Juan Diego Mejía Mejía, President,

Esenttia

"Esenttia is working to develop a more specialized, varied and more ecological portfolio, increasing our lines of high-impact polymers, homopolymers, copolymers and more specialized products."

Which factors have contributed to Esenttia’s performance in the last 12 months?

In spite of the challenges, Esenttia’s production rate in 2020 was remarkable and the company achieved record sales. We shifted our focus onto exports, especially during the second half of the year, while guaranteeing supply to the national market, which enabled a speedy recovery. As for the plastics and petrochemical industries, certain sectors benefited, for instance, we noticed a drastic increase in the demand for products related to food packaging, cleaning as well as hygiene. Some of our products such as fabrics for medical uniforms, masks and industrial use found their way to markets where supply was needed. We have had an excellent start to 2021, and continue on this upward trend.

What is your perspective on the current demand dynamics of the polypropylene market?

There seems to exist two worlds: the USA and Asia. For us, the USA is a fundamental part of the global dynamic since the prices of our raw materials are indexed according to the prices in the USA, and the key element is the balance of supply and demand. At the beginning of the year there were some drastic price peaks, causing a supply and demand unbalance.

How is Esenttia positioned to deal with logistical bottlenecks that have persisted throughout the pandemic?

Our location in Cartagena, which provides quick access to international markets, is a big advantage. This is supported by an expert team experienced in logistics, sales planning and operations. We are a major exporter in Latin America, consequently, we have considerable negotiation leverage. Nonetheless, we have been greatly affected by the disruption to the logistics chain. Mainly the problem is sourcing raw material feedstock, because we now manage much larger stocks, so we have added new suppliers for the European market.

Can you provide details of Esenttia’s intention to increase its presence in more specialized products, such as impact copolymers?

Esenttia is working to develop a more specialized, varied and more ecological portfolio, increasing our lines of high-impact polymers, homopolymers, copolymers and more specialized products. Polypropylene will always be our core, however, we are developing news lines, for example, of terpolymers. Our business growth strategy includes establishing a product research and development vice presidency and entering new markets such as the automotive sector in different countries.

On the other hand, single-use plastics will be facing hard times. The pandemic demonstrated that plastics have a number of advantages, which presented opportunities, but the eventual move away from single-use plastics also represents opportunities. Esenttia is working towards developing a much greener portfolio. We already offer green products, biopolymers are being added, and we are building a factory to launch recycled plastics products by the end of next year.

Can you outline Esenttia’s commitment to sustainability, including plans to build a plant to produce recycled plastic?

All the approvals to build Esenttia’s recycling plant have been obtained. The design of the plant is such that value-added products suitable to be in contact with food can be produced. Among the challenges of building a plant that uses recycled plastics as its raw material is supply. In Cartagena we have set in place a storage facility that focuses on dedicated recyclers, therefore, we combine the social aspects of the surrounding communities with the supply for our plant. Our goal is to foment the establishment of storage facilities for raw materials. The company has manufactured houses and piers made of recycled plastics and we work with vulnerable communities. It is crucial to show people that high impact things can be done with recycled plastics. What is more, we would like to start chemical recycling projects.

What is your vision for Esenttia’s expansion in the next two years?

Next year we hope to be able to achieve a 15% production expansion, as well as inaugurating operations at the recycled plastics factory. A green portfolio will be introduced that will include a wider selection of products, including masterbatches, that will allow for the usage of recyclable plastics so as to offer products with this raw material. We are working with different brands to continue to improve Esenttia’s eco friendliness. The recycled plastics sector needs to be considered as a business opportunity.