Dow Corning and Wacker to build biggest siloxane plant

　　　Dow Corning Corporation and Wacker Chemie AG announced on Friday that they will join forces to build China's largest siloxane manufacturing facility in Zhangjiagang, East China's Jiangsu Province. Total investment for the project is estimated to exceed US$600 million in the coming years.
　　 Siloxane is a key starting material in the manufacture of silicones, widely used in the construction, chemicals, cosmetics, textiles and automotive industries. Demand for silicones has soared in China in recent years, buoyed by the nation's rapid economic development. But in January China began levying an anti-dumping tax on imported siloxane in a drive to protect domestic manufacturers. The Zhangjiagang facility will enable Dow Corning and Wacker to produce around 200,000 metric tons of siloxane and fumed silica in China every year. It is expected to be completed by the end of 2010.
　　　 Stephanie A Burns, chairman, president and CEO of Dow Corning, said the new facility will be a milestone for the company's future growth. "Thirty per cent of our sales are in Asia, especially in China. It's the strong growth of our business in China that has led us to invest in Zhangjiagang. "It is a dream come true for Dow Corning," she added. "For a number of years, we have been looking forward to building our third basic plant, somewhere in Asia, to support our growth plans in this critical market and our global supply chain." The world-class siloxane facility will be built in the Jiangsu Yangtze River Chemical Industrial Park, 　　　Zhangjiagang, a rising industrial hub one hour's drive from Shanghai. It will be Dow Corning's third siloxane base worldwide, following facilities in the United States and United Kingdom, and its capacity will exceed the total amount of siloxane produced by China's current domestic manufacturers, according to market analysts. As well as producing siloxane, the facility will also generate fumed silica, tapping into the strong demand for silicone materials in China and Asia as a whole. The facility is also Dow Corning's first joint venture with Wacker, linking two of the world's leading chemical companies for the first time. Peter-Alexander Wacker, president and CEO of Wacker, said the bond with Dow Corning offered a promising future.
"Today's groundbreaking marks a further milestone in our growth strategy for China. This joint silicone production complex will benefit both Wacker and Dow Corning with substantial economies of scale," said Wacker. Market analysts said the new facility in Jiangsu will have an important impact on China's silicone market. Liu Jun, a senior analyst with Everbright Securities' research centre, said that Dow Corning and Wacker's expansion into China will alleviate the tight silicones supply. China is expected to import around 250,000 metric tons of siloxane this year, according to a report from the centre.