Sumitomo Chem to increase global PP capacity

06 August 2007 12:51  [Source: ICIS news]

TOKYO (ICIS news)--Sumitomo Chemical plans to increase the overseas capacity of polypropylene (PP) compounds for automotive applications by 86,000 tonnes/year, a company spokesman said on Monday.

 

The Japanese chemical major plans to do this by building a new plant and through the acquisition of a UK subsidiary of Asahi Kasei Corp.

 

The spokesman declined giving investment costs, but media reports put it at $85m (€61m).

 

The company was currently waiting for an approval from the UK authorities to purchase a PP compounds producer, AK and N (UK) Ltd, part of the Asahi Kasei group, together with Japanese firms Itochu Co and Toyo Ink Co.

 

He added the process would probably be completed by the end of August.

 

According to the spokesman, AK and N owns PP compounds plants in the UK and France with respective capacities of 40,000 tonnes/year and 20,000 tonnes/year, would be added to Sumitomo Chemical’s capacity upon acquisition.

 

Sumitomo Chemical also planned to build a PP compounds unit in Atlanta with a capacity of 26,000 tonnes/year, which was scheduled to start commercial production at the beginning of 2009.

 

He said that the series of projects to increase PP compounds capacity globally was part of the company’s plans to start producing PP compounds on its own, while they were produced by outsourcing before.

 

He said this would enable the company to supply products of the same quality throughout the world.

 

He also cited that more Japanese automobile manufacturers were setting up overseas production bases.

 

As part of such strategy, Sumitomo Chemical brought on stream a 10,000 tonnes/year PP compounds unit in Guandong province in China last year.

 

He said the company was considering building a new line with a probable capacity of 10,000 tonnes/year at the same site although details such as the start-up date had not been decided.

 

The chemical firm was also mulling building plants in Thailand and India, but details were yet to be decided, the spokesman said.

 

Sumitomo Chemical is to start operations of the $9.8bn petrochemical complex in Rabigh, Saudi Arabia, in the second half of 2008, which will have a PP capacity of 700,000 tonnes/year, according to the spokesman.

 

He said the company planned to use the PP produced at the plant to manufacture compounds at the production bases in Europe.

 

Sumitomo Chemical currently produces 1.35m tonnes/year of PP in Chiba, Japan, Singapore and Texas.

 

($1 = €0.72)

By: Tomomi Yokomura
+65 6780 4359

< previous article(ICIS Podcast: Chemical News Central 2 November 2009)

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly