What has been at the core of Braskem’s global strategy over the last couple of years?

Braskem has been working on enhancing its competitiveness and increasing its diversity in terms of feedstock and geography. Today, approximately 50% of the company’s turnover comes from operations outside of Brazil. We are not reducing our footprint in Brazil, but rather diversifying and incrementing our activities in other regions. Brazil and South America are still our number one target for our Brazilian assets. Additionally, we are also working on improving our processes, incorporating digital initiatives, strengthening our compliance and implementing programs in accordance with our Circular Economy Positioning.   

Which geographical regions have been driving growth for Braskem?

The main region responsible for company growth over the last few years has been North America. Since Braskem acquired its first assets in the United States, we have been increasing the capacity of these assets. We have also started a greenfield cracker and three PE plants in Mexico, with an additional 1.05 million mt of PE. We are also in the process of building a new line in Texas to increase production capabilities. Braskem’s PP plant project in the Houston area is on schedule in terms of both budget and for time. The expectation is to have the plant online within the first half of 2020.

Braskem has also acquired assets in Germany, which has significantly boosted commercial operations in Europe. The company is now a local partner for global and local customers in Europe.

Considering future expansions, Brazil has a promising potential in its feedstock position in terms of pre-salt basin development. Brazil remains our strongest footprint, and a new economic growth cycle in the domestic market will demand investments over the next decade.

Braskem lowered the domestic prices for polyethylene in March 2019 due to currency devaluation. Was this a result of lower U.S. import prices? 

Market behavior in Brazil depends upon the trends of international markets. If international prices increase, Brazil’s domestic prices increase. If international prices decrease, the same happen in the local market. Currency also plays a role, as we invoice customers in Reais. There has been a significant amount of volatility in the Brazilian markets over the last 12 months. Considering the difficulties in the local market, sometimes we supported our customers waiting a few weeks to follow international prices upward pressure.

Currently there is a surplus of capacity with new plants coming on stream in the United States, and we have prepared ourselves to face this challenge. Industries and prices are cyclical, and we knew that there was going to be an increase in capacity. Part of this additional capacity has been accommodated by market growth, and we expect that by the second half of 2020, additional volumes will align once again with market growth. Braskem will continue to follow trends from the international market when evaluating domestic prices in the region.  

Is Latin America still a long way off from competing with the United States in producing feedstock?

In the short to medium term, there will be feedstock available in South America, both in Brazil and Argentina, for instance. In Brazil there has been a lot going on in terms of pre-salt oil production with the result being a significant amount of associated gas. We are monitoring investments that are being done and have been talking to potential partners, which could make the production of additional feedstock a reality. The monitoring and discussions are not only to develop existing assets, but also to invest in new ones. Braskem is interested in any potential source of competitive feedstock in South America and is actively monitoring several opportunities.

There are of course boundaries to investments, and it would be very hard to make investments 100% for the regional market. We will also have to be competitive for exports, but I think once the infrastructure investments are made we will be able to have new capacities coming on stream.

Can you provide details of the renewable bio-based EVA resin launched by Braskem in August 2018? 

In line with Braskem’s strategy to strengthen renewable chemicals, the company launched a resin made from ethanol sugarcane. Through innovation, we aim to expand the company's I'm green™ portfolio, which is already globally recognized for its green polyethylene, the world's first biopolymer to be produced on an industrial scale. With the new bio-based EVA resin (ethylene vinyl acetate copolymer) product, Braskem is demonstrating its leadership in sustainable manufacturing. The product is suitable for applications in industries such as footwear, automotive, transportation and flexible packaging.

Which other sustainable initiative is a current focus for Braskem? 

For the last couple of years, Braskem has also been working on enhancing the recyclability and efficiency of plastics. We have already resins in our portfolio that bring more efficiency to our clients by reducing the resources used, and we also have resins with recycled materials content. In addition, we are working on technologies that will improve the mechanical properties of the recycled resins in order to have goods that can be produced with a higher content of recycled plastics, as well as removing smell issues on recycled products and improving other properties of post consumption plastic.

In June 2018, Braskem launched a product that is a resin when recycled but does not lose its mechanical properties as a typical resin does. By improving the potential quality of the recycled resin, products can be produced with a higher content of recycled material. With regard to sustainability, Braskem’s three core priorities are plastic waste, water and climate change. Our purpose is to create sustainable solutions with plastics and chemicals  not only for our customers but also in a way that could make peoples’ lives better.

Besides initiatives in recycled and renewable resins, Braskem continuously invests to enhance its portfolio, with new products that allow eco-efficiency through energy savings, productivity gains and downgauging. These products are presented to the market under the Maxio^TM seal, which indicates the benefits for converters during the plastics transformation process.

Considering our position on Circular Economy, announced in October of 2018, we are also developing initiatives to engage the plastic chain, including the consumer, to be part of this transformation. The partnership with the Eagles in the United States to collect the recycled waste during the events in their stadium and to transform it into new products is an example. In Brazil we have an itinerant recycling project and invest in a Sustainable Education Program – EDUKATU – to engage, educate and share knowledge with consumers, as well as others including our clients and representative entities.

What are the key objectives for Braskem moving forward?

Braskem aims to continue to reinforce the diversity and flexibility that we have in terms of feedstock. We also have the objective to reinforce our geographical diversity by increasing our participation in other regions. We will remain focused on innovation, productivity and sustainability moving forward. To reach those targets, we have to invest in our people. As they grow and are successful, Braskem also grows. We are living in a world where we have to give our teams voice for them to make their ideas happen.