The new line is not aimed at commodity PET market

Italian PET resin and packaging firm M&G Group is to invest $70m (E58m) in a new production plant in South America.

The single reactor line will have a capacity of 450,000tpa and is scheduled to be onstream in 2006. The exact location will be confirmed before the end of the year. The PET plant will employ traditional technology, enhanced by two technology innovations; one in the melt line and one in the solid-state phase (SSP).

M&G’s Polymers Business Unit chief executive Marco Ghisolfi said: “I would like to stress that M&G’s new plant is not aimed at the commodity PET market. I remain convinced that the commodity PET market is over-supplied and in need of rationalization; a situation in which one would not expect to justify re-investment.

“I would be surprised if the recently announced fibre-to-PET conversions (which are very expensive, typically requiring more than twice the capital per unit of output compared to modern PET plants) could recover their investments.

“Our new South American plant is designed to satisfy a growing market for economically viable high performance PET. We predict that these emerging new applications, that are already fast growing, will reach a demand level that justifies the size of our new investment within the next two to three years”.