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Maruzen Petrochemical Japan to close ethylene unit at Chiba

Maruzen Petrochemical Japan to close ethylene unit at Chiba

Maruzen Petrochemical in Japan, a subsidiary of Cosmo Energy Holdings will close its ethylene plant in Chiba during the fiscal year 2026/27 and consolidate its production at Keiyo Ethylene - its joint venture with Sumitomo Chemical - the companies announced on Tuesday.

The three companies released a joint statement saying that the move is intended to improve the utilization rate of Keiyo Ethylene. Keiyo Ethylene is owned by Maruzen and Sumitomo, respectively.

Low operating rates have plagued Japanese ethylene plants due to a global oversupply caused by China's large-scale capacity expansions, as well as a declining domestic market.

Energy transportation is also under increasing pressure from the industry to achieve carbon emissions net-zero.

Maruzen Petrochemical, and Sumitomo Chemical, decided that they would optimize their ethylene production near Tokyo in the Chiba region to reduce costs and maintain competition.

The Chiba unit of Maruzen, which began operations in 1969 has a production capacity of approximately 525,000 metric tonnes per year. Keiyo Ethylene was launched in 1994 and has a production capacity of 768 tons per annum.

Last year, Idemitsu Kosan Japanese oil refiner and Mitsui Chemicals announced that they would consolidate their ethylene compounds in Chiba.

Ethylene, a petrochemical, is used in the production of plastics like polyethylene to make plastic bags and containers. (Reporting and editing by Yuka Obayashi)

(source: Reuters)