Mitsui Slashes Operations - C&EN Global Enterprise (ACS Publications)

Feb 17, 2014 - First Page Image. Seeking to shake up a business dependent on selling commodity chemicals in the stagnant Japanese market, Mitsui Chemi...
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NEWS OF TH E WEEK

SYRIA MISSION MOVES SLOWLY CHEMICAL WEAPONS: Stockpile turnover delayed by poor security

ACING WIDE CRITICISM over the slow prog-

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ress in the international effort to destroy Syria’s chemical warfare arsenal, the Syrian government says that its most dangerous chemical weapons will be removed from the country by Feb. 28. And it insists that it will meet the final June 30 deadline for the total elimination of its chemical weapons program. Syria has missed two deadlines in a United Nationssanctioned timetable for the destruction of its chemical arms. Under the accord, Syria was supposed to remove its most poisonous chemical agents by Dec. 31 and give up its entire stockpile by Feb. 5. The Syrian government has ascribed the delays to security concerns related to the civil war. So far, only a small portion of Syria’s 1,300-metric-ton stockpile has been transported from 12 storage sites around the country to the Port of Latakia. “The international community is poised and ready to destroy Syria’s JIM WATSON/AFP/GETTY IMAGES/NEWSCOM

Scientists will use the U.S.-developed Field Deployable Hydrolysis System units, shown here aboard the Cape Ray, to neutralize chemical weapon materials from Syria.

TURNAROUND To improve profitability, Japan’s Mitsui is closing seven chemical plants in four locations: Kashima ◾ Toluene diisocyanate ◾ Specialty diisocyanates ◾ Maleic anhydride ◾ Fumaric acid Omuta ◾ Methylene diphenyl diisocyanate Chiba ◾ Phenol Ichihara ◾ Bisphenol A

MITSUI SLASHES OPERATIONS RESTRUCTURING: Major chemical

company will shutter plants, seek to reverse years of losses

EEKING TO SHAKE UP a business dependent

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on selling commodity chemicals in the stagnant Japanese market, Mitsui Chemicals is closing multiple plants in Japan and bringing in a new CEO. With sales of $17.6 billion in the fiscal year ending March 31, 2013, Mitsui is one of Japan’s largest chemical companies. However, it has not turned a profit for three of the past four years and expects to lose money again in the fiscal year that ends on March 31. The firm says it hopes to return to profitability next year because earlier changes are starting to pay off. Tsutomu Tannowa will become CEO of Mitsui effective April 1, replacing Toshikazu Tanaka. At present, Tannowa is the senior officer in charge of several of the businesses that are draining the company and is said to be the architect of the downsizCEN.ACS.ORG

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chemical weapons,” Pentagon spokeswoman Jennifer Elzea says. “It is [President Bashar] Assad regime’s responsibility to transport the chemicals to Latakia safely for removal. We expect them to meet their obligation to do so.” From Latakia, the material is being loaded onto Norwegian and Danish vessels for eventual transfer to the MV Cape Ray, a U.S. cargo ship on a mission to destroy Syria’s most dangerous chemical weapons. The ships will rendezvous at the Italian port of Gioia Tauro. The Cape Ray departed Norfolk Naval Station in Virginia on Jan. 27 for the region. It will remain at a naval base in Rota, Spain, until the Syrian regime turns over the rest of its stockpile, Defense Department officials said last week. At Gioia Tauro, the Cape Ray will take possession of the Syrian sulfur mustard agent and nerve agent precursor chemicals from the Scandinavian ships. From there it will head out to international waters in the Mediterranean Sea. Chemists, engineers, and other civilian specialists from the U.S. Army will use two mobile hydrolysis units on board the Cape Ray to neutralize the chemical weapons (C&EN, Feb. 10, page 24). Only 11% of Syria’s chemical weapons stockpile has been shipped to Italy, according to The Hague-based Organisation for the Prohibition of Chemical Weapons, which is overseeing the operation. Once all the chemical materials are onboard the Cape Ray, neutralization operations will take between 45 and 90 days, the Pentagon says.—GLENN HESS

ing plan. The company has not announced layoffs. As part of that plan, Mitsui will close several phenol and urethane chemical facilities by the end of 2016. It also announced that it will build the world’s largest plant for xylylene diisocyanate, a urethane monomer mostly used in ophthalmic lenses. The urethane plants Mitsui is shuttering suffer from high operating costs because of their relative small size. For instance, a methylene diphenyl diisocyanate (MDI) facility slated for closure has an annual production capacity of 60,000 metric tons. By comparison, BASF is building an MDI plant in China with a capacity of 400,000 metric tons. The phenol plant that Mitsui and Idemitsu, its partner, are closing is large by world standards. But Mitsui says demand in Japan is not strong enough to justify the facility, and the export market is already well supplied. It’s not clear that the closure program will be enough to pull Mitsui out of its tailspin. “It will not significantly reduce their dependence on sales to manufacturers based in Japan,” says Yoshihiro Azuma, a stock analyst at the investment firm Jefferies. Moreover, the moves will unfold in slow motion. “They’ve announced total cost reductions of $135 million, but the change will not become effective until 2017,” Azuma cautions.— JEAN-FRANÇOIS TREMBLAY

FEBRUARY 17, 2014