Japanese manufacturers have been cutting back their production of ethylene, a key petrochemical used to make plastics. Some are planning to halt production altogether. The moves come in response to surging ethylene output in China.
Mitsui Chemicals and Idemitsu Kosan have started talks to suspend operation at one of the two ethylene production complexes they jointly operate in Chiba Prefecture. Their target date is around fiscal 2027.
It would be the first such suspension by a Japanese ethylene maker in about 10 years. The aim is a roughly 40-percent reduction.
Ethylene production levels serve as a key indicator for the petrochemical industry as a whole.
Factories in Japan have been scaling back production for over one and a half years. The Japan Petrochemical Industry Association says domestic output fell to a 30-year low last year.
Resonac Holdings has disclosed plans to spin off a complex in Oita in western Japan that contains an ethylene production facility. The company says the move will allow it to focus on chip-related businesses.
Mitsubishi Chemical Group also plans to discuss separating and realigning its petrochemical business.