Asahi Kasei/Bluestar in jv for mPPE output in China

Japanese firm Asahi Kasei has concluded a joint venture agreement with China National Bluestar Group, a subsidiary of China National Chemical Corp. (ChemChina), for the integrated production and sale of modified polyphenylene ether (mPPE) in China, marketed as Xyron, including its intermediate materials 2,6-xylenol and polyphenylene ether (PPE), with a capacity of 30,000 tonnes/year for PPE and 2,6-xylenol and 20,000 tonnes/year for mPPE.

A final investment decision is conditional upon receipt of antitrust clearance, procedures to establish the joint venture, and detailed evaluation of the economics of the joint business.

Asahi Kasei says it is advancing a strategic global expansion of its engineering plastics business in the Material sector centered on automotive applications. Xyron mPPE, in particular, is expected to enjoy strong demand growth in China in environmental and energy applications including electric vehicle battery modules and solar panel components. Currently, Asahi Kasei manufactures intermediate materials for mPPE in Singapore, and its global production capacity for Xyron is 62,000 tonnes/year. The joint venture with Bluestar will enable Asahi Kasei to expand its business for mPPE in the strategically important Chinese market.

Bluestar, China’s only manufacturer of 2,6-xylenol and PPE, sought to expand capacity to meet growing demand and to enter the mPPE business. The joint venture to manufacture and sell 2,6-xylenol, PPE, and mPPE will leverage Bluestar’s technology for 2,6-xylenol and PPE together with Asahi Kasei’s mPPE compounding technology and applications development capability to facilitate further expansion in the growing Chinese market.

The jv will be set up by August this year and the final investment decision is expected in 2018.

The manufacture of mPPE begins with phenol and methanol as raw materials. Phenol and methanol are used to synthesise 2,6-xylenol, which is then polymerised into PPE. The PPE is compounded with other polymers and various combinations of glass fibre, flame retardant, and other additives to form mPPE. Featuring heat resistance, flame retardance, dimensional stability, and mechanical properties, mPPE is used in fields ranging from office equipment, automotive components (relay blocks, electric vehicle battery modules, etc.), junction boxes for solar panels, industrial components, and electrical and electronic parts (connectors, etc.)

Asahi Kasei produces 2,6-xylenol at its wholly owned subsidiary Asahi Kasei Plastics Singapore and PPE at Polyxylenol Singapore.