Mitsui Chemicals studies use of ethanol in the production of petrochemicals

Mitsui Chemicals, whose CEO spoke on Friday, is looking into the use of ethanol in its naphtha crinklers to increase their competitiveness in the face of an oversupply within the global petrochemical industry.

Hashimoto Osamu is the president and CEO of Mitsui Chemicals. He spoke on the sidelines at the Asia Petrochemical Industry Conference.

Mitsui, one of several producers in the area, is looking to switch its feedstock to ethane from naphtha due to the excess capacity of petrochemicals primarily from China. This has squeezed the margins.

Osamu anticipates that the petrochemical industry in Japan will continue to consolidate by 2030, due to the difficult market conditions.

He predicted that the margins for petrochemicals would recover within three to four year after China's new capacity expansions slow down.

The company is also worried about the impact that trade tariffs could have on Japan's imports, which could affect petrochemical use.

Osamu stated, "We are watching and waiting as it's volatile...sofar our customers in the automotive industry have not been impacted. But if they were affected, then our exports to USA could be impacted."

(source: Reuters)