Rising naphtha costs affect profits of five major Japanese players

12-May-08

Japan's five major chemical companies have suffered recurring profit declines in the year ending March, due to the rising naphtha values. Though the companies managed to achieve sales growth as they raised polymer prices to reflect the higher cost of naphtha, the speedy increases in naphtha price amid growing global demand limited their ability to pass rising costs on to buyers in a timely manner. Mitsubishi Chemical Holdings Corp. and Mitsui Chemicals Inc. suffered from falling prices of high-purity terephthalic acid (PTA). Sumitomo Chemical Co. and Tosoh Corp. failed to make timely price hikes for polyethylene and other products. Asahi Kasei Corp.'s petrochemical division benefited from the surging price of acrylonitrile.