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Mitsubishi looking for potential partners in cracker business

11
Dec '08

Reports have started emanating from global petrochemical majors cutting output of key raw material products used by the downstream sectors of the textile industry. This trend of cutting capacities by Asian major petrochemical manufacturers is being reported since July 2008. But now the situation is spiraling out of control due to the global slowdown.

Mitsubishi Chemical Holdings Corp may also plan to consolidate its naphtha crackers with other companies and restructure the business. This was revealed by Mr. Kobayashi, CEO of the company. Mitsubishi is the country's top ethylene manufacturer and operates two plants in Japan.

This move on the part of the company has come amid reports that ethylene production in Japan fell 17.7 percent in November year-on-year, the biggest fall in 12 years. fibre2fashion.com spoke to a company official from Mitsubishi Chemicals to get a better perspective on the future moves of the company.

The spokesperson confirmed the news and said, “Main reason for this merger is due to bad economic situation. At present we have two plants at Mizushima & Kashima. We plan to quickly enter into discussion with other petrochemical refinery companies.”

He also said that, “We are in talks with 5 to 6 companies, although we would not want to disclose the name of all the companies at this point but after discussion, we will try to optimize total petro chemical complex production. Asahi Kasei is one such company with whom we have started discussion, but talks are still in planning stage.”

Asahi Kasei has also admitted to a slowdown in demand and a need to reorganize its ethylene business. Coincidentally, the naphtha crackers of Mitsubishi and Asahi are located in the same industrial complex in Mizushima. Earlier, fibre2fashion.com had reported on August 28, that Mitsubishi was planning to cut production at its cracker plants by up to 10-15 percent beginning from September 1.

Fibre2fashion News Desk - India

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