Mitsui Chemicals is exploring the possibility of using ethanol as a feedstock in its naphtha crackers in an effort to enhance competitiveness amid a global surplus in the petrochemical sector, the company’s CEO said on Friday.
“It’s not easy to completely shift from our existing crackers, but we are examining how they can be modified to accommodate ethanol,” said Hashimoto Osamu, President and CEO of Mitsui Chemicals, speaking to Reuters on the sidelines of the Asia Petrochemical Industry Conference.
With margins under pressure due to excess capacity—particularly from China— Mitsui is among several regional producers considering a switch from traditional naphtha to alternative feedstocks like ethane.
Osamu also projected that Japan’s petrochemical industry is likely to undergo further consolidation by 2030, as companies grapple with persistently difficult market conditions.
He added that while margins are currently under strain, they may begin to recover in the next three to four years, once the pace of new capacity additions in China begins to ease.
Another area of concern for the company is the impact of trade tariffs, particularly on Japanese exports, which could influence petrochemical demand.
“We’re closely monitoring the situation—it’s quite volatile. So far, our automotive clients haven’t been affected, but if they are, our exports to the U.S. could face challenges,” Osamu noted.
