Chlor-alkali Group

Tosoh produces caustic soda and chlorine at one of the largest electrolysis facilities in Asia. Caustic soda is used in paper, chemical fiber, and alumina production. Chlorine is utilized in a wide range of industries, including raw materials for PVC resin, sterilization, and bleaching.

SWOT Analysis

 Strengths

• Largest electrolysis facility in Japan with a well-balanced production capacity for caustic soda and chlorine ensuring stable operations
• Competitive infrastructure at the Nanyo Complex and other domestic manufacturing sites

 Weaknesses

• Renovation costs associated with aging facilities
• Electricity-intensive industry

 Opportunities

• Reduction of CO₂ emissions using energy-saving technologies developed by Tosoh and licensing of such technologies
• Wide range of chlorine products that contribute to sanitation management, such as hypochlorous acid soda and calcium hypochlorite
• Demand for PVC resin in Southeast Asia due to economic growth

 Threats

• Contracting market for chlor-alkali products in Japan
• Economic recession due to COVID-19 pandemic

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Objective

The Chlor-alkali Division, which handles commodity products, is easily affected by market conditions. However, we aim to build a stable revenue base by continuing full production and sales from our electrolysis plants and maintaining a balance between caustic soda and chlorine production.

In addition, with the current trend toward a decarbonized society, the roles and expectations of our company have heightened. Caustic soda is indispensable for the production of cathode material for EV batteries, which can reduce the burden on the environment, and is required to be of higher quality than before. By responding to these demands, we will contribute to the sustainable development of society.

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Growth Strategy

In Southeast Asia and other overseas markets, we expect demand for chlor-alkali products to grow steadily at a rate of several percent per year.

To ensure that we can meet market demand and support economic development in each country, we will make the necessary capital investments, including updating plant facilities and developing logistics infrastructure in Asia, to establish a stable supply system.

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Message from the Senior General Manager

Caustic soda and chlorine handled by the Chlor-alkali Division are used in a variety of fields, including the production of paper, artificial fiber, and alumina. These products are vital for the development of industry and society and the maintenance of living standards, as well as in the purification of PVC resin and tap water.

We operate the largest electrolysis facility in Japan, which enables us to continue to provide a stable supply. We will also develop a supply system for overseas markets where further demand is expected, thereby meeting the requirements of our customers.

Hideyuki Obayashi
Vice President
Senior General Manager, Chlor-alkali Division

Polyurethane is used in a wide variety of applications, including automobiles, home appliances, housing, and industrial materials. It contributes to energy conservation and weight reduction which contributes to better performance of EVs.

SWOT Analysis

Strengths

• Efficient integrated production system leveraging our vinyl isocyanate chain
• Lineup of products with distinctive functional capabilities
• R&D system able to respond to market needs

Weaknesses

• Business scale inferior to competitors
• Product mix dominated by isocyanates

Opportunities

• Strong growth in polyurethane market
• Social environmental demands such as carbon neutrality
• Proximity to China, the largest demand center, and Southeast Asia and India, where demand is expected to grow in the future

Threats

• Gradual decline in polyurethane market due to increased competitiveness of other resins
• Intensifying competition due to further capacity expansion by competitors
• Cost increase due to enhanced environmental responsiveness and deterioration of logistics situation

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Objective

The Urethane Division supplies the world with high-quality products created by leveraging manufacturing technologies and product development capabilities cultivated over many years. Our products are used in a variety of applications, including automobiles, construction, household goods, clothing, and industrial materials, and are indispensable to society.

In recent years, as global environmental awareness has heightened, environmental issues such as reducing CO₂ emissions have become an even greater challenge. We will promote the development of environment-friendly products and aim to reduce CO₂ emissions by establishing manufacturing processes that can effectively use CO₂ as a raw material and by improving existing manufacturing processes.

Through technological innovation, we hope to proactively address these issues and provide products that help solve social environmental concerns.

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Growth Strategy

In order to stabilize and maximize profits, we will continue to strengthen the foundation of MDI and improve its competitiveness and profitability. This will help ensure stable operation of the vinyl isocyanate chain through maximizing sales while producing at full capacity.

We will aggressively invest in growth areas centered on functional urethanes to expand the scale of our business.

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Message from the Senior General Manager

The Urethane Division handles a wide range of products, from commodity products such as MDI to specialty products developed in response to user needs. This division is the embodiment of our company's dual management, the aim of which is to generate stable profits from commodity products and high profits from specialty products.

Recently, the Japanese government declared that it aims to achieve a carbon-neutral society by 2050. We believe that our business has great potential in the use of CO₂ as a raw material, and that we can not only pursue higher profits but also contribute to society by helping reduce environmental impact.

Takafumi Kiuchi
Vice President
Senior General Manager, Urethane Division