Sumitomo Chemical to Suspend Operations of a Portion of LDPE Manufacturing Facilities at Chiba Works to Improve Production Efficiency
Accelerating Business Restructuring as Part of its Short-Term Intensive Performance Improvement Measures

Oct. 29, 2024

Sumitomo Chemical has decided to suspend operations of a portion of its low-density polyethylene (LDPE) manufacturing facilities at its Chiba Works in Ichihara City, Chiba Prefecture, Japan, by the end of fiscal year 2024, which will result in a reduction in annual production capacity of 20,000 tons. The Company expects this measure, combined with the various rationalization efforts that it has implemented thus far, to lead to improving the overall operating rate of the remaining facilities.

LDPE is a synthetic resin that offers excellent flexibility, transparency, resistance to impact and chemicals, and electrical insulation. Due to these advantages, it is widely used in various applications, including packaging materials for food and other goods, agricultural films, materials for food bottles and other molded products, and coatings for electrical wires, making it an essential material that supports various industries and people’s daily lives.

However, demand for LDPE in Japan has been declining due to factors such as population decline and an aging society with a low birthrate, and it is not anticipated to have significant future growth. In light of these changing business conditions, Sumitomo Chemical has decided to take action to streamline the LDPE production operations at its Chiba Works. In addition to this, the Company will improve its product portfolio to cater to high value-added areas and to better meet customer needs. Furthermore, the Company will work on fixed cost reduction at the remaining facilities, as well as efforts to strengthen its competitiveness in raw materials, such as the recently announced joint study with Maruzen Petrochemical Co., Ltd. to optimize the operations of their joint venture Keiyo Ethylene Co., Ltd. Sumitomo Chemical will continue to explore and implement all possible improvement measures.

Sumitomo Chemical is implementing short-term intensive performance improvement measures and, as part of these efforts, is accelerating the restructuring of its businesses. The Company will steadily advance these measures to ensure a V-shaped recovery in fiscal 2024, while also carrying out fundamental structural reforms.

Contact

Sumitomo Chemical Co., Ltd.
Corporate Communications Dept.
https://www.sumitomo-chem.co.jp/english/contact/public/