MITSUBISHI / ASAHI KASEI
Consolidation of two Japanese crackers by 2016 / Streamlining of S-SBR chain / Difficult market
Amid a difficult market for petrochemical feedstocks, two leading Japanese producers, Mitsubishi Chemical (MCC, Tokyo / Japan; www.m-kagaku.co.jp) and Asahi Kasei Chemicals (Tokyo / Japan; www.asahi-kasei.co.jp), have announced plans to consolidate their two jointly operated crackers in the Mizushima industrial zone by 2016. The decision was based on the results of a study launched in August 2013. Separately, Asahi Kasei said it will streamline production along the starting materials chain for S-SBR rubber.
In a joint market communication, the partners said they see “an increasing necessity to establish the optimum production configuration in order to strengthen competitiveness and enhance earnings ability.” The current plan calls for the closure of Asahi Kasei’s 500,000 t/y cracker and an upgrade of the same-sized Mitsubishi facility to 570,000 t/y. Alongside ethylene and propylene, affected products include C4, cracked gasoline, crude hydrogen and other secondary gases, along with heavy ends as by-products, the companies said.
The Japanese partners began preparing for the capacity downgrade as early as 2011, with the creation of the 50:50 joint venture Nishi Nippon Ethylene (Tokyo / Japan). Initial plans foresaw reducing ethylene output by 30% up to 2012. This would have meant cutting cracker capacity from 1m t/y to 700,000 t/y – see Plasteurope.com of 28.02.2011.
Faced with falling domestic demand, competition from cheap imports from other parts of Asia and rising feedstock costs, Ashai Kasei said it will close a number of its Japanese facilities up to 2016. The 150,000 acrylonitrile plant (ACN) at Kawasaki / Japan will close in August of this year. The company, which now produces 1.2m t/y at four locations, will downsize to two Japanese production sites for the rubber chemical. The 100,000 t/y unit at Mizushima – currently used to make another, unidentified, product – will concentrate in future on the other product. The site’s 200,000 t/y facility will remain open.
Asahi Kasei said the realignment will allow it to focus supply more clearly by geographic area. Japanese production will be earmarked entirely for domestic customers, while the 560,000 t/y plant in South Korea will be focused on the markets of Korea, China and Taiwan. The ACN plant in Thailand will serve customers in the ASEAN countries exclusively.
Citing a deterioration in the supply-demand balance for styrene monomer, the Japanese chemical producer said it will close its older, 320,000 t/y SM plant at Mizushima in March 2016 and refocus the remaining plant, which Plasteurope.com's Polyglobe capacity database (www.polyglobe.net) shows has capacity for 390,000 t/y, on domestic and captive consumption. “This renewed focus,” it said, “will reduce risks associated with fluctuations in Asian market prices, enabling earnings to be stabilised.”
At the same time, Asahi Kasei will refocus its ABS polymer business on SAN compounds produced at Kawasaki, with ABS copolymer for compounding to be bought in. This will trigger the closure of the 65,000 t/y ABS plant at Mizushima in December 2015. The company hopes this move will help improve earnings of its compounding operations.
Other plans include the closure of a 24,000 t/y SB-latex facility at Mizushima, also in December 2015, with production to be concentrated at Kawasaki. This will cut output capability in Japan by a quarter against the current volume of 60,000 t/y at the two sites. “Together with the further advancement of high value-added products, this will enable improved earnings by reducing fixed costs and increasing production efficiency,” the Japanese chemical producer said.
As part of plans to realign its epoxy resins business to focus on high-end products – such as “Novacure”, its latent curing agent for epoxy resins manufactured at Fuji / Japan – Asahi Kasei will close its 37,000 t/y resins plant at Mizushima in May 2015.
In connection with the sweeping operations revamp, the company said it will post an extraordinary loss of JPY 18 bn (about EUR 126,000) for the fourth quarter of its 2013 financial year that ends on 31 March 2014. Consequently, it has revised downward its earlier forecast for 2013 net income from JPY 77 bn to JPY 65 bn.
In a joint market communication, the partners said they see “an increasing necessity to establish the optimum production configuration in order to strengthen competitiveness and enhance earnings ability.” The current plan calls for the closure of Asahi Kasei’s 500,000 t/y cracker and an upgrade of the same-sized Mitsubishi facility to 570,000 t/y. Alongside ethylene and propylene, affected products include C4, cracked gasoline, crude hydrogen and other secondary gases, along with heavy ends as by-products, the companies said.
The Japanese partners began preparing for the capacity downgrade as early as 2011, with the creation of the 50:50 joint venture Nishi Nippon Ethylene (Tokyo / Japan). Initial plans foresaw reducing ethylene output by 30% up to 2012. This would have meant cutting cracker capacity from 1m t/y to 700,000 t/y – see Plasteurope.com of 28.02.2011.
Faced with falling domestic demand, competition from cheap imports from other parts of Asia and rising feedstock costs, Ashai Kasei said it will close a number of its Japanese facilities up to 2016. The 150,000 acrylonitrile plant (ACN) at Kawasaki / Japan will close in August of this year. The company, which now produces 1.2m t/y at four locations, will downsize to two Japanese production sites for the rubber chemical. The 100,000 t/y unit at Mizushima – currently used to make another, unidentified, product – will concentrate in future on the other product. The site’s 200,000 t/y facility will remain open.
Asahi Kasei said the realignment will allow it to focus supply more clearly by geographic area. Japanese production will be earmarked entirely for domestic customers, while the 560,000 t/y plant in South Korea will be focused on the markets of Korea, China and Taiwan. The ACN plant in Thailand will serve customers in the ASEAN countries exclusively.
Citing a deterioration in the supply-demand balance for styrene monomer, the Japanese chemical producer said it will close its older, 320,000 t/y SM plant at Mizushima in March 2016 and refocus the remaining plant, which Plasteurope.com's Polyglobe capacity database (www.polyglobe.net) shows has capacity for 390,000 t/y, on domestic and captive consumption. “This renewed focus,” it said, “will reduce risks associated with fluctuations in Asian market prices, enabling earnings to be stabilised.”
At the same time, Asahi Kasei will refocus its ABS polymer business on SAN compounds produced at Kawasaki, with ABS copolymer for compounding to be bought in. This will trigger the closure of the 65,000 t/y ABS plant at Mizushima in December 2015. The company hopes this move will help improve earnings of its compounding operations.
Other plans include the closure of a 24,000 t/y SB-latex facility at Mizushima, also in December 2015, with production to be concentrated at Kawasaki. This will cut output capability in Japan by a quarter against the current volume of 60,000 t/y at the two sites. “Together with the further advancement of high value-added products, this will enable improved earnings by reducing fixed costs and increasing production efficiency,” the Japanese chemical producer said.
As part of plans to realign its epoxy resins business to focus on high-end products – such as “Novacure”, its latent curing agent for epoxy resins manufactured at Fuji / Japan – Asahi Kasei will close its 37,000 t/y resins plant at Mizushima in May 2015.
In connection with the sweeping operations revamp, the company said it will post an extraordinary loss of JPY 18 bn (about EUR 126,000) for the fourth quarter of its 2013 financial year that ends on 31 March 2014. Consequently, it has revised downward its earlier forecast for 2013 net income from JPY 77 bn to JPY 65 bn.
11.03.2014 Plasteurope.com [227735-0]
Published on 11.03.2014
German version of this article...