MOSCOW (MRC) -- Showa Denko K.K. (SDK) decided to terminate operation of its production lines to synthesize unsaturated polyester resin (UP) and vinyl ester resin (VE) at Isesaki Plant by the end of June 2021, and concentrate domestic production of UP and VE at Tatsuno Plant in order to improve profitability of its UP and VE businesses, said the producer.
SDK’s functional polymer business has production lines at two bases in Japan, two bases in China and one base in Thailand. UP is marketed mainly as molding material for automotive parts, housing and construction materials. VE is marketed mainly as corrosion resistant material and electronic material. The demand for UP and VE is increasing in overseas markets, especially in China and ASEAN countries, due to increases in house building and infrastructure construction, and the growth of automotive industry.
However, in the domestic market, the demand for UP and VE is decreasing due to a decrease in new house building, because the use as housing material is the main use for UP and VE in Japan. Therefore, SDK decided this time to concentrate its operation to produce UP and VE at Tatsuno Plant, aiming to streamline production of UP and VE in Japan. In addition, SDK decided to concentrate its marketing effort for UP and VE on market segments which are expected to be highly profitable and grow, aiming to strengthen earning power of the UP and VE businesses. In Japan, SDK will focus its marketing effort on infrastructural use.
Outside Japan, SDK will focus its sales effort on promising markets including China and ASEAN. Furthermore, Isesaki Plant will commit itself to development and production of highly functional resins for electronics, whose market continues growing.
The Showa Denko Group’s Vision is to make itself a “KOSEIHA Company” (a group of KOSEIHA Businesses that can maintain profitability and stability at high levels over a long period), and the Group aims to make more than half of its businesses KOSEIHA Businesses by 2025. With regard to its functional polymer business, SDK aims to make it a KOSEIHA Business by selecting appropriate market segments and improving its profitability.
As MRC informed earlier, Showa Denko K.K. (SDK) decided to establish its subsidiary’s second factory in Shanghai to produce high-purity gases for electronics.
As per MRC, Showa Denko K.K. in March 2018, it stopped production at a cracking unit in Oita (Oita, Japan) for preventive maintenance. Maintenance at this enterprise with a capacity of 691 thousand tons of ethylene per year continued until April 19, 2018.
Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,904,410 tonnes in the first eleven months of 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments increased from both domestic producers and foreign suppliers. The PP consumption in the Russian market was 1,161,830 tonnes in January-November 2019, up by 7% year on year. Deliveries of all grades of propylene polymers increased, with the homopolymer PP segment accounting for the largest increase.
Showa Denko K.K. Mainly engaged in the petrochemical business. The company's petrochemical division produces and markets industrial gases, olefins, organic chemicals, and others.
MRC