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NPE2009: Notes from the bottom of the downturn

I am not an economist, but it seems to me to be a reasonable assertion that NPE 2009 took place at what will prove to be the trough of the economic downturn, a mere three months after the capital markets in the United States reached almost unthinkable lows that erased a decade of gains. The good thing about a trough is that there is only one way out, and that’s up. How we get there remains to be seen. But the most impressive thing to me was the resilience of people in the plastics industry during this time.

Michael Sepe

September 14, 2009

12 Min Read
NPE2009: Notes from the bottom of the downturn

All through the last quarter of 2008 and the first half of 2009, certainly the question was being asked, “What if they held an NPE and nobody came?” Well, they came. If you go only by the numbers, they were not pretty: 42,907 compared to 64,451 in 2006, a decline of 33%. (The S&P 500 was down 28% during the same interval, to put things in perspective.) Industry representatives quickly rushed in to fill the vacuum left by the collective gasp at such numbers by pointing out that there were more exhibitors this year. But that misses the point. The real revelation, repeated by every exhibitor I spoke with, was that while the number of people walking the floor was down, the quality of the attendees was up, way up. A much greater percentage of the attendees were there with specific plans and agendas and could make decisions on purchases and programs. There were fewer tourists, fewer sightseers, and fewer people walking around lugging laundry baskets filled with souvenirs. One company that I work with cited actual statistics: 26% of the leads obtained from the show had turned into serious opportunities or actual business as compared to 14% over the same period in 2006.

All of this raises interesting questions about the wisdom of those companies that passed on the opportunity to exhibit this year. There were some notable and troubling absences on the part of domestic suppliers that contrasted with the surge in the presence of companies who came from China despite the overblown concerns about H1N1 influenza. It is hard to comprehend the calculation that a small toolmaking firm from Shanghai will come halfway around the world with their owner as part of the booth crew and a major compounder less than 400 miles from Chicago will pass on the opportunity to talk to 42,000 industry people about their products. But as one journalist succinctly put it when speaking of one auxiliary equipment manufacturer, “Not only are they thrilled that they came, they are thrilled that their two largest competitors did not.”

The surge in the Chinese presence was noted by the industry press—197 firms this year compared to 115 in 2006 and 27 in 2003. Welcome to the global economy. The press was also quick to point out that the Chinese firms tend to occupy less square footage and have less flash associated with their exhibits. But in general, everyone cut back on the frills this year. This is not such a bad thing. Hopefully, the days of exhibits populated with models who introduce product lines with pitches full of double entendres are behind us. I can go to Vegas for that.

Going to NPE is always an exercise in déjà vu. The setting is so similar from one show to the next that I always have the feeling that I just left the previous show; that no time has passed even though the calendar has inexorably advanced three years and some of us bear visible signs of the interval. There are the familiar elements that lend credence to the stoppage of time; the interminable lines at the Starbucks kiosks, the indefatigable workers removing scuff marks from the floors with long-handled tennis balls, and the omnipresent distributors of the NPE daily news, looking this year like ushers at a Grateful Dead concert even though none of them was old enough to remember Jerry Garcia.

But there was also the brand new. For the first time, SPI shared the territory with SPE in a formal way. Antec was held just down the hall from the exhibits. And while it is difficult for an event that typically garners 3000-5000 attendees not to be overshadowed by one that attracts 10-20 times that number, it still provided some unique opportunities to access parts of the industry that often do not overlap within the same venue. In addition, the Moldmaking Expo Trade Show, a Time Compression Conference and Expo, a Coatings for Plastics Conference, and a conference focused on packaging applications all occupied space alongside the main event.

Every account of NPE is a personal one. You can’t see the whole show even in five days, and you could argue that you probably should not try. Even within the relatively focused world of plastics technology, we all have our specialties and interests and these will drive our decisions regarding who we visit and speak to. In addition, this was my 12th NPE. So some of the time is spent renewing old friendships and catching up with the people who are important to us and who, regrettably, we sometimes have not seen in three years. With that in mind, here is an overview of one person’s structured meanderings through the halls of McCormick Place.

Material observations
There were disappointing absences in the ranks of my favorite niche, the material suppliers and distributors. But at the same time there was the notable return of perhaps the most significant absence from the 2006 show, GE Plastics in its new incarnation as Sabic Innovative Plastics. While the name on the sign may have changed, the names on the products have not and this year’s exhibit confirmed the unmatched depth and application-focused nature of the product line. In addition, the change in ownership brings a new and unfamiliar juxtaposition of commodities with the traditional products from the engineering plastics realm. Polyolefins are suddenly part of the already formidable GE/Sabic market basket.

My discussions with people at the Sabic booth regarding the availability of their polypropylenes and polyethylenes indicate that the challenges of supply chain management place the time horizon at 12-18 months before these materials appear on North American shores. But it will be interesting to observe the impact that this will have on not only the market but also the technology of a domestic polyolefin market that can only be described as dysfunctional.

The best individual discussion on new materials technology had to be at Eastman. There I had the opportunity to speak at some length with Emmett Crawford, the creator of the chemistry that has spawned the Tritan copolyester product line. This product has received a lot of attention in the trade media, primarily because of its unrelenting focus on taking market share from polycarbonate in consumer markets where concerns over bisphenol A have recently surfaced. But often this type of coverage is more hype than substance and it misses the real significance of a new development.

I am not a big fan of presentations on materials that begin and end with a data sheet and a press release. So to be able to discuss real properties like glass transition temperature instead of imaginary ones like HDT, and to be able to delve into the implications of the new chemistry for long-term performance characteristics such as stress cracking resistance and physical aging was gratifying. To be able to do so with the chemist who was responsible for the research was a thrill that only a material nerd could understand. The bottom line is that this new technology is for real, it represents a significant extension of polyester properties into a temperature realm that was not previously available, and it will be a significant player in the transparent materials realm going forward.

If there was a technological theme to this year’s show, it was biopolymers. This is something that has been coming for a while, but it appeared to reach critical mass this year. This was exemplified by the presence of Jamplast. The company has been in existence since 1994, but this year it seems to have reached a new prominence in its role as a distributor for the major manufacturers of biologically derived polymers like Nature Works, Merquinsa, and Cereplast. In addition, Sabic, DuPont, and others were emphasizing their place in the newly embraced green initiative by highlighting the availability of material grades that represent postindustrial content, postconsumer content, and new materials produced from monomers derived from renewable resources.

For me this is a fascinating turn of events. In the late 1970s I worked with a government research group in Peoria, IL known at that time as the Northern Regional Research Laboratory (NRRL). This was the time of the first oil crisis and also my early days in the plastics industry. With real concerns about the sustainability (to use a current term) of the petroleum industry and the implications for polymer production, attention was being given to the feasibility of producing commercial polymers using chemicals derived from renewable resources.

The actual work never advanced beyond the small scale. However, it did demonstrate that a wide range of polymers could be produced from renewable products. At first the work was performed on edible materials such as corn and sorghum. However, the researchers at NRRL had already anticipated that diverting edible commodities to the production of energy and raw materials could increase food prices. Consequently, some of the research had already moved into using the inedible parts of plants or cultivating crops that produced inedible oils.

The technological feasibility of producing polymers such as polyethylene and nylon already had been demonstrated when the oil shortage eased in the early 1980s and funding for such research dried up. Now the commercial sector has brought things back at levels undreamed of 30 years ago. The challenge will be to provide information on these new materials in a timely manner so that potential users can make informed decisions about where they can fit.

Beyond the resin
One of the most interesting booths at NPE for me was the Beaumont Technologies Inc. (BTI) display. Since articulating the foundations for understanding shear-induced flow imbalances in the mid- to late-1990s, John Beaumont and his team have steadily expanded the applications of their MeltFlipper, a tooling insert designed to turn the stratified layers of hot and cold material in the flow front in order to achieve a more homogeneous melt in the cavity and reduce stresses due to differential cooling. The last three years have brought new innovations in the technology such as inserts that can be adjusted in the mold, as well as new ways of offering the technology to end users.

While the initial applications for the MeltFlipper involved multiple-cavity molds, one application that the company’s Dave Hoffman showed me involved a simple single-cavity edge-gated disk molded with and without an adjustable MeltFlipper. The part he had on hand was produced from a glass-filled polycarbonate, a material that shows significant cosmetic differences when the flow front is altered. What struck me was the fact that when the two parts were put on a flat surface, the part molded with the MeltFlipper was visibly flatter than the part molded conventionally. And this was in an amorphous material where warpage is not typically considered to be an issue. One can only imagine the differences that might be seen in a glass-fiber-reinforced nylon or acetal.

Another exciting development within the BTI camp is that flow modeling is beginning to catch up with the realities of shear-induced flow imbalances. One of the big problems has been the lack of algorithms within the standard flow modeling software packages that captured the consequences of shear-induced effects. This made them difficult to demonstrate until the mold was already built. It appears that BTI is on the road to integrating this effect into flow simulation modeling.

Innovations can come from unexpected places. You would not typically expect to find anything particularly new and revolutionary in the area of material granulating. And yet, the folks at Harmo showed a new approach to regrind management that they call the Gran-Cutter. The video demonstrations and the quality of the regrind that was available for a hands-on examination were impressive. Using an oscillating cutter as opposed to rotating knives, the Gran-Cutter appears to eliminate fines, handles very hard and highly filled materials as well as soft elastomers with equally good results, and produces a more uniform particle size. All of these items are of great importance to the maintenance of consistent drying, feeding, and melting of materials when regrind is being used. Given the number of molders that continue to throw away scrap rather than reclaim and remold it, this type of innovation could be every bit as significant as the PIR and PCR initiatives.

Not all new ideas turn out to be as spectacular as they first sound. Mettler-Toledo, manufacturer of thermal analysis equipment, precision balances, and Karl Fischer-based moisture analysis systems, displayed a moisture analyzer that it advertised as halogen based. It sounds like a new approach to moisture analysis and the use of the word halogen implied, at least to me, that it was based on a chemical method that was potentially simpler to use than Karl Fischer. This would be a significant breakthrough, because with the exception of the Vapor Pro from Arizona Instruments, the only alternative to Karl Fischer moisture analysis in the plastics industry has been the use of loss-in-weight systems. These cannot guarantee that only moisture is being measured. Unfortunately, the new-sounding technology was not that new after all. The word halogen refers not to a new chemical method but to the type of heat source used in yet another incarnation of the flawed loss-in-weight systems. Fortunately, Mettler-Toledo does sell the Karl Fischer systems that should be the standard in the industry.

It was just 21 months ago that the industry came out of the K 2007 show with reports that, in retrospect, can only be characterized as irrational exuberance. As the wildly optimistic prognostications were covering the pages of the trade journals, the first chinks in the armor of the world economy were beginning to appear. A year later pronouncements were being made about the second Great Depression. NPE this year came far enough down the timeline to give us some perspective on both of those extreme views and showed us that they were both unrealistic. They also demonstrated that those who predict the future are good for entertainment value but not much else.

NPE demonstrated that there is life after calamity. And going forward, we should be able to expect an industry populated by clearer thinking, better practices, and less fluff. Opportunities are everywhere, and the new sobriety brought about by recent events will hopefully serve us well in identifying them. As for that second Great Depression, it may be worth noting that those who collectively have achieved the greatest level of prosperity in their lives since the mid-19th century were born in 1935. —Michael Sepe

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