Bayer MaterialScience will set up its first integrated system house for polyurethane on the Indian subcontinent to service the local automotive, domestic appliance and footwear industries. The new facility, located near New Delhi, will go into operation at the start of 2006. Bayer officials estimate that the demand for PU in India is increasing by 10 percent annually.

Strong demand for polyurethane and the rising cost of benzene led this business unit of Bayer to raise its prices for MDI, the intermediate raw material for PU, last Sept. 1, and to follow up with price increases for thermoplastic PU last May 1. The group is already committed to raising the capacity of its existing production facilities for MDI by about 140,000 metric tons per year by 2006, building up to 940,000 tons by then, and to start up a joint 230,000-ton MDI factory together with Huntsman in China in 2008.

Bayer, Huntsman and BASF should have a joint production facility for polyurethane in place in China by 2006. Huntsman’s sales of PU in China increased by 14 percent in 2004, but they all came from its own facilities in Europe and the USA.

Both Bayer and Huntsman showed some interesting new polyurethane products at the recent SIMAC fair in Bologna. Huntsman has launched the first CAD/CAM system for foamed thermoplastic PU, which allows for flow simulation.

Bayer MaterialScience saw its sales jump by 35.5 percent to €2,544 million in the 1st quarter ended March 31, driven by higher revenues from polycarbonate, MDI and the business of J.C. Starck. Its operating profit (Ebit) roughly tripled to €406 million. Sales in Europe grew by 23.6 percent.

The unit was the best performer in the recently reorganized Bayer group, whose revenues from continuing operations grew by 15.7 percent to €6,704 million in the quarter, with a 9.7 percent increase in local currencies. The operating result from continuing operations before special items rose by 50.1 percent to €1.142 billion. Net income, which included net earnings from discontinued operations, rose by 55.6 percent to €652 million. For the full year, Bayer is aiming for an increase of over 5 percent in currency and portfolio adjusted sales from continuing operations to over €25 billion.

Meanwhile, Michael Franken has replaced the retiring Wolfgang Schwaiger as head of the leather finishing department in Lanxness’s leather business unit in Germany. Franken has been with Bayer since 1991. All the chemical activities of Bayer were combined into Lanxness at the beginign fo this year.