Mitsui Chemical decided to close the Phenol production line at its Ichihara plant in Japan

Mitsui Chemical recently announced that it plans to close its Phenol plant in Ichihara, Japan, which has an annual production capacity of 190,000 tons, by the end of fiscal 2026. This decision marks the beginning of a deep restructuring of Mitsui Chemical Group's business structure.

The Basic and Green Materials business unit of Mitsui Chemical Group, particularly the phenol business, is committed to reinventing itself as a sustainable green chemicals business with competitive derivatives at its core.

To achieve this, the Group has been optimising its production line set-up in line with market demand and ensuring that its derivative products are competitive in the market. This transformation began as early as the 2008 global financial crisis, and the Group laid the foundation for future growth by restructuring its Fundamentals and Green Materials business units.

Currently, Mitsui Chemical produces Phenol at three sites: Ichihara, Chiba; Takaishi, Osaka; and Shanghai, China. Since the Ichihara plant began producing Phenol in 1970, operations have continued to expand, driven by growing demand for the key derivatives bisphenol A and phenolic resins. However, since 2022, the business environment has become increasingly challenging due to multiple factors, including declining domestic demand and oversupply due to new production facilities in China and other parts of Asia.

In response to this challenge, Mitsui Chemical has taken a number of rationalization measures, but after careful consideration, the Company concluded that maintaining the profitability of phenol production at the Ichihara plant is no longer a viable option. Although the Ichihara plant will cease phenol production, Mitsui Chemical still plans to build a capital-efficient and profitable Phenol supply chain to ensure a stable product supply to customers.