Interview with Maurizio Butti, President of Songwon International AG

"The client, in general, is becoming increasingly large, and therefore more comprehensive." That is why, for us it is difficult to talk of geographic markets. "When we negotiate with Basell or GE, for example, not we negotiated with them in a local but global way". Thus provided for the international market Maurizio Butti, President of Songwon International AG. The Korean company produces, since 1965, stabilizers for polymers, plasticizers and lubricants for PVC, and antioxidants, 52 per cent of its production, among others. With a workforce of 300 employees, it is present in China, Japan, Switzerland, United States, and turnover of 150 million dollars. The multinational has two plants in Korea and a third under construction, which will be ready by the end of March, and which will be devoted to the production of antioxidants.

This relationship will end for strategic reasons and not because we are not satisfied with the work of Clariant. The truth is that it was good for a while, but now the company needs to develop plans according to the needs of the market. It is very difficult to do this through a single retailer.

What we do in Europe is closer to the market directly, but we will also do this through distributors. Will therefore have, primarily, with three companies: Algol, to the North of Europe, Biesterfeld, for Central Europe, and the Italian company Eigenmann & Veronelli, to the South of Europe. We serve directly to large customers, and for the rest, we shall support these distributors.

For the moment we will maintain the same structure and will divide Spain into two segments of market. We will act as in the rest of Europe: we abasteceremos to large firms and for the rest, we will support Biesterfeld, covering the market of plastic and Eigenmann & Veronelli, through its joint venture in Spain, Ricardo Molina, S.A., specialist in the marketing of chemical products, from 1927.

Europe is very important for us because it is a great market, but it is not growing much. Only a 1 or 2 per cent a year. Most of the new capacity is going to other areas of lower costs as Middle East. It is very important for us to establish a strong presence in Europe, but the market is not going to grow too fast.

Well, it is changing geographically. Demand in the Middle, as I have already said, is being increasingly stronger, as well as other areas such as China, of course, but also other areas such as South America and Eastern Europe.

The situation in Europe is more or less the same as in Japan, where the market is not going to increase significantly. Another change we see is that the client, in general, is becoming increasingly large, and consequently, more global. That is why, for us it is difficult to talk of geographic markets. When we negotiate with Basell or GE, for example, not we negotiated with them in a local but global way.

Songwon is different from its competitors for the great commitment that shows with industry

Firstly, we have a great commitment to this market, in fact, we are of the few that we make significant investments. As an example, the construction of the new plant that I mentioned earlier. In addition, we have a very good competitive position because our production of antioxidants is part of a highly integrated, with all key intermediates business.Another of our strengths is that we offer a good product and current trend, which is not very common among the competition.
But basically, it differentiates us the great commitment that we are with the industry.

Songwon installed its first plant in Pusan, to the southeast of Korea of the South in 1965. A year later he started production of PVC stabilisers liquids. Currently, the company that "special attention to the r & d", said Butti, manufactures polymer, antioxidants, alquílico, cresol alquílico phenol stabilizers, plasticizers and lubricants for PVC, polyurethane, bifenol, polyester diol, coagulants, super absorbent polymers and intermediate products of Tin.

The production of antioxidants was born in 1985 and holds today, 52 percent of the production of Songwon.

The construction of new facilities is the first step, since we are going to produce 20,000 tonnes of antioxidants and the design of the new plant is ready to double the capacity. Therefore, this will happen as soon as the market conditions require it. For the time being, the market is well covered with this, but we are prepared to take the next step, which can take a few years, depending on, as I say, the development of the market.