DSM Chemicals has been part of the Augusta Landscape for over 50 years. Several name changes have passed over its signage – many people will remember it as Columbia Nitrogen – but it has always been the same company. Its current identity readily connects it with its Netherlands-based parent company, DSM, which has multiple business groups performing a wide range of activities for a variety of end markets. DSM Chemicals is a business unit within the Polymer Intermediates Business Group, which accounts for approximately 18 percent of DSM’s overall revenues. Two other business units within the Polymer Intermediates group are each located in Asia and Europe.

The facility in Augusta is a manufacturing complex that also serves as the business headquarters housing the sales and marketing teams for the Americas. Fifty years ago in its infancy, the chemical company’s original plant, since divested, produced fertilizer. “Georgia, from an agricultural perspective, was a great location,” says David Leach, Vice President of Finance. The caprolactam plants were later built on the site to take advantage of the ammonia availability provided by the fertilizer manufacturing operations. Gradually, the plant switched focus and began primarily producing caprolactam. Caprolactam is polymerized into nylon 6, a synthetic fiber used in carpets and engineered plastics.

The first caprolactam project was built in the 1960s. In the 1970s, the two plants operated today were built. Production capacity has expanded significantly since the original caprolactam investment. Leach estimates that it has tripled. Coming full circle, DSM Chemicals sells a byproduct of caprolactam production, ammonium sulfate, to the fertilizer industry.

DSM Chemicals participates in a commodity-based industry. Their products compete on price and reliability rather than differentiation from competitors’ goods.  High expenditure on fixed assets required to convert raw materials to product paired with relatively low profit margins presents challenges. Product price changes as cost of raw materials goes up or down. Even small fluctuations in raw materials can influence the bottom line. A primary raw material needed for caprolactam production is derived from oil refinement and natural gas. When cost of raw materials is low, as natural gas is currently, DSM Chemicals strives to find ways to make that benefit sustainable.

 “Our customer base is rather limited,” says Leach. “We like to partner with few key customers where we can establish long-term relationships.”  But the company must also establish a footprint outside of the Americas and poise itself to sell product in markets where the cost of caprolactam is high. DSM Chemicals sends much of its volume to Asia. He goes on to say, “You win in the market by improving how you convert your raw materials into your finished goods.” A constant battle rages to maximize efficiency while lowering cost of production.  

A unique challenge faced by DSM Chemicals is the recruitment and hiring of chemical engineers. Even with two major nearby universities – Georgia Technical Institute and Clemson University – that graduate chemical engineers, few of those graduates choose to stay in the area. Most opt to take jobs in the Gulf of Mexico’s oil refinement industry.

One of the largest and most complex chemical plants in Georgia, DSM Chemicals employs, either directly or through sub-contractors, around 700 people. The 540 acre consolidated industrial site functions smoothly as one unit but conducts the operations of a sister company, joint-ventures and contracted activities. Maintenance workers, highly skilled shift labor, technicians, engineers and administrative staff comprise the workforce onsite.

For the most part, these are high paying jobs. Even non-degreed highly skilled shift employees have the potential to earn six-figure incomes. The economic impact of that kind of spending power is tremendous for the CSRA. Also contributing to DSM Chemicals’s effect on the local economy is the property tax burden the company carries in Richmond County. In addition, DSM Chemicals is a sponsor of United Way with almost 100 percent employee participation. The reach also extends to several local schools to which the company donates computers and lab supplies and employees donate countless volunteer hours.

Leach is optimistic about the manufacturing renaissance in the U.S., particularly in the area of chemicals. He says, “I think we’re well-positioned to remain here for years to come.” With the right personnel in place and strategic refurbishment and modernization of facilities, he predicts DSM Chemicals will remain in Augusta for at least another 50 years.