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Dow Announces Start-up of Converted Epoxy Resin Plant in China

11 May 2003

Dow’s 41,000 metric tons per annum converted epoxy resin plant at the Dow Zhangjiagang site in the People's Republic of China has started up on schedule and with the first production within specification.

The plant will produce solid epoxy resin used primarily to produce powder coatings; solid solution epoxy resin for marine and protective liquid paints; and brominated epoxy resin for the production of electrical laminates.

""All these applications have experienced double-digit growth in China,"" said Phil Cook, business vice president for Epoxy Products and Intermediates (EP&I). ""This is due to both the buoyant domestic market and the migration of many applications to China for local use and export to the world. Our epoxy resin plant in Zhangjiagang expands our global presence and demonstrates our commitment to the growing epoxy industry in China and the broader Asia Pacific region.""

The new plant will supply resins to Greater China, ASEAN and Australasia. ""It joins our epoxy facilities in Kumi, Korea (30,000 metric tons per annum) and Kinu Ura, Japan (40,000 metric tons per annum) to provide a superior network of epoxy resin facilities in the largest global concentration of demand,"" said Graham Daley, EP&I Commercial Director, Pacific.

Chinese Epoxy Market Expanding

""Epoxy resins are very important raw materials for many high value, downstream industries, including electronics, marine, automotive and appliances,"" said Daley. ""With Dow's efforts over the years to build up strong sales throughout the Asia Pacific region, this new Zhangjiagang facility will quickly approach full capacity utilization. The new Zhangjiagang plant will effectively meet the demand for high quality epoxy products in this region and will generally replace products currently being imported from Dow facilities elsewhere in the world. As product becomes commercially available in the May/June timeframe, the plant's high operating rates will boost efficiency.""

Daley said that the electronics industries have been gravitating to China and the pace actually quickened during the global electronic downturn during the past two years. During 2002, personal computer and mobile phone purchases in China were phenomenal. He added that China is by far the largest manufacturer of shipping containers and significant large tonnage vessel construction takes place in Northern China. The appliance industry in China is also very large and automobile production is soaring.

The epoxy resin markets of China are concentrated around Shanghai in Eastern China and Guangzhou in Southern China. The Zhangjiagang site, located along the Yangtze River near Shanghai, is central to these locations and is ideally situated to service both the domestic and export markets. The new facility joins a Dow styrene butadiene latex facility and a joint venture polystyrene resin facility, which began operations in 2002. All three facilities are world-scale and state of the art.

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