TFL is considering closing the synthetic tannin production plant in Leverkusen, Germany, by the end of 2023. The group, which produces specialty chemicals for the leather and related industries, says this assessment is the result of “weak dynamics of the tanning industries and the tanning chemicals market.” Report by CueroAmérica.

TFL is also influenced by high production costs in Germany, which is jeopardizing the profitability of companies in the sector, threatened by inflation and high energy costs. “Given the current market conditions, we need to carefully review all of our operations and be more cost-conscious,” sums up Russell Taylor, TFL’s interim chief executive.

The company is reorganizing production in Central Europe, and the first step is the disruption of synthetic tannin production at the Leverkusen plant. The goal is to contain costs in a market that is not thriving. According to the note released by the group, “the chemical industry market in Europe, and especially in Germany, faces serious profitability problems due to inflation and energy costs that remain high.” An economic environment that requires reflection “to address the poor behavior of leather”.

Taylor, who recently replaced Wolfgang Schütt as CEO, outlined the highlights of TFL’s strategy: “We will continue to focus on sustainable solutions and bio-based products. We want to strengthen our position and our leading role in offering chemicals that comply with all possible EU regulations on bisphenols.”

The decision to consider closing the Leverkusen (formerly Lanxess) plant comes after a summer of changes at the top of the group. Not only did it change CEO in July, but in August, after more than 8 years as the group’s CFO, Richard Fenton resigned and was replaced by David Blatch, who was promoted.