Nigeria is our first move into the African continent and we see sound potential for growing our business as the local economy grows.
With Fibre2Fashion Correspondent Cindrella Thawani on Face2Face interview, Aloke Lohia speaks about their expansion plans and various technicalities of polyester.
Synopsis:
IVL has operations in PTA, PET and Polyester with 24 plants and over 6,646 employees spread across North America, Europe and Asia.
Aloke Lohia is the Group CEO of Indorama Ventures Public Company Limited (IVL). He has lived in Thailand for over 20 years during this time, and has built IVL as the world’s leading global polyester value chain company.
In February 2010, he delisted Indorama Polymers, which he started in 1995, besides, listed its larger parent company Indorama Ventures successfully on the stock exchange of Thailand as well as it is part of the FTSE SET large cap index.
Mr. Lohia completed his education from Delhi University and is married to Suchitra who runs the packaging arm of IVL.
Excerpts:
What makes polyester live in demand? Which significant things are striving to it?
Polyester fibre is always in demand as it is the most competitive material for the textile industry manufacturing not only apparel, but also home furnishings and a myriad other applications in industries such as hygiene, automotive etc.
Moreover, it is the most affordable form of packaging and the material of choice for various packaging applications such as beverages, water and a number of food products.
PET has steadily been taking away market share away from glass and aluminium as it is not only lower in cost and but is also a more sustainable alternate due to much lower consumption of energy and water in its manufacturing process as well as easy recyclability.
Cotton is an ever ‘green’ fibre. How can we tag, polyester as an eco-friendly fibre? What are the possibilities?
Being a natural fibre, cotton is beholden to the elements and the desire of farmers to plant cash crops that provide them with a better income.
As a result of the inter-crop competition, it has become difficult to expand cotton acreage and production to meet growing demand.
Polyester on the other hand requires little land and not much water or energy in the production process and therefore the filling of the demand gap is possible.
Importantly, polyester is easy to recycle and many sportswear manufactures and customers alike already understand the unique properties that make polyester the material of choice for sportswear due to its ability to disperse perspiration quickly and efficiently coupled with anti-microbial effects.
Many brand owners have moved further into the use of recycled Polyester to maintain their sustainability goals and take advantage of the positive applications of the fibre.
Is there any change in the quality of recycled polyester fibre as compared to the original fibre?
Absolutely not. The chemical composition of recycled polyester is identical to that of virgin material. Recycled polyester must feel and act like its virgin alternative otherwise it would not be well accepted by the consumer.
Recycled polyester fibres are re-engineered to meet the exacting demands of performance and compliance similar to a virgin product.
These properties are further complimented with the additional benefit of sustainable credits as a contribution to environmental management.
As with other fibres, PET materials, such as those produced at our Wellman International plant in Ireland, must deliver the required textile or engineering properties of their construction, the softness and comfort of a textile material or the strength and resilience of an engineered component, without these features the material would not meet the expectations of the consumer.
To exemplify its commitment to this recycling ethos, Indorama Ventures has launched the ECORAMA brand for its recycled polyester fibres and yarns products because we understand this is what the consumer is looking for and appreciates as long as the feeling is exactly the same as the virgin material.
Please tell us about Indorama Venture’s journey towards the innovation/state-of-the-art in the textile industry. Also enlighten us with your anew further moves.
We at Indorama Ventures are very excited about our move towards product development and innovation in the polyester chain.
Our rationale is simple – we believe that innovation will not only provide us with an ability to enhance our margins through higher value addition but also enhance our ability to serve customers better and expand the market through new application development.
With the recent acquisition of US-based FiberVisions, we saw the possibility to enhance our portfolio offering to our customers with Polypropylene Fibres.
The acquisition of FiberVisions also significantly enhances Indorama Ventures’ position in the specialty fibres business and other growing fibre applications.
Indorama Ventures is investing further into its Thai facilities market with a bicomponent fibres project for hygiene applications. The company is increasing its focus in the non-woven materials market.
Moreover, IVL will also invest in another strategic project to make high quality specialized yarns, at its Indorama Ventures Indonesia (IVI) plant (formerly SK Keris) in Tangerang, Indonesia.
As a result, we are developing new generation products to enhance our competitive edge.
What kind of challenges do you foresee in future as regard to cotton and polyester production?
Polyester offers a challenge to all natural fibres due to its low cost and comparable utility. However, we have identified the need to implement further construction of plants for recycling as this is what the consumer, and our major customers, desire.
We recently acquired Wellman International, Europe’s largest post-consumer plastic recycler and we will have the advantage of an ability to produce both bottle grade pellets and fibre from this waste material.
As the world’s largest polyester value chain producer, we obviously wish to lead the way in recycling and responsible manufacturing.
Going forward, we do not see any credible threat of reverse substitution from materials such as cotton etc., due to their severe limitations in being able to grow production in line with demand.
In which regions do you see the potential demand of PTA, PET, globally?
Its consumption is more in the developed markets such as N. America, Europe and Japan, but the developing world is fast catching up.
In the PET resins business we have seen that labour costs play an insignificant role in the total cost of ownership as compared to logitistics costs and trade barriers, therefore even production remains robust even in the developed world.
We follow a philosophy of being close to our customers and need to be in those areas of the emerging world where our customers are growing their business so as to serve them competitively and better.
This is the reason why we entered in China, Indonesia and even Nigeria.
Indonesia is particularly exciting for our fibre business as it enjoys lower energy and labour costs than many other Asian nations and has a large population with an attractive rate of economic growth, unlike PET the polyester fibres business is more sensitive to labour costs.
On the other side of the globe, we are finding our entry into Mexico rewarding, as it not only has a rapidly developing economy but offers us low cost entry into Latin American markets thanks to its numerous FTAs.
Nigeria is our first move into the African continent and we see sound potential for growing our business as the local economy grows.
For Indorama Ventures, the western markets of N. America and the European Union remain extremely important as they will continue to provide consistent demand and even growing demand for PET and its feedstock PTA as those markets are obviously accustomed to the product and view it as a part of their daily necessities.
Which modern applications are buoyant on the prospects of the polyester business? Please explain.
Packaging is an area where PET has proven particularly adept at taking market share away from competing materials such as glass aluminium as well as other plastics.
With new applications and materials being developed and commercialised by Indorama Ventures, we are able to increase the shelf life of fresh juices by slowing the ingress of oxygen and recently very successfully launched a grade of PET resin, which can be extrusion blow molded.
This is where a PET bottle can be blown with a handle built into the body of the bottle made of the same material
Do you think petroleum production can ever give threat to the fibre production, especially polyester in near future?
All polyester companies are a part of the crude oil downstream business and therefore we are as an industry inherently interested in whatever happens in oil and gas production.
However, we remain mindful of the need to mitigate downwards our consumption of carbon-based natural resources for energy and raw materials.
We therefore have implemented energy-saving methods across our business platform and lowered our reliance on carbon-based energy sources with the implementation of a solar power farm in Thailand last year and the reuse of our several raw materials in the manufacturing process.
Published on: 06/06/2012
DISCLAIMER: All views and opinions expressed in this column are solely of the interviewee, and they do not reflect in any way the opinion of Fibre2Fashion.com.
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