Röhm interview regarding the European MMA and Base Monomer production and supply during winter 2022/2023 and thereafter

How do you see Röhm’s position as a European producer during this crisis induced by the Ukraine war in February 2022?

Röhm and the whole industry are facing very tough times regarding the competitiveness of the European Chemical industry. Numerous reports, papers and discussions are addressing this point from every angle. As participants at the 2022 EPCA and member of the CEFIC, we are fully aware of the burden in the industry, the markets and our customers are facing after the Ukraine war due to the strong dependency of single sourcing of Russian pipeline gas.

We are the largest MMA producer in Europe with two complementary production sites with the claim to serve the merchant MMA market reliably, sustainably, and with the commitment “Made in Europe”. Europe has turned into an import region for a lot of petrochemical products and for MMA, however, we believe in a strong European value chain and domestically produced Monomers are part of this value chain for PMMA, coatings resins and many other applications. As a European founded company, we stand by our commitments.

How do you see Röhm positioned in the global Methacrylates market?

As Röhm, we believe in the strength of the Methacrylates market and recovery of the industry after 2HY 2022 weakness in demand across the regions. As a company, we have adjusted production rates to the lower demand and observed destocking pressure in the recent months. We are the only remaining MMA producer with our own production in all three main regions, North America, Europe, and Asia. Despite the crisis, Röhm continues its strategic investment into a new world-scale MMA production in Bay City utilizing its own C2-based LiMA technology. After the ground breaking in October this year, engineering and construction continues full speed and we are confident to start production in 2024. Roehm is not only investing in new MMA capacity, but also continues its investment in existing assets and pushes forward strategic investments in the downstream business. Röhm strives to be the Leader in Methacrylates and a strategic partner for our valuable customers.

Is sustainability seen by Röhm as a future key differentiator?

Yes, Röhm has initiated its “Track 2030” program to reduce its global carbon footprint by 30% per ton by 2030 compared to 2020. By the year 2050, Röhm wants to not generate any more greenhouse gas emissions and therefore produce climate-neutral. The initiative, sponsored by our COO Hans-Peter Hauck, is not only addressing the reduction of the Scope 3 Product Carbon Footprint (PCF), but also aspects of circular economy, energy and water management as well as Chemical Safety. Its noteworthy to mention, that Röhm has optimized over the past decades already the efficiency and energy yield of our productions and we believe the European MMA and monomer production currently has the lowest PCF globally. Aside from the lower PCF for European produced MMA, the customer proximity of a domestic producer contributes to sustainability. Röhm internal assessment indicates a 25-35% lower PCF for European MMA production at certified value of 3,47 kgCO2eq/kgMMA compared to MTBE based the alternative route, primarily used in Asia. The LiMA technology will further improve our carbon footprint substantially towards our Track 2030 target.

Security of supply is of high importance for every customer. What is your response?

Certainly, on-time in full is crucial for our customers to plan their production and Röhm has the clear target of a flawless supply. We have seen in the recent months and year numerous supply chain disruptions, especially for intercontinental sea shipments. Transport routes from other regions usually take 8 to 10 weeks with the high uncertainty of disruptions. We all remember the backlog caused by the blockage of the Suez Channel in March 2021 and the strict COVID-19 harbor lock-downs for example in China. Also, extreme weather conditions contribute to the uncertainty in long supply chains. As Röhm, we produce domestically for our customers and we are proud to reach the majority of our customer sites within a few days, if well planned and required, in emergencies we do everything that the product reaches our customers as quickly as possible. In Europe, as a market with a highly integrated supply chain, Röhm wants to play its role as reliable supplier.

How do you see the competitiveness of a European Methacylates producer?

As at the beginning stated, there is no doubt that European production has quite some challenges to overcome in the next months, also strongly dependent on natural gas availability and cost. The winter 2022/2023 will probably be the toughest, not only for Röhm, but for a lot of energy intensive chemical producers. Our highly efficient production supports our competitiveness, but we are facing escalated and highly volatile production costs. As Röhm, we observe the enormous cost pressure of our customers along the value chain, and announced a price adjustment in December, taking the risk of an uncertain cost development. Mid-term, we trust in the competitiveness of the European Chemical industry, as we already see the first LNG terminal in Germany will start service soon with more terminals to come. Renewable energy well gains further competitiveness, required for the sustainability transformation of our industry. Röhm is willing to invest in our future as much as we trust our suppliers and customers to take a similar approach.