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Kraton's CEO Talks Expansion in Asia, Innovation
By Amanda McCormack - Plastics News Europe

DUESSELDORF, Germany—Kevin Fogarty, CEO of Kraton Corporation, is excited to talk about the company’s recent developments.

Kraton, which produces styrenic block copolymers, specialty polymers and high-value performance products derived from pine wood pulping byproducts, is debuting its new branding at K 2016, which incorporates its unification with Arizona Chemical Holdings, its recent acquisition.

Kraton’s purchase this year of Arizona Chemical, which produces pine-based chemicals, doubled the size of the company, so as Fogarty said: “The company now has a polymer division and a chemical division, and what is really unique is that the customers we serve through both divisions are quite common whether it is adhesives, paving and construction industry, lubricant additives or oil-field chemicals there is a lot of commonality in the customers, which makes it a very complementary addition.”
Fogarty highlighted the importance of innovation.

“The focus at the K show are some of our technical developments in both medical and automotive and we have samples so the customers can come see the materials. We measure our progress on innovation literally monthly to make sure we are shifting the mix of the portfolio to more innovative based sales, but the reality is there is a certain time period for customers to embrace, adopt and ultimately use these new materials in their market place, so shows like these accelerate some of these efforts.

“It’s a special time for us as we are soon starting up our brand new state of the art hydrogenated styrenic block copolymer (HSBC) plant in Taiwan. We are in start-up phase now and in 2017 for a lot of these innovations, this plant is designed to produce the low molecular weight family of products to serve those innovations.” Fogarty said the new plant is in its commissioning phase. The facility is in Formosa Petrochemical Corp.’s complex in Mailiao, Taiwan, “We are delighted to partner Formosa on this project because they have been an extremely confident partner on the engineering and construction phase," Fogarty said. "The access to the infrastructure is something we couldn’t replicate at all.”

Fogarty also said when speaking on staffing for Kraton that, “There is no question that we will add people, particularly in one element of the acquired business that we think was understaffed, to reflect the growth potential in the business. We took one of our legacy Kraton business leaders and moved him over to run this business for us, and he is in the process of building that capability.”

Looking at business growth, Fogarty pointed out that the growth of the company’s latex business had been particularly good.

Although minor 10 years ago, the average growth rate of that business is now 10 percent annually, making it the company’s fastest growing segment. It now accounts for 7 to 8 percent of the business (when including the acquisition of Arizona). He revealed new technology is being created in Brazil where, next year, the company will be able to make the precursor to the latex on site, which will allow it to grow even faster by providing larger capacity.

Kraton has recently developed its high-melt flow family of hydrogenated styrenic block polymer materials, where the high melt-flow means the material can be injection molded for the first time. This, Fogarty points out, coincides nicely with the new Taiwan plant that is able to produce this low molecular weight material.
“The most beneficial way we can grow is by creating new markets for our products that don’t exist today, so we continue to have that absolutely commitment to innovation," Fogarty said. "We probably spend as much on R&D as potentially the entire industry combined. It’s something we believe is vital for the business, and we will continue to do that.”










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