On 11 September, Sumitomo Chemical announced the closure by the end of September 2024 of two of the three MMA and PMMA production lines at its Singapore subsidiary. Once the changes are done, the factory will make about 80% less MMA monomer and 70% less PMMA.
Reasons for Reduction
Sumitomo Chemical has reduced its capacity due to an imbalance in the MMA industry. This will affect the company’s future profits, especially for general products.
Sumitomo Chemical will focus on high-value PMMA products and use its technology to make the business more flexible. It will also create sustainable value through recycling technologies that are more environmentally friendly. In December 2022, the company finished a pilot plant for recycling PMMA at Bloom Classic in Japan.
Industry Strategy for the Future
In August, the export volume rose, and some enterprises raised prices. The cumulative increase was 700 yuan/tonne. However, the downstream PMMA price increase did not keep pace with the MMA plant capacity utilisation. Profits reversed and demand slowed, putting pressure on MMA producers. These producers are focusing on two strategies: controlling the cost of raw materials and targeting the high-level market.
Controlling the Cost of Raw Materials
Oversea representative: Mitsubishi Chemical will build a 350,000-tonne-per-year MMA plant in the US in early 2024 using the Alpha process. At the same time, it will shut down the ACH plant in Hiroshima, Japan. Alpha process makes it easy to obtain raw materials and reduce costs.
Domestic representative: Panjin Sanli Zhongke New Materials Co., Ltd. invested in the first C2 route MMA production facilities and products in China in early 2022. Trial production is expected to start in September 2024. This process costs about one-third less than the mainstream C4 method.
Targeting the high-level market
Oversea representatives: In June, Roehm Chemical said it runs several specialty PMMA production lines at its Wallingford plant. Production there has increased.
Domestic representative: Zhuhai Xintao Optical Materials Co., Ltd. plans to invest 700 million yuan to build two production lines of optical-grade PMMA particles. The project is expected to reach a production capacity of 120,000 tonnes/year.