Now Available: Japan Petrochemicals Report 2015

Japanese cracker capacity is being drastically cut as the country's ageing petrochemicals industry struggles to compete in an increasingly competitive Asian market, according to BMI's latest Japan Petrochemicals report.

Japanese olefins production has been adversely affected by a drop in Japanese polymer output. Polymer production but has failed to return to levels witnessed before the 2008 financial crisis. The trends spell trouble for Japanese petrochemicals producers, who are grappling with falling competitiveness and squeezed margins.

Half of cracker capacity is fed by imported naphtha, which has risen in cost in recent years, losing competitiveness against ethane-fed production being established in the Middle East and the US. BMI calculates that crude distillation capacity fell considerably in reaction to new refining laws - this has affected the domestic naphtha availability for the local petrochemicals industry. As such, petrochemicals capacities are being reduced and BMI expects further reductions. While we still believe Japanese refiners will struggle with low margins, the downsizing will see increased utilisation rates and help support revenues.

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* Cracker cuts are affecting operations further downstream. Japan-based Asahi Kasei Corporation is shutting down many of its domestic petrochemicals plants due to the ongoing unfavourable market conditions in Japan, including acrylonitrile, styrene plants, acrylonitrile-butadiene-styrene (ABS) epoxy resins and styrene-butadiene latex plants.
* The government has urged cuts in petrochemicals capacities even though planned cuts are taking ethylene capacity from around 8.76mn tpa in 2008 to 6.02mn tonnes by 2016.
* The domestic market on its own will not be sufficient to lift Japanese petrochemicals. While a rebound is expected in 2015, the rest of the forecast period will see low levels of growth and similarly low rates of consumption growth in petrochemicals segments exposed to the automotive industry, such as...

The Japan Petrochemicals Report has been researched at source, and features Business Monitor International (BMI)'s market assessment and independent forecasts for key petrochemicals sub-sectors. The report also analyses the impact of regulatory changes, recent developments and the background macroeconomic outlook and features competitive landscapes comparing companies by products and services, sales, market share, investments, projects, partners and expansion strategies.

BMI's Japan Petrochemicals Report provides industry professionals and strategists, sector analysts, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Japanese petrochemicals industry.

Key Benefits

* Benchmark BMI's independent petrochemicals industry forecasts to test other views - a key input for successful budgetary and planning in the Japanese petrochemicals market.

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