Forest Chemicals Review
Transcription
Forest Chemicals Review
Formerly Naval Stores Review September – October 2006 Volume 116, Number 5 F E AT U R E S 4 | Seedlings – Notes from the Editor by James M. Turner 5 | Increasing Resin Production from Pinus halepensis by Using New Resin-Tapping Stimulants by Christos Gallis, A. Papajannopoulos and E. Papadopoulou 8 | Highlights from PCA International Conference in Brazil 10 | Distillations – The Rising Tide of Imports by Consuming Countries By Don Stauffer, Associate Editor 12 | Company Spotlight – PDM D E PA R T M E N TS 13 | Industry News 16 | Management Topics 17 | International Scene 18 | People in the Industry Quotable "There's no reason to be the richest man in the cemetery. You can't do any business from there." –Colonel Harland Sanders [1890 – 1980], founder of Kentucky Fried Chicken restaurants COVERING THE PINE CHEMICALS I NDUSTRY SINCE 1890 PUBLISHER Romney Kriedt-Richard Charley Richard E DITOR James M. Turner The famous management consultant and industrial quality guru W. Edwards Deming once said, "It is not necessary to change. Survival is not mandatory." True enough, but it would appear that the forest chemicals industry is intent on surviving into the future, as change is all around us. This issue of Forest Chemicals Review discusses many of the changes occurring in our industry. We highlight the presentations—which covered the changing global landscape from REACH regulations to cell phone-equipped gum dip traders to cholesterol-reducing pine extracts—from the Pine Chemicals Association International Conference in Rio de Janeiro. Our feature article presents some new methodology for the old pine tree tapping process. The migration of USA and EU imports from basic rosin raw materials to derivatives is reviewed in "Distillations". This issue's "Management Topics" addresses some recent developments regarding chemical site security. Legal interaction between US and foreign companies, this time involving the iconic "Bazooka" bubble gum brand in Argentina, can be found in "International Scene." Don't miss "Industry News" for important recent events. And for those readers who have joined the Sudoku craze to while away their lunch hours, Forest Chemicals Review has furnished a puzzle for your enjoyment. As always, thanks to our readers, subscribers, and advertisers. Let us hear from you on what you would like to see in Forest Chemicals Review. ASSOCIATE E DITOR Don F. Stauffer E DITORIAL ADVISORY BOARD Mack Harashima Alan Hodges, Ph.D. B.S. Kapoor Don Neighbors PANEL OF R EFEREES Dr. John Heitmann Dr. James Russell PRODUCTION MANAGER Mindy Walker ACCOUNTS MANAGER Carol Tovrea FOREST CHEMICALS REVIEW is editorially directed to producers and processors of pine gum and wood naval stores; producers and processors of pulp chemicals such as black liquor, soap skimmings, tall oil and turpentine; and producers and processors of pine derivative chemicals for the adhesives, coatings, printing ink, paper chemicals, flavor and fragrance, solvent and household products industries. FOREST CHEMICALS REVIEW (ISSN 1520-0191) is published bi-monthly and the INTERNATIONAL YEARBOOK is published annually by Kriedt Enterprises, Ltd., Editorial & Executive Office at 129 South Cortez Street, New Orleans, Louisiana 70119, U.S.A. Telephone (504) 482-3914, FAX (866) 270-3485, e-mail: info@forestchemicals.com web: www.forestchemicalsreview.com Periodical postage paid at New Orleans, Louisiana 70113. POSTMASTER send change of address to FOREST CHEMICALS REVIEW, 129 S. Cortez St., New Orleans, LA 70119. Subscription rates for six issues of FOREST CHEMICALS REVIEW and the INTERNATIONAL YEARBOOK $110 domestic and $145 for international. Copyright 2006 4 www.forestchemicalsreview.com September – October 2006 FOREST CHEMICALS REVIEW Increasing Resin Production from Pinus halepensis by Using New Resin-Tapping Stimulants Christos Gallis*, A. Papajannopoulos, E. Papadopoulou Forest Research Institute 57 006, Vasilika, Thessaloniki, Greece. *Corresponding author: Forest Research Institute 57 006, Vasilika, Thessaloniki, Greece. Tel.: +30 231 0 461 172, Fax: +30 231 0 461 341, email: cgalis@fri.gr Abstract This paper describes a study of the influence of three-resin tapping stimulants (pastes) on total resin production and bark removal area in Pinus halepensis forests. Two experimental pastes (paste A and B) and a commonly used paste (K) were applied in resin tapping Pinus halepensis field trials in two areas, Agia Anna and Kirinthos, of the island Evoia in Greece. At the end of the tapping period resin was collected and weighted. The average area of bark removal was empirically estimated. The results show that the application of the experimental pastes A and B increased the average resin production in comparison with that from paste K by 5.75% for paste A and 7.83% for paste B and decreased by 50% the total bark removal in comparison with that of common paste. Key words: Resin tapping, new stimulants, resin production, Pinus halepensis. Introduction A historically broadly accepted method for increasing resin production and productivity of labour during resin-tapping, is by inducing trees to produce more resin through the use of various chemical stimulants (pastes) that are placed on the resin-tapping wounds (Prasad and Joshi, 1974; Zinkel and Russel, 1989, Tsoumis, 1992, Song, 1999, Plowden, 2002). At present, the substance used by Greek resinworkers for this purpose is “sulphuric acid paste” (Papajannopoulos and Papadopoulou, 1995). This substance presents the following drawbacks: a) removal of the bark is time-consuming work, since the removal and necrosis of the bark is extensive and reaches a great height, which increases the total amount of time spent by resinworkers on each tree during the resin-tapping period, and b) when the annual bark removal is extensive, the trees with the highest productivity quickly dry up and need to be replaced by other trees, which at least during the first few years of resin-tapping – produce both less resin and require additional time and effort for cutting paths and trimming around the perimeter. In the international bibliography, there is also mention of other preparations considered capable of ensuring a greater annual resin production per tree (Coppen and Hone, 1995). Such substances, a mixture of sulphuric acid and nitric acid, were prepared and tested by the Forest Research Institute (FRI) in a previous study (Papagiannopoulos and Papadopoulou, 1995) as regards their degree of fluidity and crystallization, of which two were chosen which presented the best characteristics (Papagiannopoulos, 2003). The pastes are a mixture of sulphuric acid and nitric acid to which September – October 2006 FOREST CHEMICALS REVIEW water and kaolin powder have been added, along with a substance under the code name DDBS. These experimental pastes must be able to a) ensure a greater production of resin and consequently a higher income and productivity for workers compared to the sulphuric acid paste used by resin-workers today, and b) increase the resin-tapping total period per tree by requiring less bark removal and causing necrosis to a smaller area after each bark removal. It was precisely such a study that the FRI undertook to carry out within the framework of the EU programme Recite II-Transnational Woodland Industries Group (TWING) (Final TWING Scientific Report, 2002). The tests for the two experimental types of paste took place in two areas, Kirinthos and Agia Anna, in the northern part of the Greek island of Evoia. The main purpose of this paper is to describe and compare the influence of the two new pastes and the one common in use on total resin production and average bark removal area. Material and Methods The common commercial traditional paste (type K) and the two new experimental pastes were tested under real resin-tapping conditions in two areas with Pinus halepensis Mill. resin-producing stands in Kirinthos and Agia Anna, www.forestchemicalsreview.com 5 Type of Paste Experimental area of Experimental area of Agia Kirinthos (number of trees) Anna (number of trees) Common paste K 80 80 Paste type A 80 80 Paste type B 80 80 Total number of trees 240 240 Table 1. Number of trees per experimental area and paste type. Resin production in Kirinthos experimental area (in Kg) Common paste K 547 Experimental paste type B 613,3 Experimental paste type A 603,5 Type of paste Resin production in Agia Anna experimental area (in Kg) 304,2 306 324,7 Table 2. Resin production per experimental area and paste type. Northern Evoia in 2002. The experimental area in Kirinthos consisted of mature resin-producing trees, while the experimental area in Agia Anna of trees that were tapped for the first time. The content of these two new types of paste is: sulphuric acid 30%, nitric acid 15%, kaolin powder 20%, water 35% and DDBS at a proportion of 0.25% (experimental paste type A) and 0.5% (experimental paste type B). The content of the paste type K was 60% sulphuric acid and 40% a mixture of kaolin powder and water. The three types of resin-tapping paste were applied in two experimental areas in the locations of Kirinthos and Agia Anna, Northern Evoia, in the beginning of April 2002. In total, 480 trees were treated. In each area, the trees were divided into three groups of 80 individuals that were treated with one of the paste types (Table 1). A horizontal strip of bark 2-2.5 cm high and 8 cm wide was removed across the width of each tree, at the chest high, to cause the resin to flow and the chemical stimulant applied along the top edge of the exposed tissue ('streak'). After 6 www.forestchemicalsreview.com the resin-tapping incision was made, a special plastic bag was attached to each tree to collect the resin, and the paste (stimulant) that corresponded to each tree was applied. The stimulant causes and maintains resin flow for a period of time and the tapper need not repeat the task until some weeks later, at which time the bark is removed above and adjacent to the first streak. The size of the, above the first streak, bark removal is related of the size of necrosis caused to the tissue from the previous paste application When each bag was filled with resin, replaced by a new bag. Each retrieved bag was immediately weighed on site. At the end of the resin-tapping period, in November 2002, the final collection of each bag from each tree was made, regardless of treatment, and these were weighed on site. Then the total resin production for each experimental field was calculated. Individual tree resin production was no weighted and registered separately while the purpose of this research was to compare total production between pastes and not production between trees. Also, a visual empirical observation was made of the size of the bark removal incision required for each of the three pastes. Results and Discussion The total resin production for both experimental areas and in relation to the applied pastes is presented in Table 2. The average resin production for both areas for pastes A and B was 5.75% and 7.83% respectively higher that for paste K. In the mature resin-producing tree area of Kirinthos, experimental paste A produced more resin than the other two pastes and experimental paste B performed better than common paste K. The performance of paste type A was slightly higher than that of paste B (1.61%, 9.8 kg) and relatively higher than paste K (10.82%, 68.3 kg). The performance of paste B was also relatively higher (9.36%, 56.5 kg) than paste K. In the first-time tree-tapped area of Agia Anna, the performance of experimental paste A was relatively lower (6.11%, 18.7 kg) than that of experimental paste B and slightly higher (0.59%, 1.8 kg) than paste K. And the performance of experimental paste B was relatively higher (6.31%, 20.5 kg) than paste K. In both experimental locations, the visual empirical observation of the resin-tapping incision showed that the incision for the two pastes A and B is the same size, whereas the size of the incision for common paste K is definitely larger. The incision average size for common paste K was approximately 50% larger (in total and per incision) than the incision size of the two experimental pastes. This difference can be seen in figures 1 and 2. The comparative application test of three resin-tapping pastes in areas of Northern Evoia showed that the resin production rate from the two new pastes was comparatively greater, while the size of the September – October 2006 FOREST CHEMICALS REVIEW bark scraping was considerably smaller. In particular, paste B performed better than common paste K in both experimental locations. In the experimental area of Agia Anna, paste B performed better than paste A; while, in the experimental area of Kirinthos, paste A performed better than paste B. In average for both experimental areas pastes A and B performed better than paste K. The bark scraping size was the same for both experimental pastes A and B, and was 50% smaller than that of common paste K. Conclusion It is clear that the two new pastes contribute to an increase in annual resin production per tree. The increase in resin production per tree may be due to the presence of nitric acid and the substance coded DDBS in the new pastes. Furthermore, apart from the direct increase in resin production that will positively impact on the resin producers’ income, another indirect increase of an unknown measure is also expected, due to the fact that the trees with the highest productivity will be tapped for a longer period, when their annual bark scraping is less extensive. Subsequently, this will also delay the need to replace such trees with others, which produce less resin – during the first years of resin-tapping – and require considerable time and effort for cutting paths and trimming around the perimeter. Future research may focus on the above parameters. References Coppen, W., and Hone, G.A. 1995. Non-wood Forest Products2: Gum naval stores: turpentine and resin from pine resin. Natural Resources Institute, FAO, Rome. Final TWING Scientific Report. 2002. European Programme RECITE II“Transnational Woodland Industries Group (TWING)”. Final Scientific Report, Forest Research Institute, July 2002, Thessaloniki, Greece. Papajannopoulos, A. 1985. Studies on resin tapping in Pinus halepensis and brutia forests. Doctoral dissertation, Faculty of Forestry and Natural Environment, Aristotle University. Papajannopoulos, A. and Papadopoulou, A. 1995. The present of resin tapping in Greece. Geotechnical Scientific Annals, Vol.2, pp.58-69. Papajannopoulos, A. 2002. Bulletin of resin tapping. Publication of the EU programme Recite II-TWING, 52 pages. Plowden, C. 2002. The harvest and sale of Breu Resin from Burseraceae Trees in the Eastern Brazilian Amazon. Forestry Chemicals Review, July-August 2002:10-15. Figure 1. Annual resin tapping bark removal area: A) with the use of experimental paste; B) with the use of common paste. Prasad, J., Joshi, H.B., 1974. Effect of Chemical stimulation on Chir resin yield. Indian Forester, 100(4):246249. Solis, W. and Zamorano, Z.L. 1974. Caracteristicals Y Utilization de la pasta “IFIE” Como Estimulante de Resinacion. INIA, Hoja Technica No.2, Madrid. Song, Z.Q. 1999. Production and research of gum oleoresin in China. Forest Chemicals Review, MayJune 1999:7-9. Tsoumis, G. 1992. Harvesting forest products. Stobart Davies Ltd., Hartford, England. Figure 2. Resin tapping bark removal area per incision: A) with the use of experimental paste; B) with the use of common paste. Zinkel, D. and Russel, J. 1989. Naval Stores. Production-ChemistryUtilization. Pulp Chemical Association, New York. September – October 2006 FOREST CHEMICALS REVIEW www.forestchemicalsreview.com 7 Highlights from PCA International Conference in Brazil On September 24-26, the Pine Chemicals Association held its 2006 International Conference at the beautiful Copacabana Palace Hotel in Rio de Janeiro, Brazil. Formerly known as the PCA Naval Stores Conference and an autumn fixture for decades in our industry, this was the first to be held in South America. The warm Brazilian hospitality was evident from the opening reception on Sunday evening, but the weather on the days of the conference unfortunately was uncharacteristically cool and damp. The conference concluded on Tuesday evening with a Carnival celebration dinner on Sugar Loaf. Official proceedings for the 167 delegates began Monday morning with an introduction by conference chairman Bernardo Mello of Resitec and a welcome by Gerry Marterer of Arizona Chemical, PCA president. A moment of silence was observed in remembrance of Dave Germain, who passed away in July. The General Sessions on Monday and Tuesday morning featured several presentations on topics of interest to the pine chemicals industry. Gerry Cross of Eastman moderated the first day, and Brad Crocker of Hexion served as session moderator on Tuesday. Brief summaries of the presentations follow. Summary of Presentations An Outside Look at the Chinese Gum Rosin Business, by Norbert Jagers, Eastman Chemical Co. After opening with a general description of the sources, chemistry, and utilization of pine rosin, Mr. Jagers shared historical figures on production and exports of gum rosin from China. Production has grown from less than 20,000 MT in 1936 to an estimated 700,000 MT in 2005, with nearly 60% of that volume 8 www.forestchemicalsreview.com exported. An interesting graph showing monthly exports and value over the last three years was presented. Mr. Jagers closed with a discussion of the Chinese gum rosin supply chain from forest to ocean vessel. A new link in that chain, the gum dip trader armed with cellular phone and speculative intent, was identified as a now integral part but with questionable added value. REACH Status by Philippe Salémis, HARRPA REACH is the acronym for the European Union's initiative for the Registration, Evaluation, and Authorization of CHemicals. After pointing out that it is "the most complicated piece of legislation ever produced in Europe", Mr. Salémis presented a overall summary of the program, including its objectives, timeline, registration process, consequences, and the substances affected. In general, products, including substances, preparations, monomers, and oligomers, must be registered in the REACH system to be sold in Europe, although food and wastes are fully exempted. REACH also does not apply to polymers. REACH goes into effect in April 2007, after which there is an 18-month pre-registration window. Following pre-registration, substances must be registered within 3 to 11 years depending upon volumes and toxicity. Compliance with REACH is a massive task for the chemical industry. Sustainable Gum Rosin Production, by Transtoto Handadhari, Perum Perhutani Perum Perhutani is a state owned forestry enterprise in the Republic of Indonesia, and is principally charged with managing 2.5 million hectares of forest resources in Java and Madura. In this presentation, Dr. Handadhari summarized the activities of Perum Perhutani, which include research and development, productivity and quality improvement, forest management, and production and marketing of rosin and turpentine. The uniqueness of Indonesian Gum Rosin, which is derived from Pinus merkusii, was highlighted. Perum Perhutani has invested heavily in oleoresin processing facilities over the last 20 years to modernize equipment and improve commercial product quality to international standards. Sustaining the productivity of forest lands in collaboration with development of adjacent communities is an ongoing priority. Plant Sterols by Joy Foster, Cargill Health & Food Technologies An international provider of food, agricultural, and risk management products and services, Cargill has over 100,000 employees in 60 countries and generates over US $70 billion in annual revenues. Ms. Foster discussed the effect of high blood cholesterol on human health, highlighting by country both the incidence and degree of concern. This led to a discussion of plant sterols, which can be sourced from vegetable oils and tall oil pitch, and their mechanism of action in the human body in inhibiting the absorption of both dietary and biliary cholesterol. The net result is a lowering of LDL cholesterol, a major biomarker in cardiovascular disease. Plant sterols are GRAS for use in low fat spreads, dressings, cereals, bars, drinks, and other specified products, and are recommended for use by various health authorities. Because of the proven health benefits, abundant supply, broad applications, and large marketplace, Cargill forecast annual plant September – October 2006 FOREST CHEMICALS REVIEW sterol growth of between 9% and 12% in the US and EU markets between now and 2012. Guest Speaker – Monday Luncheon Dr. Joel Reno, Past President, Petrobras The PCA invited Dr. Reno to be the keynote speaker at the conference luncheon. Petrobras is the largest energy company in Brazil and is renowned for its leadership in development of advanced technology from deepwater and ultra-deep water oil production. Dr. Reno's remarks addressed the role of energy in the economic development of the world, noting that poorer countries cannot advance until they secure sufficient energy resources. He noted that the global oil trade is about US $1 trillion, which equates to about 31 billion barrels/year. Current daily demand for oil is 84 to 85 million barrels, versus production of 86 million barrels per day. Turning his attention to Brazil, Dr. Reno presented the strides in energy management that his country has taken. Over 90% of Brazil's electricity is from hydroelectric source. In April, Brazil became totally self-sufficient on oil, producing all of the 1.9 million barrels per day consumed in the country. This achievement was in large part a result of the alcohol fuel initiative begun some 30 years ago. Brazil now produces 15 billion liters of fuel alcohol from sugar cane. Wood and Gum Rosin Esters Compared by Fredo Arias-King, T&R Chemicals, Inc. Since 1963, a U.S. FDA regulation (21CFR172.735) permitted only one type of rosin ester for use to adjust the density of citrus oils in beverages: glycerol ester of wood rosin (GEWR). Mr. Arias-King recounted the technical analysis and petitioning that eventually resulted in the 2005 change to this regulation to include glycerol ester of gum rosin (GEGR). An initial petition to have GEGR declared GRAS for such use was not approved by FDA, apparently influenced by intense lobbying by Senator Biden from Delaware. Following that, efforts were redirected to revise the 21CFR regulation itself. Tools used in this effort included history of safe use, infrared spectroscopy, gasliquid chromatography, nuclear magnetic resonance, and glass transition temperature. Mr. Arias-King presented graphical comparisons of the analyses of the two substances. The FDA's Final Rule on the matter stated in part, "While FDA agrees that there are differences in raw material sourcing and processing for GEGR and GEWR, FDA has concluded that the compositions of theses two substances are so similar that any difference are not of toxicological concern for the petitioned use." Energy Markets and Trends by Goran Forsberg, Tall Oil AB Dr. Forsberg presented perspectives on the global energy picture— types, consumption, supply sources, growth, and future alternatives. Areas that may concern countries include physical supply of energy, prices on energy and the associated effects on economic growth, and the kind of energy sources used. Examples from Sweden's reduction in dependence on oil products in the last 30 years were cited. Carbon dioxide emissions and their effect on climate were discussed. Bioenergy and other renewable sources are regarded as promising alternatives but are still in their infancy from a world perspective. Rising prices for conventional energy solutions create opportunities for efficient use of energy, renewable sources, and non-conventional fossil fuels. September – October 2006 FOREST CHEMICALS REVIEW Pay Attention to Chinese Domestic Market of Gum Rosin by Li Yi, Secretary General of China Forest Chemicals Trade Association China has long been the world's largest producer and exporter of gum rosin, but China's rapid growth is consuming more and more rosin internally. Ms. Li Yi stated that the domestic demand for rosin has doubled from 150,000 tons to 300,000 tons from 2001 to 2005, and is projected to top 400,000 tons by 2008. She also noted the increase in domestic rosin derivatives, which in 2005 reached 150,000 tons. Consumption and projected growth in inks, coatings, adhesives, synthetic rubber, chewing gum, paper size, and wax printing were presented. Conclusions were that domestic consumption in China is growing faster than production and that domestic prices would tend to be higher than export prices. ANIPIN – The Brazilian Association of Gum Rosin Producers by Alejandro Cunningham, Secretary of ANIPIN ANIPIN is a consortium of companies involved with the pine chemicals industry in Brazil. Its activities are organized around three pillars: Institutional, by representing the interests of all 17 member companies both locally and internationally; Economical, by providing economic information about the sector; and Technical, by developing and promoting the technical evolution of products and services. ANIPIN organizes an annual Brazilian Pine Chemical Seminar, and works closely with the PCA. Brazil's gum rosin industry has grown considerably since the 1970's, and the country became a net exporter of rosin in 1989. Future concerns are to have a sustainable pine forest resource to safely produce crude gum and to develop a healthy derivatives industry. www.forestchemicalsreview.com 9 The Rising Tide of Imports by Consuming Countries We have recently become aware of the rapidly growing exports of rosin derivatives from China to the major consuming countries, especially Europe and the USA. It is not surprising since China now produces approximately 74% of the world’s gum rosin and 52% of all types of rosin. In the past, major consuming countries have imported gum rosins from China and other producing locations and converted this imported raw material to derivatives in sophisticated indigenous equipment. Actually, this procedure, often promoted by nationalism and sometimes by governmental subsidies, involved needless economic use of resources including the cost of drumming and de-drumming rosin and the utilization of illogical shipping containers. Some time ago, the Japanese recognized a need for their finished product derivatives in the developing economy of China. Led by Arakawa, Harima and Toho The 2006 Edition of the Study of International Rosin Markets is now available Published biennially since 1976, this 150 page comprehensive Study examines the current global situation of rosin and its derivatives, as well as tall oil, fatty acids, turpentine and other terpenes. Detailed information on production, distribution and utilization of all products is presented. To receive a valuable aid for your business profitability, order two copies, delivered first class - $3,200. INTERNATIONAL DEVELOPMENT ASSOCIATES Post Box 702 Mendenhall, Pennsylvania 19357, USA Phone (610) 388 2135 – FAX (610) 388 7067 e-mail <IDA.Stauffer@verizon.net> 10 www.forestchemicalsreview.com Chemical, they established producing units in China to serve this developing market. However, they quickly became aware of the superior economic results of utilizing rosin at its source locations and began to export these derivative products to other Asian locations, including Japan. Western rosin derivative producers quickly recognized the logic of locating in China and, led initially by Lawter, began to establish producing units in that country. I have no doubt each of them in turn told their Board that they wanted to produce in China to serve the growing domestic market, but I am equally certain that their hidden desire was to serve global markets more efficiently. The Chinese are intelligent people and their basic rosin producers quickly adopted the strategy of producing derivatives for both the domestic and export markets. As a result of these activities, in the first six months of 2006 China exported 37,346 tons of rosin derivatives, up from 32,784 tons in the same period of 2005; an annual growth of 13.9%. Japan was the largest consumer with 23.1% of the total. Europe and the USA collectively consumed 30.2% of the total. The annual growth rate in European consumption was 11.5%, and USA consumption rose by a spectacular 67.0%. A marketing manager with a leading USA rosin dealer recently told this writer, “Every known rosin derivative is now available from China with standard quality.” Turning to USA import statistics, we find that in the first half of this year, 7,780 tons of various rosin derivatives were imported from all sources versus 6,970 tons in the same period last year. This represents an annual increase of 13.6%. Of the total in the current year, 1,105 tons were classified as salts; 2,876 tons were esters and 3,899 September – October 2006 FOREST CHEMICALS REVIEW tons as resin acids and derivatives thereof. It is interesting to note that major use of this last catch-all category is being used by USA importers, as well as those from other destinations. It is also noteworthy that in the first half of the current year 22,705 tons of hydrocarbon resins were imported by the USA versus 21,564 tons in the previous year; an increase of 5.3%. Finally, the European import situation is also of interest. This year in January through June, European countries imported 365 tons of salts from sources outside of Europe; down from 515 tons last year. Ester imports by the Europeans were also down from 6,498 tons in 2005 to only 5,278 tons in 2006. However, these declines were more than made up in the resin acid and derivatives thereof category, which rose from 5,764 tons last year to 8,162 tons in the current year; an increase of 41.6%. Overall, European importation of rosin derivatives from sources outside of Europe were 13,805 tons in the current year; up 8% from 12,777 tons in 2005. It is obvious that European importers are increasingly categorizing imports in the catch-all category; we think deliberately. By using this technique, it is possible to disguise the identity of the imports and their value. Although there may be nothing illegal in this procedure, one might call it devious. Obviously, USA and European importation of rosin derivatives is on the rise and, in this writer’s opinion, likely to increase at about the same rate in the coming years. It makes sense to import derivatives from China and other producing countries such as Brazil rather than to import gum rosin itself for the production of the same derivatives in local facilities. The USA dominated the production and exportation of rosin derivatives during the years when the USA was the dominate producer of rosin. This leadership is now in the process of changing to China and Brazil. Advertise in Forest Chemicals Review 129 S. Cortez St. • New Orleans, LA 70119 USA Phone: 504-482-3914 • Fax: 504-482-4205 Email: info@forestchemicals.com September – October 2006 FOREST CHEMICALS REVIEW www.forestchemicalsreview.com 11 PDM, or Pine Derivatives Marketing, Inc., is a long-established importer and reseller of a variety of pine rosin-based resins for a wide variety of end uses. Based in Wilmington, Delaware, PDM's staff services customers throughout North America, utilizing affiliated warehouses in Piscataway, NJ, Houston, TX, and Berkeley, CA. PDM was founded in 1974 by Walter (Bud) Cleaver, Sr., a pioneer in opening the channels for the importation of Chinese gum rosin to the U.S. He visited China dozens of times for Hercules Incorporated. Upon his retirement in 1974, he continued his efforts by marketing Chinese, Portuguese and Brazilian gum rosin as President of Pine Derivatives Marketing, Inc. Today, Walt Cleaver, Jr., President, is continuing his father's tradition by offering imported gum rosin, modified resins, and other pine chemicals throughout North America. The company's mission is to "provide our pine derivative cus- tomers with the highest quality resins at competitive prices with just-in-time service." Adhesives, sealants, inks, coatings, and construction materials are just a few of the industries served. In addition to general management, Mr. Cleaver handles procurement for the company. Joining him on PDM's team are: • Bob Wherry, Sales & Marketing Manager, Resins—field sales and technical support • Don Thureau, Sales & Marketing Manager—inside sales, pricing, inventory • Joann Murray, Administrative Manager—imports, order processing, accounting • Mrs. Cleaver, Office Coordinator PDM markets a variety of gum rosins, modified resins and other gum rosin derivatives from companies such as Resinas Yser, EuroYser, Resitec, Oxiquímica, Golddragon, and others from Brazil, China, Portugal, and other countries. For many years, PDM traded in citrus limonene, but they have totally exited that market to concentrate on resins (gum turpentine and dipentene are still offered, however). Annual turnover varies with market conditions but usually exceeds US $10 million. PDM is a member of the Pine Chemicals Association. PDM monitors the quality of their products and services through a comprehensive quality control system. PDM, Inc. 3411 Silverside Road, 104 Webster Building Wilmington, DE 19810 U.S.A. www.pdmchemicals.com 12 www.forestchemicalsreview.com March–April 2006 FOREST CHEMICALS REVIEW Weyerhaeuser to Combine Fine Paper, Papergrade Pulp, Related Assets with Domtar. Weyerhaeuser news release, August 23, 2006 Weyerhaeuser Company announced that it has reached a definitive agreement to combine its Fine Paper business and related assets with Domtar Inc. The transaction gives Weyerhaeuser shareholders 55% ownership in the new company. Total transaction value is $3.3 billion and is expected to close in the first quarter of 2007. “This transaction will create the North American market leader in fine paper," said Steven R. Rogel, chairman, president and chief executive officer. “This important milestone transforms Weyerhaeuser into a company with a more focused business portfolio and allows our team to concentrate its full attention on the execution of strategies in our core businesses,” Rogel said. Weyerhaeuser manufacturing assets included in the combination include: • Eight paper mills and associated pulp mills (Dryden, Ontario; Hawesville, Ky.; Johnsonburg, Pa.; Kingsport, Tenn.; Bennettsville, S.C.; Plymouth, N.C.; Prince Albert, Saskatchewan; Rothschild, Wis.). • 14 converting centers • The market pulp mill at Kamloops, British Columbia. • The coated groundwood mill in Columbus, Miss. • Two softwood lumber mills Hexion Purchases Adhesives & Resins Business Of Orica Limited. Hexion news release, August 24, 2006 Hexion Specialty Chemicals, Inc. announced today that is has signed a definitive agreement to purchase the adhesives and resins business of Orica Limited. Terms were not disclosed. The Orica adhesives and resins business manufactures formaldehyde and formaldehyde-based binding resins used primarily in the forest products industry. The business includes three manufacturing facilities located in Deer Park (Victoria) Australia, and Mountview and Hornby, New Zealand. The business had 2005 sales of $104 million and employs 100 people. BASF to Expand U.S. Pressure Sensitive Adhesives Capability. BASF news release, August 29, 2006 BASF announced today that it is investing $4.9 million in its acrylic emulsion manufacturing facility in Monaca, Pennsylvania, to increase its capability to produce coaterready adhesives. The company also revealed that it would launch, at Labelexpo 2006, three new pressure sensitive adhesive (PSA) polymers to provide greater choice to label, graphics and tape manufacturers. Flint Group News Ink Division Announces National Price Increases. Flint Group news release, September 15, 2006 Flint Group News Ink Division September – October 2006 FOREST CHEMICALS REVIEW announced national price increases for coldset and news offset ink products, effective October 1, 2006. The price increases include black and color inks and vary depending on product type. "Since October 2005, our news ink operations have received over 80 raw material price increases from our supply base of approximately 30 key suppliers. Global demand for chemical raw materials in developing regions of the world has significantly tightened supply of basic chemicals used by the newspaper printing ink industry, including Flint Group. We are now competing for supply from historic raw material sources that in many cases, now have greater value in other developing global markets and industries. Our ink price increases are necessary to offset the continuing escalation of raw materials, energy, and freight costs," says Mike Green, vice president – general manager of Flint Group North America News Ink Division. US Ink Announces Price Increases for Coldset and News Ink Products. Sun Chemical news release, September 29, 2006 US Ink, the largest news ink manufacturer in the United States and a division of Sun Chemical, today announced price increases for coldset and news ink products, effective November 1, 2006. The price increases will vary depending on product type. "Despite our best efforts to offset rising costs, the increased global demands for raw material feed stocks have created price escalation across a broad range of raw materials used in our inks," said Greg Lawson, president of US Ink. "Raw material price increases and increased distribution costs make this price increase unavoidable." www.forestchemicalsreview.com 13 National Starch Expands Plant to Meet Demand for Adhesives, Polymers, Electronic Materials. National Starch news release, September 19, 2006 National Starch and Chemical Company marked the official opening of its expanded adhesives, synthetic polymers and electronic materials manufacturing facilities at its Salisbury, NC, plant. National's multimillion-dollar investment in the new facility will accelerate the company's efforts to supply highquality, innovative adhesives to the pressure sensitive and transdermal markets, specialty polymers to the hair care and skin care markets, and custom resins and fillers used in the manufacture of adhesives, coatings and encapsulants for electronic assembly, according to company officials. The new facilities add over 10,000 square feet of production area to the existing Salisbury manufacturing site. More than 30 new employees have been hired to support the company's expanded manufacturing capabilities. GE Sells Advanced Materials Business to Apollo Management, L.P. GE press release, September 15, 2006 GE announced that it has signed a definitive agreement to sell GE Advanced Materials (Silicones & Quartz) to Apollo Management, L.P., a private investment firm in a deal valued at approximately $3.8 billion in cash and securities. Upon completion of the transaction, GE will receive a 10% ownership stake in the new company and hold $400 million of notes. GE Advanced Materials is a $2.5 billion supplier of silicone-based products, silanes, sealants, urethane additives and adhesives; and high- purity fused quartz and ceramics materials. It is headquartered in Wilton, Conn. and employs 5,000 people in 38 locations worldwide. Adhesive and Sealant Demand Expected to Grow 2.9% Through 2007. Adhesive and Sealant Council, Sep 22, 2006 The Adhesive and Sealant Council's (ASC) 2005-2007 North American Market Study for Adhesives and Sealants with a Global Overview estimates the North American demand for adhesives and sealants to rise 2.9% through 2007. The size of the 2005 total world market for adhesives and sealants was estimated at 22.4 billion pounds valued at $US 33.4 billion. The study provides adhesives and sealants market data for North America, Western Europe, the Far East, Latin America and the Rest of World. It provides market share and forecasted growth rate information on adhesives and sealants, broken down by both technology and enduse application. Hercules Raises Pentaerythritol Prices. Hercules press release, September 11, 2006 Hercules Incorporated announced that its Paper Technologies and Ventures Group will initiate a price increase for all grades of Mono, Technical and Di Pentaerythritol of 12 cents per pound. This increase is effective October 1, 2006 or as soon as commitments allow. Continuing escalation of raw material, energy and transportation costs are driving this price increase. Hexion Declares, Lifts Force Majeure. Hexion news releases Hexion Specialty Chemicals declared on August 24 force majeure for formaldehyde and formaldehyde-derived products. The 14 www.forestchemicalsreview.com September – October 2006 FOREST CHEMICALS REVIEW announcement followed Hexion being placed on allocation for methanol, a key raw material in the production of formaldehyde and formaldehyde-based products, as two major methanol producers had previously declared force majeure. The force majeure status was lifted on October 2 and normal operations resumed. Chemical Market Reporter Renamed. Effective with the September 4th issue, Chemical Market Reporter magazine has been relaunched as ICIS Chemical Business Americas. Begun in 1871 as the Oil, Paint, and Drug Reporter and renamed in 1972 to the Chemical Marketing Reporter, the publication has been a weekly stalwart for readers in the chemical industry. Dropping the "ing", it became Chemical Market Reporter in 1997. In 2000 the publication was purchased by Reed Business Information, parent of ICIS, the "world's largest information provider for the chemical and oil industry", who implemented a major format change in 2005 from tabloid newspaper to magazine. Hexion To Standardize Pricing Practices For North American Inks Market. Hexion news release, September 7, 2006 As part of an effort to simplify business practices and enhance service, Hexion Specialty Chemicals is standardizing pricing practices across all product lines for the North American inks market. Hexion is instituting marketbased pricing and eliminating both list and off-list pricing policies that have developed over the years. The new standardized pricing structure will apply to all Hexion products for the North American inks market, including those from the recently acquired ink resins business of Akzo Nobel. Most product pricing will be based on a "per pallet" basis. Hexion also will decouple freight cost from product pricing. Rohm and Haas Announces Price Increases for Adhesives. Rohm and Haas news releases, September 29, 2006 Rohm and Haas Adhesives and Sealants business will implement the following regional price increases in October or as contracts allow: • 5 to 10% price increase for acrylic, vinyl acrylic and styrene acrylic emulsion and solution polymer products sold to the pressure sensitive, construction adhesive,caulk and sealant industries in Europe,Central/ South America and North America. • 8-10% price increase for polyester,polyurethane and acrylic polymer products sold to the packaging and converting industries in Asia • 10 -15% price increase for acrylic, vinyl acrylic and styrene acrylic emulsion and solution polymer products sold to the pressure sensitive, construction adhesive, caulk and sealant industries in Asia and Pacific Region. Increases are necessitated by continued escalation in costs due to significant supply/demand imbalances for key raw materials. Subscribe Now! Forest Chemicals Review 129 S. Cortez St. New Orleans, LA 70119 USA Phone: 504-482-3914 Fax: 504-482-4205 info@forestchemicals.com T&R CHEMICALS INC. SUPPLIERS OF PINE-OIL AND HYDROGENATED ROSIN RESINS FOR CHEWING GUM BASE AND ADHESIVES 700 CELUM ROAD P.O. BOX 330 CLINT, TEXAS 79836 TELEPHONE: 1-800-351-6025 FAX: (915) 851-2961 September – October 2006 FOREST CHEMICALS REVIEW www.forestchemicalsreview.com 15 Chemical Site Security The tragic occurrences and continued threat of terrorist attacks in today's world have underscored the reality that materials of heretofore peaceful industry can and will be used as weapons. Shortly after the September 11, 2001 attacks, experts and officials identified chemical plants as prime targets for terrorist plots. Since then, various pieces of U.S. federal legislation regarding chemical site security have been proposed and debated in Congress. But private enterprise has acted as well. Three industry associations--the American Chemistry Council (ACC), the National Association of Chemical Distributors, and the Synthetic Organic Chemical Manufacturers Association--require members to conduct vulnerability assessments, develop plans to reduce those risks, and have a third party verify the implementation of security enhancements. Other industry groups, in the meantime, have established best 16 www.forestchemicalsreview.com practice guidelines, and independent companies have taken steps to secure the perimeter of their facilities. While the chemical industry has generally advocated federal regulations that address plant security, it is a complex issue with many divergent viewpoints. Resources of large versus small companies, States' rights, and proprietary versus public domain information are but a few of the areas of debate. Some movement occurred in Congress on September 30th with the passage of an appropriations bill. According to a statement from ACC: The House and Senate just approved the Department of Homeland Security appropriations bill, HR. 5441, which contains language authorizing the Department to regulate security at chemical facilities. The members of the American Chemistry Council (ACC) have been in the vanguard of this issue by voluntarily securing their facilities under ACC’s Responsible Care Security Code® even as they urged Congress to pass meaningful chemical security legislation. ACC is the leading trade association of the chemistry industry, representing 133 chemical manufacturers who encompass approximately 85% of chemical production capacity in the United States. American Chemistry Council (ACC) President and CEO Jack N. Gerard issued the following statement: “ACC would like to thank Congress for their work in accomplishing our shared objective of passing meaningful chemical security legislation this year. This measure represents significant progress in the effort to secure America’s chemical industry, an essential part of the nation’s critical infrastructure. “While this bill is not a home run, Congress came through in the last inning to deliver essential chemical security legislation. “For the past several years, ACC has sought performance based chemical security legislation through the relevant authorizing committees. While we would have preferred a more comprehensive bill and still have concerns regarding certain provisions, the approved legislation gives the Department of Homeland Security(DHS) the power to establish effective national chemical security performance standards for the entire industry. “Congress has given DHS riskbased tools to ensure that chemical facilities assess potential security vulnerabilities and implement appropriate security measures. Equally important, the legislation gives DHS clear authority to inspect facilities and apply strong penalties to those that fail to comply. “ACC will work closely with DHS as it develops regulations that build on the leadership demonstrated by our member companies, who have invested nearly $3 billion on security enhancements under ACC’s mandatory Responsible Care Security Code®.” September – October 2006 FOREST CHEMICALS REVIEW Ruling Favors Argentine Chewing Gum Producer An August 31st ruling in a United States District Court allows a subsidiary of Cadbury Schweppes PLC in Argentina to continue producing Bazooka gum, a brand owned by a US company, Topps. The contract between the two companies covering the use of Topps' trademarks and formulas expired ten years ago. In the court ruling's documents, US District Judge Charles S. Haight, Jr. writes in the introduction: "This case is a tale of two companies, once friends and collaborators, now enemies and scorched-earth litigators; and of chew- ing gum." The Argentine company, Productos Stani Sociedad Anonima Industrial Y Commercial, had agreements dating back to 1957 with Topps to produce and market its gum. A 1980 Amended License Agreement licensed to Productos Stani the rights to the legal title of the trademarks "Bazooka," "Topps" and related brands in Argentina, as well as formulation technology. According to the ruling, the relationship between Topps and Productos Stani, each family-owned enterprises, began to deteriorate when Topps became publicly-owned in 1987. September – October 2006 FOREST CHEMICALS REVIEW Cadbury acquired Productos Stani in 1993. The 1980 License Agreement expired on April 30, 1996. While Cadbury Stani had clear rights to continue to use the trademarks, Topps contended that any use by Stani of "Topps Technology" after that date breached the Agreement, and sought to discontinue Stani's manufacturing of Bazooka gum. Stani denies that it has made any use of "Topps Technology" (including chewing gum formulas) subsequent to the 1996 expiration. Citing the principles of US trademark and contract laws, Judge Haight stated: "Topps's construction, that Stani received only the trademark for Bazooka gum and could not use the technology to make it, runs counter to the law of trademark. A trademark is merely a symbol of goodwill and cannot be sold or assigned apart from the goodwill it symbolizes." "Had the Amended License Agreement been intended to license so www.forestchemicalsreview.com 17 all-inclusive a concept of technology only until the expiration of the agreement on April 30, 1996, it would seem to be designed to put Stani out of business on that expiration date. At the very least, Stani would need to start over entirely in the gum business, with new plants, new methods, new processes, and all the technical components involved in the making of chewing gum." “But this could not have been what the parties intended when entering into the 1980 Amended License Agreement…The parties knew…that Stani would hold right and title in the Topps trademarks when that agreement expired in 1996. Both parties must have anticipated that Stani, in continuing the manufacture and sale of, for example, Bazooka gum, would continue to utilize at least some of the 'specialized knowledge and experience' it had acquired from Topps over the course of a 39-year relationship (1957 to 1996)." "The intent of the parties (was)…that if Stani did not default…, Stani then owned and could manufacture and sell gum under the Topps trademarks and, in doing so, was not required to cease using, or by some feat of brainwashing to unlearn, the Topps Technology with which Stani had become familiar dur- ing the preceding 39 years." This ruling did not, however, end the acrimonious litigation between the two formerly friendly companies. An additional claim by Topps for wrongful misappropriation by means of reverse engineering will go to trial. The pine chemicals industry supplies rosin esters, hydrogenated rosin esters, polymerized rosin esters, and polyterpene resins as important components of chewing gum base. [The Topps Company Inc. v. Cadbury Stani S.A.I.C., 99 Civ. 9437 Decided: August 31, 2006 U.S. District Court Southern District Of New York] Jan Schüller has been appointed REACH Initiative Director, Eastman Chemical Company, effective October 1. Schüller is currently Sales Director, Adhesives EMEA. Joseph Donahue Donald Knauss has been named chairman and CEO of Clorox, effective in early October. He is currently president and COO for Coca-Cola North America. He succeeds Robert W. Matschullat, 58, who has served as Clorox's interim chairman and interim CEO since March 2006, when Gerald E. Johnston stepped down from those positions due to illness. John McGlade has been named president and CEO by the board of directors of Air Products, effective October 1. McGlade is currently group vice president, chemicals, for the company, and is credited with leading the restructuring efforts in the chemicals group. McGlade joined Air Products in 1976. 18 www.forestchemicalsreview.com Joost Berting has been named General Manager Performance Chemicals & Intermediates (PCI) for Europe, Middle East & Africa (EMEA), Eastman Chemical Company, effective October 1. Berting is currently General Manager Coatings EMEA. Erwin Dijkman has been named General Manager Adhesives EMEA, Eastman Chemical Company, effective October 1. Dijkman is currently Business Director PCI EMEA. has joined Valspar as group vice president of global wood coatings, and will be responsible for North America, Asia and Europe. Morgan Seuberling has been appointed manager, performance improvement, for the Synthetic Organic Chemical Manufacturers Association. Ingrid Brase has been appointed global marketing manager for the pressure-sensitive adhesives business of National Adhesives, a business unit of National Starch & Chemical Co. Karen Chen Rene Smit has been appointed General Manager Coatings EMEA, Eastman Chemical Company, effective October 1. Smit is currently General Manager Adhesives EMEA. has been appointed to the position of marketing manager for skin care and make-up for Croda. Jena Kinney has been hired by Croda as the company's new marketing manager for home care and functional specialties. September – October 2006 FOREST CHEMICALS REVIEW Dietrich Crail has been appointed business director of the pressure-sensitive adhesives business of National Adhesives, a business unit of National Starch & Chemical Co.. Martha Llaneras has been promoted by International Specialty Products to senior manager, technical services, food additives North America. Christy Gouker Ryan Dirkx has been appointed vice president of research and development for Arkema. has been appointed as an inside sales representative at Vigon International. Randy Vasseur Molly Hemmeter has been named vice president of marketing for Ashland Performance Materials. has had his duties as sales director for Reichhold expanded to include the entire NAFTA region. Tom Gibson has been appointed to the position of senior vice president of advocacy for the AmericanChemistry Council. Most recently, Gibson served as senior vice president for government affairs at Portland Cement Association, and before that he was chief of staff for the Environmental Protection Agency. Suzanne Hartigan is joining the Synthetic Organic Chemical Manufacturers Association's (SOCMA) Visions department as manager of business development. Sudoku 17 A r a kawa Chemical (US A ) 10 International Development CII Kapsco Private Ltd. 11 MeadWestvaco 14 12 PDM Inc. A.V. Pound & Co., Ltd. 15 T&R Chemicals Inc. 16 Vistaurum Subscribe Now! Puzzle #7252 Fill in the grid so that every row, every column, and every 3x3 box contains the digits 1 through 9. www.sudoku-puzzles.net September – October 2006 FOREST CHEMICALS REVIEW Forest Chemicals Review 129 S. Cortez St. New Orleans, LA 70119 USA Phone: 504-482-3914 Fax: 504-482-4205 info@forestchemicals.com www.forestchemicalsreview.com 19