Beijing - German chemical giant Bayer on Friday formally launched production at a new plant in Shanghai with the capacity to produce 350,000 tons annually of diphenylmethane diisocyanate (MDI).

   "The new world-scale plant is the largest MDI facility of its kind in the world," Bayer said a press release issued in Shanghai.

   It said it had also broken ground on the construction of another plant at its purpose-built Bayer Integrated Site Shanghai to produce 250,000 tons of toluene diisocyanate (TDI) per year by 2010.

   "With these projects Bayer Material Science is emphasizing its commitment to the growth markets in China and the whole Asia Pacific region," Patrick Thomas, chairman of Bayer Material Science, said in a statement.

   "Innovative process technologies strengthen our cost leadership in isocyanate production and thus our competitiveness," Thomas said.

   MDI is a raw material used mainly for polyurethane rigid foams designed as insulation material in the refrigeration and building industries.

   TDI is used to produce flexible polyurethane foam mainly aimed at makers of furniture, mattresses, and car seats.

   Thomas said China was already Bayer's most important market in the Asia Pacific region and its third-largest global market.

   The company expects more growth in China, which is likely to become the world's biggest consumer of polyurethanes by 2015, he said.

   Advanced technology should help Bayer to use 30 per cent less energy at the Shanghai complex, Thomas said. (dpa)