Lanxess to Spend $74 Million on Red Pigment Factory in China

Lanxess AG (LXS), the German chemical maker whose pigments are used on the Eiffel Tower, plans to invest 55 million euros ($74 million) in a factory in China to add a new lighter tinge of red.

The factory, which will create 150 jobs, is being built at the Ningbo Chemical Park on China’s east coast and will be finished in the first quarter of 2015, Leverkusen-based Lanxess said today.

Lanxess gets about 10 percent of its sales from China and the country plays a “key role” in the German company’s growth strategy, it said. The chemical maker already has a plant for iron-ore pigments in Jinshan, Shanghai, as well as factories in Germany and Brazil.

“China is already the biggest market for iron-oxide pigments in the world and is still growing fast,” Joerg Hellwig, head of the inorganic pigments unit, said in a phone interview today.

The site in Ningbo will produce pigments that are more yellowish-red in tint than those currently manufactured at Lanxess’s biggest factory in Germany.

The Germany company has secured an extra plot of land at the Chinese chemical park for potential expansion of production although there are no concrete plans to build there at the moment, Hellwig said.

Lanxess’s pigments are also used in water treatment and can filter arsenic out of ground water, helping provide drinking water in places like Bangladesh, Hellwig said.

To contact the reporter on this story: Sheenagh Matthews in Frankfurt at smatthews6@bloomberg.net

To contact the editor responsible for this story: Simon Thiel at sthiel1@bloomberg.net

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