not strong enough." And several organizations refused to join EJC for various reasons. AAES will now assume most of the joint functions and activities of EJC, the Association for Cooperation in Engineering, and the Engineers Council for Professional Development. The new association will be headquartered in New York City at the United Engineering Center. D
Fibers may hold up during recession Synthetic fibers, a highly unpredictable business in the past with steep ups and downs, finally may have control in sight on the worst of its whiplash characteristics—customers' inventory cycles. Because of new hard measures of inventory throughout the product chain as well as a bright future in exports, fibers may get through the apparent recession under way in the U.S. in good shape. That's the view from the top fiber producer, Du Pont. One of the main reasons for the roller coaster business cycle of synthetic fibers is producers' difficulty in gauging the fiber supply as it winds through a highly fragmented market chain to the retail consumer. That's especially true for apparel fiber, the largest part of the fiber business with 40% of total shipments last year. Although producers themselves may hold a tight rein on inventories to keep supply in line with immediate customer demand, the thousands of fabric, clothing, and retail companies down the product chain may not. When fiber supply piles up in the middle, especially during periods of rising fiber prices or scarcity, the risk of recession is greatly increased. During a recession, companies along the fiber chain shed their excess supply, order less new supply, and cause severe production drops and layoffs in fiber companies. This inventory correction process in fact may comprise most of a recession in fibers, Du Pont finds, after working out data covering the total flow of fiber in the U.S. textile market over the past few years. Retail textile consumers vary their purchases relatively little from good years to bad. Hence, stopping the wild fiber-inventory cycles may buffer fibers from recessionary fluctuations. That's the hope David K. Barnes, vice president of Du Pont's textile fibers department, held out to a textile audience at a meeting in Palm Beach, Fla., late last month. He's confident that the total fiber inven-
tory at all levels this time around faces a far smaller inventory correction than the difficult adjustment during the late stages of the 1974-75 recession. And he has hard data to back up his case. In fact, Barnes says an inventory correction in fibers is already under way in the U.S., having started in March, with the resulting reduction in net fiber supply to be about 8% over an assumed 10-month period. That's far less than half the 22% drop over 11 months in the previous recession. Even with a moderate inventory correction, U.S. fibers volume may not be hurt overall if a full recession develops in the U.S. The reason, Barnes says, is a big turnaround in
foreign trade in textile fiber goods. A drop in imports, a sharp increase in exports add up to a swing of some 720 million lb or 12% of total textile sales. This boost more than offsets the 8% volume drop due to inventory correction. "That's why I say that the textile industry went into this recession well positioned to come out of it relatively unscathed and, just as important, relatively quickly," Barnes says. That's a lot to hope for from a notoriously swing-happy part of the chemical industry. But if inventory control has really taken hold in fibers, and if Du Pont's data are correct that retail buying is relatively steady over the years, the whole face of the fibers business could change. D
Hoechst sets capital spending plans for U.S. The Hoechst Group will put about $171 million, or 15% of its total capital expenditure, into the U.S. in 1980, according to Rolf Sammet, chairman of the board of management of the Hoechst Group. Sammet told a press conference in Frankfurt, West Germany, that capital appropriations of the Hoechst Group for 1980 will be about $1.41 billion, up about 21% from 1979. About 50% of this money will be spent on fixed assets within West Germany, 15% will be spent in North America with the bulk going to the U.S., an equal amount will be spent in Western Europe outside Germany, and the remainder will be spent at company facilities elsewhere. There is some question on just where the capital spending in the U.S. is to go. The $171 million for North America is a slight increase over American Hoechst's planned capital expenditures for 1979, although exact figures for this year are not available. However, 1979 is the last year of massive spending for American Hoechst's big complex at Bayport, Tex., where the company will make styrene and high-density polyethylene at new plants. With the winding down of spending on these plants, which are scheduled to go on stream next year, quite a bit of money will be available for American Hoechst to use on other projects. It is known that Hoechst is modernizing its polyester filament spinning facilities at Spartanburg, S.C. And it recently announced plans for new production facilities for nonwoven polyester spunbond fabrics at the Spartanburg site. Initial production of this facility, which will start in the third quarter of 1980, will be 8 million to 10 million lb per year. And there
are a few other small modernizations. However, many of these have already started. There seems to be nothing scheduled that could sop up the huge investment that has been going into Bayport. The $171 million capital spending planned for this year in North America is about 28% of the $600 million that Hoechst has said it would spend in this area between 1979 and 1984. Since 1979 spending probably totaled at least 25% of the $600 million, Hoechst is now saying that it will spend more than 50% of the money planned for five years in just two. Sammet also told the press con-
Hydrogenation reactor being installed at Hoechst's Bayport, Tex., complex Oct. 8, 1979C&EN 7
