Transplants: More Evidence of Processing’s Resurgence in U.S.
While reshoring continues, another trend is emerging: Global processors setting up shop in America.
It was the fall of 2013. I was attending the Global Plastics Summit in Chicago, a yearly event cosponsored by the Society of the Plastics Industry and IHS, an international “thought leader” in the area of plastics, chemicals and other industries.
The topic was shale gas, more specifically the opportunity that abundant, inexpensive feedstock materials would present to plastics processors in the U.S. Greg Jozwiak, North America commercial v.p. for Dow Packaging and Specialty Plastics, was one of the speakers that day. Looking into his crystal ball, and referring to PE packaging in particular, he said, “Core growth (due to shale gas) could boost growth by 2.5%, reshoring 1%, substitution (of non-plastics packaging) by 0.75% and export of finished goods another 0.25%. That’s 4.5% of growth, representing 770,000 metric tons/yr.” Perhaps even more intriguing to me, Jozwiak added that Dow customers outside of the U.S. were looking at establishing a manufacturing footprint in America to tap into this potential.
My first thought was “Wow.” Then I wondered, “Maybe a bit optimistic?” And as the next speaker was being introduced, I concluded my thought process with, “I guess we’ll find out.”
In late April of this year, I found out.
I was part of a group of plastics journalists from around the world invited by CORE PA Global to visit a group of companies in Pennsylvania. CORE PA is the center of a state government move to increase the visibility of a 53-county footprint to international and domestic investors and reshoring prospects.
Most of the companies we visited were long established in the region, like sheet processor Sekisui, custom molder and foam processor Ralph S. Alberts Co. Inc., rotomolder Playworld, and compounding equipment supplier Technical Process & Engineering. We also heard presentations during meal breaks from the likes of PS foam profile processor Highwood, and custom molders Viking Plastics and CJ Industries. Central Pennsylvania has been a prime location for processors for decades, so hearing about the rich histories these companies have in that region was not all that surprising.
What I found even more curious was the arrival of two new transplants to the area: Greiner Packaging Corp., an Austrian packaging powerhouse; and Fuling Plastics USA, a division of Taizhou Fuling Plastics Co. Ltd. of China that makes straws and cutlery for fast-foods. You can read the full report on these companies in the Close-Up article here.
I’m not saying the Dow executive nailed his prediction and that these companies selected central Pennsylvania to set up operations because of shale gas. That would be misleading. But certainly low energy was a factor, as was proximity to a broad customer base and easy access to transportation services. Not to mention the proximity of Pennsylvania College of Technology in Williamsport, from which Greiner has already recruited a new employee.
I think you need to look at these developments more broadly. In fact, on. p. 10 of this issue you’ll see yet another “transplant” story on the plans Raumedic of Germany has to build a $27.1 million plant in Mills River, N.C., where it will mold and extrude medical parts.
Manufacturing is returning to the U.S. In plastics, many existing operations are expanding (see On-Site article here), and we get reports of new ones coming on stream regularly. This a pretty good time to be in the business of melting pellet
Weld or knit lines are perhaps the most common and difficult injection molding defect to eliminate.
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