Citing the “increasingly challenging” business environment of the worldwide styrene monomer (SM) market, Japan’s Sumitomo Chemical (Tokyo; www.sumitomo-chem.co.jp/english) has announced plans to sell its 40% stake in the joint venture Chiba Styrene Monomer Limited Company (CSM, Toyko) to majority partner Denki Kagaku Kogyo Kabushiki Kaisha (Denka, Tokyo; www.denka.co.jp/eng/top.htm) at the end of April. In future, Sumitomo said it will concentrate its SM business solely on its affiliate Nihon Oxirane Co. Ltd (NOC).

In the past, Sumitomo purchased monomer from CSM for distribution through its NOC affiliate, an agreement that will end with the jv’s dissolution. In future, the Japanese chemical producer will focus its styrene business solely on this company. Without being specific, Sumitomo said that, in an effort to “build a solid earnings base,” it will streamline operations. According to unconfirmed reports, Denka plans to close its 240,000 t/y styrene monomer plant in Chiba prefecture by mid-May of this year and concentrate production at CSM’s more competitive 270,000 t/y facility nearby.

Demand for styrene monomer remains sluggish in Europe and North America, and capacity expansions in China, the Middle East and elsewhere are leading to overcapacity in the market, Sumitomo says. It adds that the situation is even more severe for Japanese exporters, whose price competitiveness has been “significantly” affected by the appreciation of the yen.