Domestic Investments in Fiber Capacity Expected to Increase in 2008

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Released by Industrial Info Resources (Sugar Land, Texas) -- Investments for new capacity in the United States by producers of manmade fibers have remained historically low for several years. New capacity by more than just one or two of the key players in this industry segment appears to be on the horizon with a total of over $500 million currently being tracked by Industrial Info as part of its North American Projects Database. These investments are spread across only eight individual states with the largest projects taking place in Alabama, Florida and South Carolina.

Cytec Industries Incorporated (Tempe, Arizona) and Toray Carbon Fibers America Incorporated (Decatur, Alabama) have both made investments in recent years that represented the majority of spending for this segment of the chemical processing industry (CPI). Each of these companies will remain leaders in investments for the industry segment over the next two years although at least three other producers are expected to make sizeable investments in new capacity over the next 18 months as well. Industrial Info is currently tracking projects planned by DSM (NV) (Herleen, The Netherlands), Carbon Fiber Technology LLC (Evanston, Wyoming) and Hexcel Corporation (Stamford, Connecticut) which combined equal over $120 million in major investments for new capacity. The projects planned by Carbon Fiber Technologies and Hexcel are both located in the Rocky Mountain region and include plans for the addition of new carbon fiber lines.

Despite a major consolidation in this industry segment five to eight years ago that equaled nearly two dozen plant closures, the industry still operates with nearly 60 plant locations primarily located in the Mid Atlantic and Southeast market regions employing just over 19,000 people. The health of this industry segment appears to be healthy enough that no additional plant closures have been identified and the average project total investment value (TIV) exceeds $25 million.

Although costly to initially construct, the extrusion and spinning technology employed by many of these plants is maintained by plant maintenance teams and modified only when needed to meet market demands for varying grades of products with minimal investment or use of outside resources. These facts make the opportunity of this forecast for increased spending outlook very significant as spending opportunities such as these are few and far between within this industry segment.

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