Chemicals Company Aims to Boost Self Sufficiency

From animal feeds to fertilizers, "green" tires to sound insulation, Evonik makes products that help make Russia less reliant on imports. Julio Vrbanic, General Manager, Evonik Chimia, spoke to Vladislav Shayman.

Evonik

Julio Vrbanic

Can you summarize the range of chemicals you produce and which ones to you make in Russia?

Evonik is one of the world-leading companies in the production of specialty chemicals. Profit growth and a continuous increase in capitalization are the main strategies of the company. About 80 per cent of our sales are in leading industry markets, and we plan to develop these markets in the future. We focus on emerging markets, developing new areas of activity through innovation and external development, and continuously improving our pricing and technological position.

The company strives to follow emerging mega trends, namely: health and nutrition, resource efficiency and globalization of technologies. It develops products so that they match customers' and companies' needs, a rather difficult task, which is best addressed by joint efforts. We are convinced that the presence of customers and joint decision-making are the keys to success.

Talking specifically about our business in Russia, I would note the construction of a plant for the production of Biolys which is a feed additive. The new plant will use the fermentation process developed by Evonik that creates amino acids. We have been recently been granted permission to start building in Volgodonsk.

All of the above created important prerequisites for the continuous development of the project. But we are also very active in other areas of the industry: for example, in paintwork materials, production of so-called "green tires", as well as in the production of road markings, special building insulation and noise insulation. Our Russian joint venture produces, for example, materials that are used for sound absorption and sound insulation. These materials were widely used in the construction of sports facilities in Sochi. For the production of lightweight structures, we develop products and technologies that are used in the automotive industry, and which will in the long term be used in aircraft.

Can you say more about the new feed plant in Volgodonsk?

Evonik has recently been granted permission to build the plant. It will strengthen the position of Evonik in the Russian market and will contribute to the effective and long-term production of pork and poultry in Russia. The plant is to be commissioned in 2016 with a capacity of about 100,000 tons per year. It will use a new fermentation technology developed by Evonik, which produces Biolys, an effective source of lysine for animal feed.

Russia is an important market for us. We see a steady increase in demand for amino acids for animal feed. With the construction of the factory we can become independent of imported meats. As a raw material we will use wheat grown in the Rostov region, which the joint venture will process. For us, it has several advantages. Firstly, we integrate in the opposite direction, and secondly, we enter deeper into the chain of building value.

Which areas of agriculture do your chemicals support?

World population growth poses the challenge of increasing agricultural food production through better use of existing acreage. Plants are the starting materials for food, and also have a use in energy production. One of the ways to increase the productivity of cultivated areas is the introduction of highly effective plant protection products. Whether for cereals, fruit or grapes: plant protection is an integral part of long-term cultivation. Evonik's product range includes innovative solutions for the agricultural industry. So it will further develop formulations for plant protection products and their optimization for long-term increase of productivity in agriculture. The efficiency of fertilizer or crop protection chemicals is significantly increased by the use of silicic acid. The new formulation reduces the number of active substances used while maintaining efficiency.

Evonik also offers granular soil that accumulates water supplies and provides a uniform supply of soil water and nutrients in dry land areas, thereby making it possible to cultivate plants in areas where there is often drought.

Biogas is produced from renewable raw materials, sludge treatment plants, liquid manure or agricultural waste as a result of microbial fermentation. First, the crude biogas consists of more than one-third carbon dioxide and other gases in small quantities. These impurities must be separated from the methane. Plastic membranes made by Evonik allow the separation of CO2 with maximum selectivity and thereby constitute a highly efficient technology for the production of biogas.

You expect Russia to become an even more important market. Can you put that in perspective compared with others?

In 2011, the launch of the project "Development Strategy for Eastern Europe", contributed to the advance of the region as a whole. It increased not only the growth of our core markets, but also opened up potential new markets.

The fact that Evonik pays special attention to this region's development plays an important role in the development of the project. Russia with all its size and dynamics of its markets is a generator for the development of this project. Although Evonik has been an active and successful business in Eastern Europe for a long time, the form of this activity is not perfect. The aim of our project is to improve it. I firmly believe that with the help of this project, we will implement our most ambitious goals. At the same time, Russia will surely play the role of locomotive in achieving these goals in Eastern Europe.

What are the advantages to Evonik of localizing production in Russia? How many plants do you have, or plan?

We have developed a general investment program up to 2020 totaling six billion euros, of which two thousand have already been invested. Also, we continuously research and develop new markets and new projects. We listen to our customers and we investigate the growth of markets in Eastern Europe. Needs that have arisen in Russia in recent years fit with our core activities, namely: mobility, oil and natural gas, as well as agriculture.

Evonik also runs the online science education program, Cyber ​​Classroom, for children around the world, as a kind of a charitable effort to encourage the teaching of science. Will this be available to Russian students?

It really is an option that we are considering at the moment. Russian schools and universities offer very high standards and Russian graduates are interested in our company. So why not support the development of potential employees from the very beginning?


Russia - Germany 2014
Russia - Germany 2014
ItТs a challenging time for German and Russian businesses, especially smaller and mid-sized companies. Some had recently localized production in Russia, making long-term commitments to the country. Large investment funds had been looking for prospects in the real estate market. Now some of these investors have put their plans on hold. ItТs a challenging time for German and Russian businesses, especially smaller and mid-sized companies. Some had recently localized production in Russia, making long-term commitments to the country. Large investment funds had been looking for prospects in the real estate market. Now some of these investors have put their plans on hold.
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