The World’s Newest Call Center Billionaire

Meet the world’s newest call center billionaire. Laurent Junique is quite the globe-trotter: He’s a French citizen, his company is based in Singapore and he just listed that company, TDCX Inc., on the New York Stock Exchange last week.

Junique, TDCX’s 55-year-old founder and CEO, also just joined the billionaire ranks: Junique’s 87% stake in the firm is now worth $3 billion, thanks to a 34% rise in TDCX shares since the IPO on October 1—an offering that raised nearly $350 million for the company.

Started in 1995 in Singapore as Teledirect, an outsourced call center that handled calls, emails and faxes for a variety of clients, the company rebranded as TDCX in 2019 to reflect its expansion into a range of services including content moderation, marketing and e-commerce support. (CX is short for “customer experience” in the customer service industry.)

TDCX reported a $64 million net profit on $323 million sales in 2020, an improvement from the $54 million profit and $242 million in revenues it recorded in 2019. That growth came in part due to greater use of the services that TDCX offers, including tools that help companies improve the performance of employees working from home. Still, TDCX is highly dependent on two clients—Facebook and Airbnb—which collectively accounted for 62% of sales in 2020.

“Our successful listing reflects the world-class company that we have built and our position as the go-to partner for transformative digital customer experience services,” Junique said in a statement on the day of the IPO. “We are grateful for the support of our clients, many of whom are global technology companies that are fuelling the growth of the digital economy.”

Junique is the second call center billionaire that Forbes has tracked. The first, Kenneth Tuchman, founded Englewood, Colorado-based TTEC Holdings (formerly called TeleTech), in 1982; at nearly $2 billion, the firm had about six times the revenues of TDCX last year. Tuchman first became a billionaire in 2007. Several Indian billionaires, including HCL Technologies cofounder Shiv Nadar and Wipro’s former chairman Azim Premji, offer call centers as some of the services their firms provide.

Junique will maintain an iron grip on TDCX as a public company, controlling all of the firm’s Class B shares, which make up more than 86% of the firm’s equity and represent 98.5% of voting power. He owns those shares through Transformative Investments Pte Ltd, a company based in the Cayman Islands that is entirely owned—according to public filings with the Securities and Exchange Commission—by a trust established for the benefit of Junique and his family. While its headquarters are in Singapore, TDCX has also been incorporated in the Cayman Islands since April 2020; prior to the IPO, the firm was controlled by Junique through a Caymans-based holding company. A spokesperson for TDCX declined to comment.

Before launching TDCX as a 29-year-old in 1995, the French native cut his teeth studying advertising at the École Supérieure de Publicité in Paris and business administration at the nearby École Supérieure Internationale d’Administration des Entreprises, graduating in 1989. After a two-year stint at consumer goods giant Unilever, Junique—who had reportedly been cooking up business ideas since he was a child, including a glass recycling proposal he came up with at age 13—decided he wanted a more international career, but struggled to find a gig as a young graduate with little experience.

Armed with a suitcase and just enough cash to get by, he decamped to Singapore in 1995 to try his luck on the other side of the planet. Singapore offered a strategic location as a modern, English-speaking city at the heart of fast-growing Southeast Asia, and Junique started a call center called Teledirect aimed at businesses looking to cut costs and outsource customer service. Soon enough, Junique scored the firm’s first big client, an American credit card firm based in Singapore.

Two years later, in 1997, Junique sold a 40% stake in Teledirect to London-based advertising giant WPP for an undisclosed amount. Since then, TDCX expanded beyond call centers and now has offices in 11 countries across three continents, including locations in China, Japan and India. In 2018, Junique bought back WPP’s 40% stake in the call center business for about $28 million. Three years of growth later, the company now has a market capitalization of $3.5 billion.

With 2020 marking a record year for TDCX, Junique is hoping that the Covid-induced transition away from offices has made the firm’s products more necessary for its clients. “As consumers live more and more of their lives online, the expectation for things to be done simply, conveniently and on-demand will only increase,” Junique said in a statement.

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Source: The World’s Newest Call Center Billionaire

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Related Contents:

“BBC Three – The Call Centre, Series 1”. Bbc.co.uk. 2013-12-10. Retrieved 2017-12-10.

Maritime Rope May Be a Large Source of Microplastics Pollution

We’ve been hearing a lot lately about how disintegrated waterborne trash is one of the main sources of ocean microplastics pollution. A new study, however, suggests that aging maritime rope could also be making a significant contribution.

Ocean microplastics are tiny particles or fibers of plastic that are suspended in the water, where they get consumed by fish. When those fish are eaten by humans or other animals, the microplastics get passed along into their bodies, potentially causing health problems.

Previous studies have determined that a great deal of microplastics come from plastic packaging and other garbage, which gradually deteriorates after being dumped in or washed into the sea. Other sources include synthetic textile fibers that enter the wastewater stream from washing machines, and even particles of automobile tire rubber that get washed off the roads and down into storm sewers.

All of that being said, scientists from Britain’s University of Plymouth wondered if the polymer ropes used for hauling in fishing nets might also be to blame.

In both lab-based simulations and field experiments, it was initially determined that one-year-old ropes release about 20 microplastic fragments into the ocean for every meter (3.3 ft) hauled. That figure rose to 720 fragments per meter for two-year-old ropes, and over 760 for 10-year-old ropes.

With those figures in mind, it was estimated that a 50-m (164-ft) length of new rope likely releases between 700 and 2,000 microplastic fragments each time it’s hauled in. For older ropes, the number could be as high as 40,000 fragments. It was further estimated that the UK fishing fleet – which includes over 4,500 vessels – may be releasing anywhere from 326 million to 17 billion rope microplastic fragments annually.

“These estimates were calculated after hauling a 2.5-kg [5.5-lb] weight,” says the lead scientist, Dr. Imogen Napper. “However, most maritime activities would be hauling much heavier loads, creating more friction and potentially more fragments. It highlights the pressing need for standards on rope maintenance, replacement and recycling in the maritime industry. However, it also shows the importance of continued innovation in synthetic rope design with the specific aim to reduce microplastic emissions.”

The research is described in a paper that was recently published in the journal Science of the Total Environment.

Source: Maritime rope may be a large source of microplastics pollution

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Chemical Society, American. “Plastics in Oceans Decompose, Release Hazardous Chemicals, Surprising New Study Says”. Science Daily. Science Daily. Retrieved 15 March 2015.

Chalabi, Mona (9 November 2019). “Coca-Cola is world’s biggest plastics polluter – again”. The Guardian. ISSN 0261-3077. Retrieved 18 November 2019.

“Global Brand Audit Report 2019”. Break Free From Plastic. Retrieved 18 November 2019.

McVeigh, Karen (7 December 2020). “Coca-Cola, Pepsi and Nestlé named top plastic polluters for third year in a row”. The Guardian. Retrieved 20 December 2020.

“Top 20 Countries Ranked by Mass of Mismanaged Plastic Waste”. Earth Day.org. 4 June 2018.

Kushboo Sheth (18 September 2019). “Countries Putting The Most Plastic Waste Into The Oceans”. worldatlas.com.

National Geographic, 30 Oct. 2020, “U.S. Generates More Plastic Trash than Any Other Nation, Report Finds: The Plastic Pollution Crisis Has Been Widely Blamed on a Handful of Asian Countries, But New Research Shows Just How Much the U.S. Contributes”

Science Advances, 30 Oct. 2020 “The United States’ Contribution of Plastic Waste to Land and Ocean” vol. 6, no. 44

EcoWatch, 18 Mar. 2021 “U.S. Continues to Ship Illegal Plastic Waste to Developing Countries”

Lebreton, Laurent; Andrady, Anthony (2019). “Future scenarios of global plastic waste generation and disposal”. Palgrave Communications. Nature. 5 (1). doi:10.1057/s41599-018-0212-7. ISSN 2055-1045. Lebreton2019. the Asian continent was in 2015 the leading generating region of plastic waste with 82 Mt, followed by Europe (31 Mt) and Northern America (29 Mt). Latin America (including the Caribbean) and Africa each produced 19 Mt of plastic waste while Oceania generated about 0.9 Mt.

“Plastic Oceans”. futureagenda.org. London.

Cheryl Santa Maria (8 November 2017). “STUDY: 95% of plastic in the sea comes from 10 rivers”. The Weather Network.

Duncan Hooper; Rafael Cereceda (20 April 2018). “What plastic objects cause the most waste in the sea?”. Euronews.

Christian Schmidt; Tobias Krauth; Stephan Wagner (11 October 2017). “Export of Plastic Debris by Rivers into the Sea” (PDF). Environmental Science & Technology. 51 (21): 12246–53. Bibcode:2017EnST…5112246S. doi:10.1021/acs.est.7b02368. PMID 29019247. The 10 top-ranked rivers transport 88–95% of the global load into the sea

Harald Franzen (30 November 2017). “Almost all plastic in the ocean comes from just 10 rivers”. Deutsche Welle. Retrieved 18 December 2018. It turns out that about 90 percent of all the plastic that reaches the world’s oceans gets flushed through just 10 rivers: The Yangtze, the Indus, Yellow River, Hai River, the Nile, the Ganges, Pearl River, Amur River, the Niger, and the Mekong (in that order).

Daphne Ewing-Chow (20 September 2019). “Caribbean Islands Are The Biggest Plastic Polluters Per Capita In The World”. Forbes.

“Sweeping New Report on Global Environmental Impact of Plastics Reveals Severe Damage to Climate”. Center for International Environmental Law (CIEL). Retrieved 16 May 2019.

Plastic & Climate: The Hidden Costs of a Plastic Planet (PDF). May 2019. Retrieved 28 May 2019.

“An underestimated threat: Land-based pollution with microplastics”. sciencedaily.com. 5 February 2018. Retrieved 19 July 2019.

“Plastic planet: How tiny plastic particles are polluting our soil”. unenvironment.org. 3 April 2019. Retrieved 19 July 2019.

“Mismanaged plastic waste”. Our World in Data. 2010. Retrieved 19 July 2019.

McCarthy, Niall. “The Countries Polluting The Oceans The Most”. statista.com. Retrieved 19 July 2019.

Aggarwal,Poonam; (et al.) Interactive Environmental Education Book VIII. Pitambar Publishing. p. 86. ISBN 8120913736

“Invisibles”. orbmedia.org. Retrieved 15 September 2017.

“Synthetic Polymer Contamination in Global Drinking Water”. orbmedia.org. Retrieved 19 September 2017.

“Your tap water may contain plastic, researchers warn (Update)”. Retrieved 15 September 2017.

editor, Damian Carrington Environment (5 September 2017). “Plastic fibres found in tap water around the world, study reveals”. The Guardian. ISSN 0261-3077. Retrieved 15 September 2017.

Lui, Kevin. “Plastic Fibers Are Found in ‘83% of the World’s Tap Water. Time. Retrieved 15 September 2017.

“Development solutions: Building a better ocean”. European Investment Bank. Retrieved 19 August 2020.

Weisman, Alan (2007). The World Without Us. St. Martin’s Thomas Dunne Books. ISBN 978-0-312-34729-1.

Jang, Y. C., Lee, J., Hong, S., Choi, H. W., Shim, W. J., & Hong, S. Y. 2015. Estimating the global inflow and stock of plastic marine debris using material flow analysis: a preliminary approach. Journal of the Korean Society for Marine Environment and Energy, 18(4), 263–273.[2]

Wright, Pam (6 June 2017). “UN Ocean Conference: Plastics Dumped In Oceans Could Outweigh Fish by 2050, Secretary-General Says”. The Weather Channel. Retrieved 5 May 2018.

Ostle, Clare; Thompson, Richard C.; Broughton, Derek; Gregory, Lance; Wootton, Marianne; Johns, David G. (2019). “The rise in ocean plastics evidenced from a 60-year time series”. Nature Communications. 10 (1): 1622. Bibcode:2019NatCo..10.1622O. doi:10.1038/s41467-019-09506-1. ISSN 2041-1723. PMC 6467903. PMID 30992426.

“Research |AMRF/ORV Alguita Research Projects” Archived 13 March 2017 at the Wayback Machine Algalita Marine Research Foundation. Macdonald Design. Retrieved 19 May 2009 UNEP (2005) Marine Litter: An Analytical Overview

Organic Based EV Battery Turns To Ethanol For a Boost In Energy Density

While on the face of it, the lithium-batteries that power electric vehicles play an important role in our ongoing shift to sustainable transport, they aren’t without environmental problems of their own. Batteries that use organic, readily available materials in place of rare metals are seen as a promising part of the solution to this dilemma, and new research led by University of Houston scientists demonstrates how the performance of these eco-friendly devices might be brought up to speed.

As demand for electronic devices and vehicles continues to grow, so does the reliance on lithium-ion batteries that rely on scarce metals. Front and center of this dilemma is cobalt, the mining of which is not only associated with environmental degradation and pollution of water supplies, but plagued by ethical issues such as the exploitation of child labor. The use of these metals also makes recycling the batteries difficult at the end of their lives.

However, we are seeing some exciting advances being made in the development of batteries that do away with these types of materials and use organic ones instead. These have included organic-based batteries that can break down in acid for recycling, a heavier reliance on cheaper and more environmentally friendly nickel, and even one from IBM that uses materials found in seawater.

The new device marries this organic architecture with another promising branch of battery research focusing on the use of solid-state electrolytes. Typical batteries move their electrical charge between two electrodes, a cathode and anode, in a liquid electrolyte solution, but scientists are making great inroads into alternative designs that use a solid electrolyte instead. This type of architecture could also allow batteries to work with a lithium metal anode, which could store as much as 10 times the energy of current devices.

The scientists behind the new battery have solved what they say is a key limitation of organic-based, solid-state lithium batteries. Where cobalt-based cathodes afford these batteries a high energy density, ones made from organic materials suffer from limited energy density, which the team found to be because of microscopic structures within the cathode. “Cobalt-based cathodes are often favored because the microstructure is naturally ideal but forming the ideal microstructure in an organic-based solid-state battery is more challenging,” says study author Jibo Zhang.

Working with a cathode made from an organic material called pyrene-4,5,9,10-tetraone (PTO), the scientists used ethanol as a solvent to alter its microstructure. This treatment resulted in a new arrangement that allowed for better transport of ions within the cathode and boosted its energy density to 302 Wh/kg, which the team says is 83 percent higher than current state-of-the-art solid-state batteries with organic cathodes.

“We are developing low-cost, earth-abundant, cobalt-free organic-based cathode materials for a solid-state battery that will no longer require scarce transition metals found in mines,” says Yao. “This research is a step forward in increasing EV battery energy density using this more sustainable alternative.”

Nick Lavars

 

By: Nick Lavars

 

Source: Organic-based EV battery turns to ethanol for a boost in energy density

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Millions of Electric Cars are Coming What Happens To All The Dead Batteries

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The battery pack of a Tesla Model S is a feat of intricate engineering. Thousands of cylindrical cells with components sourced from around the world transform lithium and electrons into enough energy to propel the car hundreds of kilometers, again and again, without tailpipe emissions. But when the battery comes to the end of its life, its green benefits fade.

If it ends up in a landfill, its cells can release problematic toxins, including heavy metals. And recycling the battery can be a hazardous business, warns materials scientist Dana Thompson of the University of Leicester. Cut too deep into a Tesla cell, or in the wrong place, and it can short-circuit, combust, and release toxic fume.

That’s just one of the many problems confronting researchers, including Thompson, who are trying to tackle an emerging problem: how to recycle the millions of electric vehicle (EV) batteries that manufacturers expect to produce over the next few decades. Current EV batteries “are really not designed to be recycled,” says Thompson, a research fellow at the Faraday Institution, a research center focused on battery issues in the United Kingdom.

That wasn’t much of a problem when EVs were rare. But now the technology is taking off. Several carmakers have said they plan to phase out combustion engines within a few decades, and industry analysts predict at least 145 million EVs will be on the road by 2030, up from just 11 million last year. “People are starting to realize this is an issue,” Thompson says.

Governments are inching toward requiring some level of recycling. In 2018, China imposed new rules aimed at promoting the reuse of EV battery components. The European Union is expected to finalize its first requirements this year. In the United States, the federal government has yet to advance recycling mandates, but several states, including California—the nation’s largest car market—are exploring setting their own rules.

Complying won’t be easy. Batteries differ widely in chemistry and construction, which makes it difficult to create efficient recycling systems. And the cells are often held together with tough glues that make them difficult to take apart. That has contributed to an economic obstacle: It’s often cheaper for batterymakers to buy freshly mined metals than to use recycled materials.

Better recycling methods would not only prevent pollution, researchers note, but also help governments boost their economic and national security by increasing supplies of key battery metals that are controlled by one or a few nations. “On the one side, [disposing of EV batteries] is a waste management problem. And on the other side, it’s an opportunity for producing a sustainable secondary stream of critical materials,” says Gavin Harper, a University of Birmingham researcher who studies EV policy issues.

To jump-start recycling, governments and industry are putting money into an array of research initiatives. The U.S. Department of Energy (DOE) has pumped some $15 million into a ReCell Center to coordinate studies by scientists in academia, industry, and at government laboratories. The United Kingdom has backed the ReLiB project, a multi-institution effort. As the EV industry ramps up, the need for progress is becoming urgent, says Linda Gaines, who works on battery recycling at DOE’s Argonne National Laboratory. “The sooner we can get everything moving,” she says, “the better.

Now, recyclers primarily target metals in the cathode, such as cobalt and nickel, that fetch high prices. (Lithium and graphite are too cheap for recycling to be economical.) But because of the small quantities, the metals are like needles in a haystack: hard to find and recover.

To extract those needles, recyclers rely on two techniques, known as pyrometallurgy and hydrometallurgy. The more common is pyrometallurgy, in which recyclers first mechanically shred the cell and then burn it, leaving a charred mass of plastic, metals, and glues. At that point, they can use several methods to extract the metals, including further burning. “Pyromet is essentially treating the battery as if it were an ore” straight from a mine, Gaines says. Hydrometallurgy, in contrast, involves dunking battery materials in pools of acid, producing a metal-laden soup. Sometimes the two methods are combined.

Each has advantages and downsides. Pyrometallurgy, for example, doesn’t require the recycler to know the battery’s design or composition, or even whether it is completely discharged, in order to move ahead safely. But it is energy intensive. Hydrometallurgy can extract materials not easily obtained through burning, but it can involve chemicals that pose health risks.

And recovering the desired elements from the chemical soup can be difficult, although researchers are experimenting with compounds that promise to dissolve certain battery metals but leave others in a solid form, making them easier to recover. For example, Thompson has identified one candidate, a mixture of acids and bases called a deep eutectic solvent, that dissolves everything but nickel.

Both processes produce extensive waste and emit greenhouse gases, studies have found. And the business model can be shaky: Most operations depend on selling recovered cobalt to stay in business, but batterymakers are trying to shift away from that relatively expensive metal. If that happens, recyclers could be left trying to sell piles of “dirt,” says materials scientist Rebecca Ciez of Purdue University.

The ideal is direct recycling, which would keep the cathode mixture intact. That’s attractive to batterymakers because recycled cathodes wouldn’t require heavy processing, Gaines notes (although manufacturers might still have to revitalize cathodes by adding small amounts of lithium). “So if you’re thinking circular economy, [direct recycling] is a smaller circle than pyromet or hydromet.”

In direct recycling, workers would first vacuum away the electrolyte and shred battery cells. Then, they would remove binders with heat or solvents, and use a flotation technique to separate anode and cathode materials. At this point, the cathode material resembles baby powder.

So far, direct recycling experiments have only focused on single cells and yielded just tens of grams of cathode powders. But researchers at the U.S. National Renewable Energy Laboratory have built economic models showing the technique could, if scaled up under the right conditions, be viable in the future.

To realize direct recycling, however, batterymakers, recyclers, and researchers need to sort out a host of issues. One is making sure manufacturers label their batteries, so recyclers know what kind of cell they are dealing with—and whether the cathode metals have any value. Given the rapidly changing battery market, Gaines notes, cathodes manufactured today might not be able to find a future buyer. Recyclers would be “recovering a dinosaur. No one will want the product.”

Another challenge is efficiently cracking open EV batteries. Nissan’s rectangular Leaf battery module can take 2 hours to dismantle. Tesla’s cells are unique not only for their cylindrical shape, but also for the almost indestructible polyurethane cement that holds them together.

Engineers might be able to build robots that could speed battery disassembly, but sticky issues remain even after you get inside the cell, researchers note. That’s because more glues are used to hold the anodes, cathodes, and other components in place. One solvent that recyclers use to dissolve cathode binders is so toxic that the European Union has introduced restrictions on its use, and the U.S. Environmental Protection Agency determined last year that it poses an “unreasonable risk” to workers.“In terms of economics, you’ve got to disassemble … [and] if you want to disassemble, then you’ve got to get rid of glues,” says Andrew Abbott, a chemist at the University of Leicester and Thompson’s adviser.

To ease the process, Thompson and other researchers are urging EV- and batterymakers to start designing their products with recycling in mind. The ideal battery, Abbott says, would be like a Christmas cracker, a U.K. holiday gift that pops open when the recipient pulls at each end, revealing candy or a message. As an example, he points to the Blade Battery, a lithium ferrophosphate battery released last year by BYD, a Chinese EV-maker. Its pack does away with the module component, instead storing flat cells directly inside. The cells can be removed easily by hand, without fighting with wires and glues.

The Blade Battery emerged after China in 2018 began to make EV manufacturers responsible for ensuring batteries are recycled. The country now recycles more lithium-ion batteries than the rest of the world combined, using mostly pyro- and hydrometallurgical methods.

Nations moving to adopt similar policies face some thorny questions. One, Thompson says, is who should bear primary responsibility for making recycling happen. “Is it my responsibility because I bought [an EV] or is it the manufacturer’s responsibility because they made it and they’re selling it?” In the European Union, one answer could come later this year, when officials release the continent’s first rule. And next year a panel of experts created by the state of California is expected to weigh in with recommendations that could have a big influence over any U.S. policy.

Recycling researchers, meanwhile, say effective battery recycling will require more than just technological advances. The high cost of transporting combustible items long distances or across borders can discourage recycling. As a result, placing recycling centers in the right places could have a “massive impact,” Harper says. “But there’s going to be a real challenge in systems integration and bringing all these different bits of research together.”

There’s little time to waste, Abbott says. “What you don’t want is 10 years’ worth of production of a cell that is absolutely impossible to pull apart,” he says. “It’s not happening yet—but people are shouting and worried it will happen.

By Ian Morse

Source: Millions of electric cars are coming. What happens to all the dead batteries? | Science | AAAS

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References

Best, Paul (19 November 2020). “GM doubles down on commitment to electric vehicles, increases spending to $27B”. FOXBusiness. Retrieved 20 November 2020.

With Russia’s Help, China Becomes Plastics Making Power In Pandemic

After giving up on recycling — American recycling that is — China is still in love with the plastics biz. In fact. their companies are becoming dominant in all things plastic, one of the most important supply chains in the world.

In other words, it will be yet another segment in global business that the world will need Chinese companies to get supply.

The pandemic has helped the petrochemicals industry make up for losses in oil and gas demand. Plastics are tied to the fossil fuels industry. Stay-at-home orders throughout the U.S. and Europe has led to more take-out food orders and a lot of that is being placed in plastic containers.

I’d like to highlight one thing though: China’s Sinopec is the behemoth in this space, and although you can buy into Sinopec on the U.S. stock market, if the incoming Biden Administration makes good on a Trump order to delist Chinese companies that are not compliant with the financial audit rules under the Sarbanes-Oxley Act of 2002, then Sinopec will probably leave the NYSE.

According to industry consultant Wood Mackenzie, petrochemicals will account for more than a third of global oil demand growth to 2030 and nearly half through 2050.

The growth in both plastics consumption and production is mostly coming from Asia where economies are catching up with the western levels of plastics consumption, and becoming a source for plastics exports to the U.S. and Europe.

Within Asia of course, China is the powerhouse. Last year Exxon Mobil XOM -4.8% began constructing its $10 billion petrochemical complex in Huizhou, China.

Russia Joins China, Wants To Be ‘Indispensible’

Russia’s petrochemical giant Sibur is also locked into China, mainly through a Sinopec partnership. The two companies began work on one of the world’s largest polymer plants for plastics making last August, spending $11 billion on the Amur Gas Chemical Complex in Russia.

The two sides are intimately connected in the global plastics biz.

“Amur is a milestone in the cooperation between Sinopec and Sibur,” Zhang Yuzhuo, chairman of Sinopec, says in a press statement, calling it a “model for Sino-Russian energy cooperation.”

The entire industry, while not exactly the sexy and green industry the Davos crowd is promoting heavily in the Western world, is seen by China and still-emerging markets like Russia — as a development tool for regions far away from the big city hubs of Moscow or Shanghai. This is as much about job creation as it is pumping out plastic molds and the ethylene needed to make it.

Russia recently introduced negative excise tax on LPG and ethane used in petrochemicals which was a meaty financial bone thrown to Sinopec and Sibur’s Amur project, among others in the Russian far east. 

The Sibur Russia angle has gained momentum recently due to the ramp up in production from the new ZapSib Siberian facility last year. They make polyethylene and 500 thousand tons of polypropylene there; all must-have ingredients for plastics manufacturers.

Their relationship with Chinese investors, buyers and counterparties was one of the main reasons to even build that manufacturing plant in the first place, and is something the Moscow market likes to give as one of the best reasons to be bullish about a rumored initial public offering for Sibur.

Sibur has said in press statements that they expect “another jump in scale” of plastics chemicals output with the addition of the Sinopec project, Amur.

“Sibur has long built relationships with Chinese clients, partners, and investors and Sinopec has been our strategic partner since 2013,” says Dmitry Konov, Chairman of the Management Board for Sibur. Konov told Reuters recently that there was no timeline for any IPO in the Moscow Exchange. Moscow was home to one of the top four largest IPOs last year, shipping firm Sovcomflot.

Konov said their logistical advantages in the far east, near China, and competitive pricing for its polymers means they will “scale up these relationships to further expand the delivery of high-quality petrochemicals from Siberia to China.”

VTB Capital, a Russian investment bank, says those projects would allow Russia to become one of the world’s top four producers of ethylene by 2030. Russia wants to position itself as the indispensable partner to China in this space, much in the way that China has positioned itself as the key source for numerous key inputs, whether its cobalt used in electric vehicle car batteries, or solar panels now expected to criss-cross the U.S. in the Biden Administration.

Due to the pandemic, China has been focused on industries of the future alongside those needed to get itself, and its trading partners, out of the pandemic rut — those polypropylene Olive Garden to go containers might not come from China, but the plastics that made it sure might.

China remains the place for growth in this space, too. Plastics-use patterns and penetration are rising. Figure the Asians are a good 10 to 20 years behind the U.S. in terms of plastics use. They’re gaining fast.

China As Plastics Demand Driver

Plastics aren’t made from tree bark, that’s for sure. It comes from fossil fuels and non-organic chemical compounds that make the stuff designed to last hundreds of years.

And China now accounts for roughly 40% of the demand for the chemicals used in making it, an increase of just 20% in 2005. 

China’s ethylene demand grew by 8.6% between 2014-17 while global demand grew by only half that. 

Looking out five years, Deutsche Bank industry analysts said in a November 25 report that China will account for over half of global consumption growth for ethylene (to which Sibur and Russia are happy as their go-to for now). 

China has 50% self-sufficiency in ethylene and derivative products – the domestic desire to expand capacities and increase self-sufficiency remains high. Russia is a solution. But Sinopec will invest domestically, as will the big Western multinationals who are frowned upon doing similar work back home. Exxon is case in point.

China was a relatively late entrant to the global petrochemical industry, but that does not mean much. They ramp up, and rev up fast due to state subsidies and state-owned companies’ ability to obtain raw materials and pass them along downstream for pennies on the dollar. These are loss leaders, but China doesn’t care about that stuff. They are looking to produce plastics for the locals, and for the export markets, especially U.S. and Europe, which are increasingly disinterested in anything fossil fuels related, at least on paper. 

In the 1990s, the Chinese petrochemical industry was significantly smaller than the U.S. In 1995, China’s ethylene capacity totaled 3% of global capacity. In comparison, Japan had 9% of global ethylene capacity and Korea had 5% of global capacity. Ethylene is naturally occurring.

During the 2000s, China’s petrochemical industry grew substantially driven by government support and strong demand from government-directed infrastructure spending, a burgeoning middle class with rising disposable incomes, expanding residential construction and exports of course.

Between 2004 and 2012, China’s ethylene capacity — the flammable gas used to make ethanol for cars, fruit ripeners, and — more importantly, plastics — doubled to 11 million tons per year. Within 25 years, China’s capacity has moved from 3% of global to 16% of global. Who thinks they’re going to slow that down? Need plastic? China will have it. For now, Russia has the chemicals. China might just gain on that next. Follow me on Twitter or LinkedIn

Kenneth Rapoza

Kenneth Rapoza

I’ve spent 20 years as a reporter for the best in the business, including as a Brazil-based staffer for WSJ. Since 2011, I focus on business and investing in the big emerging markets exclusively for Forbes. My work has appeared in The Boston Globe, The Nation, Salon and USA Today. Occasional BBC guest. Former holder of the FINRA Series 7 and 66. Doesn’t follow the herd.

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Business Casual

📚 Get your free copy of “Poorly Made in China” from Audible, in addition to a free 30-day trial! → https://amzn.to/3dkzN9T (Note: As an Amazon Associate, we earn from qualifying purchases). China has been the leader of the recycling industry for over 30 years, importing materials more than any country in the world and making billions of dollars in the process. But recently, the Chinese government took a tougher stance on recycling, effectively disrupting the global recycling industry. More importantly, China’s decision has caused major problems for many Western countries, since they were the ones exporting millions of tons of recyclable waste to China. ⭑

Subscribe to Business Casual → http://gobc.tv/sub ⭑ Enjoyed the vid? Hit the like button! 📚 If you enjoyed this video about #China and want to learn even more, we also recommend you read the book “Junkyard Planet: Travels in the Billion-Dollar Trash Trade Kindle” by Adam Minter 👉 https://amzn.to/2M4wY0z (note: as an Amazon Associate, we earn from qualifying purchases). Your support makes our content possible! ❤️ Follow us on: ► Twitter → http://gobc.tv/twtr ► Instagram → https://gobc.tv/ig ► Facebook → http://gobc.tv/fb ► LinkedIn → https://gobc.tv/linkedin ► Reddit → https://gobc.tv/reddit ► Medium → https://gobc.tv/medium ⬇️Exclusive Sponsor Offers (Only For BC Fans) ⬇️ ✪ Sign-up for Acorns! 👉 https://gobc.tv/acorns ✪ Skillshare (get 2 months free) 👉http://gobc.tv/skillshare ✪ Try DollarShaveClub (just $5!) 👉http://dollarshaveclub.com/bc ✪ Try Blinkist free for 7 days! 👉https://gobc.tv/readblinkist

Amazon’s New Eco-Friendly Boxes Can Be Turned Into Forts and Cat Condos

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An Amazon delivery might not be that exciting for you, but your cat is probably thrilled to be getting a new cardboard home. Amazon has made that sentiment official with new eco-friendly boxes that can be recycled into cat condos, forts and even a putt-putt golf windmill. It’s all part of the company’s “less packaging, more smiles” program aimed at reducing cardboard consumption.

Amazon noted that over the years, it has reduced packaging weight by 33 percent, eliminating the equivalent of about 1.5 billion boxes and reducing its carbon footprint. “Inventing and innovating in new types of packaging is one of the many actions we are taking as part of the climate pledge — our commitment to become net-zero carbon by 2040 — 10 years ahead of the Paris Agreement,” Amazon VP Kim Houchens told USA Today.

Related: Jeff Bezos Is Now Personally Worth More Than Nike, McDonald’s, Costco and Almost 50 Percent of the Dow

Despite the efforts, Amazon still shipped about 5 billion packages in 2018 out of 165 billion shipped in total in the US. Even though 92 percent of cardboard boxes are recycled, that’s still a lot of waste and forest destruction.

Related: Want to Rank Higher in Google and Amazon Search? This $29 Course Can Help.

Only certain orders will be delivered in the more environmentally friendly boxes, starting this week. If you get one, you can create your own Chateau Fluffy by scanning a QR code or heading to Amazon.com/ThisBox for detailed instructions.

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