Why Wacker Chemie has a bigger presence in the Gulf
Wacker's GCC sales are predominantly in construction and infrastructure (File/AFP)
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With more than 60 percent of Munich-based global manufacturer Wacker Chemie’s sales in the GCC region being construction-related, its main focus will remain on expanding its supplies of polymer and silicone products for that application, a senior Wacker official has said.
Auguste Willems, the company’s executive board member, said Wacker was ideally placed to participate in the region’s construction activities with offerings that lend high quality advantages.
“Wacker’s polymers are used in lightweight applications such as thin-layered tile adhesives used in buildings and in external insulation as well as in paints and coatings. The advantages of these coatings are low odour and low VOC (volatile organic component),” highlighted Willems.
“We also have silicone resin emulsions used in coatings that are water-repellent and have high durability. If you look at the coatings of bridges, particularly in Dubai, you have salt water and sand going into the infrastructure. Silicone resin emulsions can resist high heat and harmful environmental influences such as salt water and dust. (That is why these products) go into the construction market and paints and coatings market.”
While the majority of Wacker’s GCC sales are in construction and infrastructure projects, other applications it serves include ones that have to do with textiles and household and personal care such as products for high-end garments, silicone products for personal care as in hair use, and defoamers, which are typically silicone-based, for the household segment of detergents, the official stated.
Willems said there was no question of Wacker setting up a manufacturing facility in the Gulf “from today’s perspective” because the company is very capital-intensive with regards to upstream facilities and is actually reducing investment after several expansion and investment measures.
“We don’t have that in the pipeline,” he insisted, adding, however, that it was always possible in the long term. If at all Wacker decided to have a factory in the long run it would likely be in the businesses of polymers and silicones.
However, Willems pointed out that the company offers technical capability in Dubai through its Technical Centre.
In 2002, Wacker established the Technical Centre in Dubai at its local subsidiary, Wacker Chemicals Middle East. It is certified by ISO 17025 and covers the growing demand for technical support, product development and adapted applications in the region. In 2012, it extended the technical centre by adding a dedicated laboratory for interior and exterior paints and coatings applications. Both its technical service and its Wacker Academy, which provides sector-related training and networking opportunities, help to bolster its technological leadership in the region.
Willems estimated Wacker sales in the GCC region in 2013 to be “in the double-digit-million” range.
Wacker’s sales force based in Dubai is responsible for the business in the GCC region and is supported by two key distributors, Reda Chemicals and the Zamil Group, Saudi Arabia. Reda is a general chemical distributor, whereas Zamil is more specialised in silicone sealants.
The introduction of the Green Building Code in Dubai and strict regulations related to the use of low VOC paints, adopted by the Abu Dhabi and Dubai authorities, will help Wacker’s growth.
Wacker said the new green code in Dubai has pushed demand for technologies and products supporting External Insulation Finishing Systems (EIFS) that are multi-layered and require use of its polymeric binders. The company offers its Vinnapas dispersible powders which are polymeric binders that enhance the adhesive and reinforcing mortars in EIFS. “They contribute good adhesion to all substrates, are flexible enough to accommodate different expansion coefficients of the materials used, and offer excellent shelf life and durability,” it said.
The regulations advocating low VOC paints has led to an increase in demand for Wacker’s vinyl acetate ethylene copolymer dispersions which are specifically designed to offer a host of characteristics, including low residual monomer content, and can be formulated to low VOC levels. Vinnapas dispersions have a high pigment-binding capacity, providing paints with excellent scrub resistance and early water resistance. During this year’s Middle East Electricity show in February, Wacker also saw an increase in demand for silicone-based insulator coatings used in the energy sector.
“Because our team at Wacker Chemicals Middle East contributed to the regional development of building standards, especially in the dry mix mortars segment, we established ourselves as a market leader in the GCC long ago, and we are in a position to fully benefit from the current economic growth,” said Wacker Chemicals Middle East managing director Cyril Cisinski “We are delighted to see that recently introduced applications such as EIFS for external insulations, and products such as VAE dispersions, which support low VOC paint, generate substantial interest in the market,” he added.
In the GCC region Wacker has been focusing on high-quality and state-of-the art chemicals that are compliant with global building codes of practice and contribute to the materials’ environmental compatibility and energy-saving potentials. The company’s technologies are helping to save natural resources through enhancing energy conservation and offering various eco-friendly solutions for the construction sector.
“Our polymer dispersions and powders, for instance, are essential for energy-saving insulation systems or sealing slurries for water channels to prevent loss of fresh water. Silicone resin emulsions paints are crucial for durable and water-proof building facades, and paints and coatings modified with our polymer dispersions enable low-odour interior paints with fewer emissions,” Cisinski highlighted.
Wacker, celebrating its centenary this year, is one of the most research-intensive chemical companies in the world, spending 4 per cent of sales on R&D.
At the Middle East Coatings Show in Dubai in March, Wacker unveiled several products developed for the region including a new dispersible polymer powder for low-emission self-leveling flooring compounds (Vinnapas 4220 L), which complies with the strictest Eco label requirements such as Emicode EC1+. Another product was the polymer dispersion Vinnapas EF 3818 for low-odour and low-VOC interior paints or Vinnapas 550 ED for flexible sealing slurries.
In the Gulf, Wacker caters to diverse industries, providing silicone elastomers as insulation materials for the transmission and distribution industry, silicone-based additives and binders for coatings which protect oil and gas pipes, and cross-linkers used in plastics production. In the petrochemicals sector, the company also offers its silicone fluids (Silfoam) which control and regulate foam formation, ensuring reliable and effective production and processing of oil and gas.
“Wacker’s products are able to enhance living conditions and address important trends and needs, such as urbanisation, saving energy and resources, infrastructure, increasing mobility and personal well-being,” Cisinski emphasised.
The company has witnessed constant growth in the wider Middle East region. Between 2009 and 2013, revenues of Wacker Chemicals Middle East increased more than 50 percent, despite the impact of various embargos and turmoils that affected the region.
“Wacker views the GCC area as a high-priority geography with the potential for significant future growth. Our strategy is to grow local business by providing local expertise and technical service to our customers,” said Cisinkski.
“Its products, local application expertise, and its unique customer service are able to make substantial contributions to the further expansion of the fast developing key industries in the Near and Middle East,” he added.
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