Could you familiarize our audience with Covestro’s footprint and capabilities in Thailand?

Covestro Thailand has three main locations: our ASEAN headquarters office in Bangkok, a technical lab for application development in Bangpoo, and a world-scale production plant at the Map Ta Phut Industrial Estate, in Rayong, where we produce polycarbonates (PC), specialty films and elastomers. The Map Ta Phut facility, with a yearly name plate capacity of more than 300,000 tons of (compounded) polycarbonates, is one of the most modern PC plants in the world, producing very high-quality polycarbonates (e.g. optical grades).

Globally, Covestro has 50 production sites and 10 innovation hubs.

What have been the most recent investments at the Map Ta Phut site, and what makes Thailand a good investment location for Covestro?

The last investment that we completed in 2022 was in the first Naphthalene-Diisocyanate (NDI) plant outside of Europe. Currently, we are making an investment to increase capacity in our engineering plastics, including the capability of recycling of polycarbonate. And thirdly, at the beginning of 2023, we announced another investment to expand our specialty films production – once complete, this will be the most advanced specialty films facility of Covestro in Asia.

Thailand has been sitting in the sweet spot over the past few years, in between the energy crisis and geopolitical issues in Europe, and strict COVID measures in China. Different governments and multinationals are looking to diversify their operations within APAC, a strategy that has become known as “China Plus One.” Since Covestro has a well-established footprint in Thailand, for us it was a natural choice to continue investments here, leveraging on our cost competitiveness, expertise, high-level of infrastructure, and good cooperation with Thai authorities.

Could you comment on some of the challenges you face as a producer in Thailand?

Our vision is to become fully circular and climate-neutral by 2035 and to reduce our GHG emissions by 60% by 2030. Unfortunately, Thailand is still on its way on providing infrastructure to use green energy or the frameworks to buy carbon credits, as other countries do. This can render us uncompetitive unless we can switch to greener energy sources, in line with our customers’ climate goals. The energy origin and use are decisive criteria for future investments in the commodities space.

Can you explain to our audience some of the impediments to recycling and what technologies is Covestro using?

As a basic concept, some plastics are recyclable, while others are not - or not easily. Generally, a product that contains multiple types of plastics makes it very difficult to recycle. For instance, sneakers can contain up to 20 materials, so pulling this apart is no easy task. Plastic manufacturers face a dilemma: to design for recyclability, by using mono-materials, or to design for performance, which is normally associated with combining different materials? The other broad categorization is between thermoplastics (which can be remelted and therefore reused more easily), and thermosetting plastics (which are harder and do not melt, but catch fire under heat, and therefore cannot be recycled that easily). Polycarbonates are a thermoplastic and good for recycling, since they can be thermoformed severally without losing their desirable properties. Covestro is working with third-party companies, that take care of the collection and sorting of the plastics, and then we take them through a process of mechanical recycling. For thermosetting plastics like our TDI mattresses, we are developing chemical processes to break down the polymer chain and reform the molecules into new plastics. We collaborate with some leading companies in the furniture industry for the collection of mattresses. Finally, the third process available is pyrolysis, through which materials are decomposed at elevated temperatures to create an intermediate liquid (pyrolysis oil).

Finally, 11 of Covestro’s sites at ISCC-certified, which shows we can supply our customers with products from non-fossil raw materials. Since Covestro is not backwards integrated into fossil fuels, we can easily replace our acetone or phenol feedstocks with bio-based alternatives without a major difference in our processes, but we must still be careful the alternative feedstock is not from oils that compete with the food industry.

Do you have a final message?

Our main goals over the next year are to deliver on what we call a smart and profitable growth in solution and specialties, prepare our sites for the next investments, and advance our roadmap to becoming fully circular.