that owns 15 other diversified operations. So far, Duplas is the only plastics processor in the group.

Duplas boasts a machine park of nine Magic (Monza, Italy) extrusion blowmolding units, one ASB Nissei (Nagano-ken, Japan) injection blowmolding machine for PET bottles, and two Engel (Schwertberg, Austria) injection molding machines for caps and closures production. All units are equipped with Rapid (Bredaryd, Sweden) recycling granulators to automatically re-feed all production waste back into the processing stream, an important point in cutting resin costs, says Nofal. Duplas also has eight-color UV printing and inline labeling equipment.

But Nofal points to the company’s investment in gravimetric dosing units as responsible for achieving substantial cost savings. The six Maguire (Tamworth, England) units are used to dose color masterbatch sourced from Astra Polymers (Alkhobar, Saudi Arabia) and local supplier Ener Plastics.

From the start Duplas avoided manually mixing and feeding masterbatches, which would have resulted in poor dispersion and a tendency to over-color to compensate for variation, he says. Gravimetric dosing allows precise use of colorants and therefore cost savings, as well as the ability to reallocate manpower to more productive work.

Because of limited storage, the company demands JIT deliveries from its vendors to limit masterbatch stocks. The entire plant is networked with a Navision ERP system so that at any one time Nofal can check, from his PC, each machine’s output, resin and additives availability, sales, costs, and the status of maintenance operations. The plant also is air conditioned to prevent condensation on its blow molds.

Today export plays only a small role in the processor’s output. “Demand here in the U.A.E. is growing so fast that it is taking the majority of our output,” says Nofal. Nevertheless, the company will make a decision about expanding output later this year. It is also thinking about entering another sector that is booming in Dubai—the extruded plastics profiles and siding market for the building and construction industry.

“We’re only considering value-added products in this market that don’t compete strictly on price, like existing local producers turn out,” Nofal says. “We’re looking for North American or European partners in this area who see opportunities offered in the region’s building boom.”