June 29, 2011, 12:02am


MANILA, Philippines - Chemrez Technologies Inc., the country's top biodiesel, resins and oleochemicals producer, has penetrated the US market as part of its efforts to expand the share of export revenues to 50 percent of total by 2014.

In an interview, Chemrez chief operating officer Jun A. Lao said that while their largest is now Japan and Thailand, "a very good potential for dramatic growth is the US market. It's also in US where we appointed large distributors."

He said ChemrezTech will eventually need to expand its current 90,000 metric tons a year capacity once they reach their export target of 50 percent of total revenues and may need to invest an additional $15 million on new equipment.

"Yes, we need to expand our facility. But we're usually fast in responding in terms of capacity expansion. Quite often what we do would be value-adding. We don't need a new plant, but just new equipment. We just to put up additional equipment," Lao said.

 Lao said their export products consist of oleochemicals (coconut oil-derived chemicals) as well as colorants as they hardly export any biofuels. Oleochemicals are among the raw materials used in the manufacture of soap, shampoo and other health and wellness products.

He said ChemrezTech expects a lot of growth in export sales to come from US since they have just started to sell their products there.

According to Lao the US has a sophisticated hair and body shampoo industry and which has a huge market. "And their preference for using coconut-based ingredients is also big," he added.

"Another good thing for our clients in US, a lot of them prefer quarterly contracts - which is not too much erratic and not spot-based. They're easier to deal with," Lao said.

"Fortunately, we are able to find distributors that have technical capabilities or those who can actually put in minor laboratory facilities since our products are technical in nature," Lao said.

ChemrezTech's strategy is to use products derived from a local feedstock, primarily coconut oil, as its competitive advantage.

"So we're trying to develop a lot of coconut-based products for export. We don't have too much competitors with respect to coconut-based products. We're still the main and strategic source of anything derived from coconut," Lao said.