Polypropylene
Hyosung is building an additional plant to manufacture polypropylene (PP), which is used in producing plastic containers, drain pipes, and medical syringes. In order to do so, the company will get a process technology from a global chemical leader.
According to industry sources on Sept. 20, Hyosung will invest about 150 billion won (US$129.09 million) to build the PP 3 plant with an annual production capacity of 200,000 tons at the Yongyeon 1 plant site in Ulsan by 2017. The company has already started the construction in July, and will complete it as early as the first quarter of 2017.
Hyosung made the decision because it has extended its dehydrogenation (DH) plant, which will start operating from the second half of this year, and the demand for PP has increased by more than 300,000 tons annually. Accordingly, the company has also decided to boost the production of PP.
Hyosung has invested a total of 280 billion won (US$241 million) to construct the DH plant in its Yongyeon plant from the end of 2013. The company has decided to extend the production line, since it believes that its profitability will improve in the future due to the decrease in the price of propane, the raw material of polypropylene, from the shale gas development in the U.S.
Once the PP plant is completed, Hyosung will secure a production capacity of more than 500,000 tons at existing 300,000 ton production facilities. In particular, polypropylene from the recent DH plant can be injected into PP so that its price competitiveness will be strengthened.