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Interview with Lawrence D. Sloan How does the specialty chemical business climate look so far this year? Overall, specialty chemical manufacturers are more optimistic than last year about the state of the industry. About 90% of SOCMA members expect to see sales rise during 2010. Many firms cite plans to at least consider investment in new capital equipment this year and at least maintain current capacity utilization over the next few years. Some are benefiting from a reverse in inventory destocking which occurred over much of 2009. According to the SOCMA Business Outlook Survey “companies are remaining positive and active in their approaches to their latest business challenges and plan to increase profits over the next three years.” Can you expand on how you think these improvements will occur? The top three approaches voiced by SOCMA members to achieving increased profitability are: (1) new product introduction; (2) process improvements that enhance operational efficiencies; and (3) broader process technologies in which companies expand the number of operations they offer their customers. Others cited reductions in sales & administrative expenses, product improvements, and growth through acquisition. You have spoken recently about the need for the “chemical industry to do more to educate the public about what they do and combat scientific illiteracy in the media.” Why is this important? Allow me to answer this question specifically in reference to TSCA modernization. SOCMA perceives there to be an underlying sentiment among consumer advocacy groups in which all chemicals, regardless of how they are manufactured, handled and used are bad. We continue to be a strong proponent of basing any changes in federal chemical management policy on the concept of RISK, which takes into consideration both the hazardous nature of a chemical PLUS the potential for exposure. To clarify, a highly toxic chemical used in a tightly controlled industrial environment or in small quantities generally means that the risk to public health is relatively small. Many of the chemicals produced by SOCMA members are intermediates which the consumer never comes into contact with, but which impart an essential characteristic to how the final formulated product performs. Even water, which may be viewed as benign, can result in human injury or even death if used improperly. What are some of the important areas of concentration for SOCMA in the upcoming months? SOCMA is focused on two key legislative issues right now, namely TSCA modernization and CFATS Reauthorization. Regarding TSCA, the House Energy & Commerce Committee has recently introduced a discussion bill and we are anticipating a companion bill out of the Senate Environment and Public Works Committee shortly. We are hopeful that both sides will engage industry in fruitful discussion. On CFATS, the critical issue is whether reauthorization will include the industry-opposed provision called “Inherently Safer Technology” (IST) which would mandate that “safer” chemicals replace existing chemicals where possible. Setting aside the arguments that IST would be a huge burden on the Department of Homeland Security to enforce, as well as the issue of it stifling product innovation, there is no general consensus among scientific experts as to what exactly IST means. There are several other issues which SOCMA is faced with, including various environmental and trade regulations, as well. To help advance our position forward on these issues, SOCMA members will be coming to Washington in June as part of SOCMA’s annual Fly-In to conduct meetings on Capitol Hill with their elected representatives. In addition to our activities on the Hill, we are expanding our portfolio of educational offerings for the industry by adding more web-based seminars to deliver content in an informational, convenient and cost-effective way to members. SOCMA recently announced its launch of a new compliance assistance webinar series intended to educate the industry on regulatory issues of importance to the chemical industry. It will feature experts from agencies such as EPA, DHS and OSHA. Our first program is scheduled for April 28th and will address the impact of greenhouse gas regulations on the specialty chemical industry. To learn more and to register, visit www.socma.com/events/index.cfm?eventCat=5&articleID=2228. Why have you decided to support the Informex Specialty Chemical event in Houston, TX? An important part of SOCMA’s value proposition to its members and the batch, custom and specialty chemical industry at large is education. In addition, SOCMA continues to maintain close ties with the INFORMEX brand name (as many know, SOCMA sold the INFORMEX Trade Show to UBM in 2005 but remains committed to helping deliver a first-rate event through its INFORMEX Committee, which serves in an advisory role to UBM). As both organizations explore ways to enhance educational offerings to the industry, we felt it was logical to team up and help promote this special event. Looking ahead, we hope to build upon the format and explore opportunities for an enhanced program. Do you see a natural crossover between SOCMA member companies and the Texan hub of industrial chemical production? Absolutely. SOCMA has 14 members alone in the greater Houston area. The region is home to dozens of specialty chemical companies which we feel could benefit from SOCMA membership. The focus of the conference – addressing the needs of the Industrial Specialty Chemical sector—is well aligned with the manufacturing interests of the area. We are pleased to see the positive reception this event has garnered to date, already surpassing our expectations. How do you think this new chemical conference will help these members? In what most are now viewing as a post-recession recovery, times remain difficult for the industry. Companies are slowly recovering in the wake of the worst year on record since the Great Depression, and demand answers to common problems. Clearly, companies are committed to operating smarter. This conference will address critical issues that will benefit functional areas across your company. As an example, purchasing departments will benefit from a session on identifying new sourcing strategies; sales & marketing teams will learn from experts who explain how to identify new markets for your products, and your operations department will learn from experts on waste minimization strategies. A mix of experts from both large and small chemical companies will enhance the educational experience. There is clearly something for everyone.
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