Mitsui’s forays in the auto sector: biopolyol tie-up in India and PP output expansion in the US

Mitsui’s forays in the auto sector: biopolyol tie-up in India and PP output expansion in the USJapanese chemicals firm Mitsui Chemicals and Itoh Oil Chemical have entered into a joint venture with India's Jayant Agro-Organics to set up a company in India to produce biopolyols, the main raw materials of which are non-edible plant derived fatty acid. Mitsui is also expanding output for PP by 21,000 tonnes in the US and 13,000 tonnes in Mexico to meet the growing demands of the automotive sector.

Mitsui manufactures and distributes PU raw materials for various applications including that of insulation application for refrigerators. It is the largest supplier of PU for automotive interior to Japanese manufacturers and is the world's only commercial supplier of non-edible plant derived biopolyol. The joint venture will make biopolyol cost competitive with fossil-derived polyol, allowing Mitsui to target further expansion of automotive application sales on its own and through its six system houses strategically located throughout Asia.

Itoh Oil Chemical is Japan's leader in castor oil production with state-of-the-art refineries, manufacturing technology, and quality control expertise in castor oil derivatives such as fatty acids. It targets use of other by-products, co-produced in the manufacture of biopolyol, in development of new applications to expand its castor oil derivative market and intensify existing businesses such as its urethane elastomer operations.

Jayant Agro-Organics is the world's leading producer of castor oil. Through supply of raw materials derived from castor oil to the new joint venture, the company is targeting development of new business in the castor oil derivatives sector to further strengthen its position in the castor business. The partnership brings the unique strengths of the respective companies to the table in India, where 80% of the world's castor oil is produced and will establish a stable supply base for overwhelmingly cost competitive biopolyol.

Meanwhile, Mitsui and Prime Polymer, a Mitsui Chemicals subsidiary, will expand the PP compound production capacity at the US subsidiary Advanced Composites’s plant by 21,000 tonnes and also expand output at the Mexican subsidiary Advanced Composites Mexicana’s plant by 13,000 tonnes to the meet growing demands of the automotive sector.

Mitsui targets strengthening and further production expansion of its already PP for automotive materials, currently manufactured in eight major world markets (Japan, US, Mexico, Brazil, Europe, India, Thailand, and China).

Although the North American automotive industry was negatively impacted by the global financial crisis, the market has returned to normalcy with forecasts of significant growth in the future.

“The planned augmentation will strengthen Mitsui Chemicals' current top class position in the North American market and thereby make it better able to contribute to global strategies of automobile manufacturers,” says Akio Ayukawa, Managing Executive Officer at Mitsui Chemicals.v“In addition, by reinforcing R&D functions at strategic sites, Mitsui Chemicals will strengthen its ability to support diverse local market strategies of automobile manufacturers.”

Mitsui and Prime Polymer will continue to strategically intensify and expand operations through ongoing collaboration and reinforcement of production, sales, and technological support structures necessary in providing state-of-the-art, performance-driven materials.

The above capacity announcements augment Mitsui’s previously-announced expansions that were implemented in the third quarter of 2013. Advanced Composites boosted capacity by 14,000 tonnes/year and with the new addition it’s total capacity will be around 290,000 tonnes/year by the end of next year. Similarly, Advanced Composites Mexicana increased its capacity by 25,000 tonnes/year and with the latest addition will mean the company will have a total capacity of 83,000 tonnes/year by 2014.

(IMA)

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