Sustainable action requires long-term thinking. Both elements are integral to the DNA of the family-owned company Bruggemann. For 155 years, the company has produced high-purity alcohols from renewable raw materials and production waste. Since 2023, the medium-sized company has also relied on biomass and regional waste for energy supply.

Specialty chemicals, such as sulfur-based reducing agents, contribute to energy savings and more environmentally friendly processes. With innovative recycling additives, the Heilbronn, Germany-based company supports plastic recyclers worldwide in producing high-quality recyclates. Andrea Gruß spoke with Stefan Laetsch, CEO of Bruggemann, about the specialty manufacturer's innovation and growth strategy.

CHEManager: Mr. Laetsch, what are the roots of Bruggemann? How is your business set up today?

Stefan Laetsch: The roots of the company go back a long way. Bruggemann was founded in Heilbronn in 1868 and produced alcohol from residues of nearby sugar factories and mash from viticulture. Alcohols for pharmaceutical, cosmetic, and technical applications remain a crucial part of our business today. In the 1920s, the industrial chemicals sector was added, with zinc derivatives and sulfur-based reducing agents primarily used in polymer dispersions for coatings and paints. Since the 1970s, we have been producing plastic additives, especially for modifying polyamides. In 2023, we achieved global sales of around €200 million with these three business areas and employed 300 people.

What makes ethanol production attractive and profitable for a medium-sized chemical company?

S. Laetsch: We specialize in niches. For example, we supply kosher ethanol for the food industry or GMP-certified alcohols for pharmaceutical manufacturing. As part of our sustainability strategy "Going Green," we exclusively use GMO-free raw alcohols from renewable raw materials, sourced regionally or from nearby EU countries, preferably transported by rail or ship to avoid CO₂ emissions.

Another focus is recycling alcohols. Many markets generate waste alcohols, such as from producing non-alcoholic beer. We purify and upgrade this ethanol and sell it as a high-quality product. Recycling uses significantly less energy over the product lifecycle, leading to 70% lower greenhouse gas emissions compared to conventionally produced ethanol.

We are currently working on a low-emission line for second-generation bioethanol from recycled waste and residual materials for various applications, also addressing the food-versus-fuel issue.

Which niche do you serve with your industrial chemicals business?

S. Laetsch: Bruggemann's reducing agents, especially sulfur-based, formaldehyde-free additives, are used in water-based polymer dispersions for coatings and paints. We also produce reducing agents for the construction industry to manufacture flow improvers. Despite current market downturns, particularly in Europe, we can maintain our position due to our niche and sustainability approach. For example, sulfur-based reducing agents are typically used at the end of the polymerization process, during post-polymerization. We have developed reducing agents that can also be beneficially used in the main part of the polymerization. Bruggemann is a pioneer in this area. With our additives, polymerizations can be carried out at lower temperatures without changing product properties, resulting in significant energy savings and cost advantages for polymer dispersion manufacturers.

What is the focus of Bruggemann's plastic additives portfolio?

S. Laetsch: We focus on engineering plastics, particularly polyamides and polyesters. Our wide range includes electrically neutral thermal stabilizers for polyamides in electrical and electronic applications, such as e-mobility, high-performance stabilizers for medium to very high-temperature loads, and additives for stabilizing polyolefin recyclates. Efficiency-enhancing flow improvers are also a focus, enabling shorter cycle times and thinner wall thicknesses in parts made of polyamides and polybutylene terephthalate. These additives facilitate the replacement of metal parts with plastic parts in the automotive industry, making cars lighter and reducing fuel consumption.

What solutions do you offer for plastic recycling?

S. Laetsch: We have supported the material recycling of polyamides for many years with customized additive packages. Recently, we have also offered products for recycling polyolefins. A specially developed technology repairs defects in the molecular chains caused by processing and use, which impair quality. This allows for recyclates with improved mechanical properties without the need to mix in new material. Our products enable high-quality recyclates that cannot be achieved with conventional re-stabilization, even at high dosages.

Additionally, our portfolio includes so-called compatibilizers, which enable the mechanical recycling of waste streams from incompatible polymers. They significantly improve the processability and mechanical properties of the produced polyolefin recyclates.

Bruggemann not only relies on biomass for raw materials but has also operated a biomass heating plant since 2023. When did you decide to invest in this?

S. Laetsch: In 2020, it became clear that we could no longer remain competitive with our skyrocketing energy costs. Therefore, we decided to invest in a biomass heating plant and, as part of our "Going Green" sustainability strategy, transition our energy supply from fossil fuels to renewable energy sources. The €13 million investment has made us largely independent of major energy suppliers and reduced our annual CO₂ emissions for steam production by 80%.

Despite the crisis years, Bruggemann has increased its sales by over 50% since its anniversary year in 2018. What trends contributed to this growth?

S. Laetsch: Yes, the company has grown well despite difficult market conditions. We observed a decline in demand for our products for the construction and textile industries by up to 20%. However, we saw growth in plastic additives, primarily for automotive applications, e-mobility, and tool manufacturing. Sustainability is a key driver of innovation and thus growth at Bruggemann. This theme inspires us as much as it does our customers. Together with them, we have developed new products for e-mobility and plastic recycling. We conduct this product development not only with our own resources for research, development, and application technology but also with research partners who handle specific project aspects. Project management is based in Heilbronn.

In recent years, we have also moved closer to our customers in the USA and China, significantly accelerating innovation cycles. These cycles vary greatly: while the German automotive industry's innovation cycle is four to five years, it's 1.3 years in China and less than a year in e-mobility.

However, speed is just one part of our success recipe. As a family business, we think long-term. We can afford to run a project longer without needing immediate results. Openness to innovative solutions, perseverance, and the ability to think outside the box make us successful.

What role does inorganic growth play in your strategy?

S. Laetsch: In 2022, we entered the manufacture of graft polymers by acquiring Auserpolimeri, an Italian producer of functionalized polymers. This polymer class offers diverse applications in engineering plastics, especially in impact modification of polyamides, and plays a crucial role in recyclate processing. We plan to continue steering our growth through targeted investments and acquisitions of expertise. We are currently considering establishing a fourth pillar for our specialty business, focusing on antioxidants. Additionally, we aim to further expand regionally, particularly in China and the USA, to capitalize on the opportunities in these markets.

How does the current economic situation affect your growth plans?

S. Laetsch: Despite the current market environment, Bruggemann remains focused on growth. In recent years, we have invested over €60 million in strategic investments and capacity expansions and have a solid financial position for future steps. The owner family supports the company's growth trajectory, including increasing equity to facilitate growth. 2024 will be another challenging year, similar to the previous one, affected by the negative development in the construction and textile industries. However, our current project pipeline gives us optimism. We see light at the end of the tunnel and expect significant improvements by early 2025.