Seven Major Chemical New Material Giants: Sell-Offs, Shutdowns, and Layoffs!

On October 16, Daicel Corporation announced that it has decided to acquire all of Polyplastics Co., Ltd.'s businesses (excluding the shareholding and management businesses of its subsidiaries and affiliated companies) through an absorption-type merger starting from April 1, 2026.

Tianli announced that it will sell all of its 50% stake in LG Toray Hungary Battery Separator Kft. (LTHS) to LG Chem, with a transaction price of approximately 30 billion yen.

Recently, Dow Chemical announced that it will permanently close its polyether polyols production facility in Tertre, Belgium by the end of the first quarter of 2026. This move will affect 37 employees and 8 contractors, and the plant has an annual capacity of 94,000 tons.

This move was made by Dow following a strategic review of its European assets, with a focus on the polyurethane business. The demand for the European polyether polyols market is weak, especially from key end-use sectors such as automotive, home appliances, construction, and upholstered furniture. Overcapacity and rising imports (with an average annual import volume of 286,000 tons from 2020 to 2024, reaching a record 323,000 tons last year) have further challenged the competitiveness of European producers, with China, South Korea, and Saudi Arabia being the main sources of supply.

Although the Tertre plant has been closed, Dow still has an annual production capacity of 530,000 tons in Terneuzen, Netherlands, and 60,000 tons in Tarragona, Spain, which will ensure a continuous and uninterrupted supply to its customers.

The closure of the Tertre plant is part of Dow's broader rationalization plan in Europe. This plan also includes the closure of an ethylene cracker in Borken, Germany, by the end of 2027, as well as the chlor-alkali and vinyl assets in Schkopau, Germany; and the closure of a basic silicone plant in Barry, UK, by mid-2026.

Recently, INEOS announced plant closures and layoffs, totaling 235 job cuts.

• 60 employees laid off at the Hull factory in the UK.

• Closing two factories in Germany and laying off 175 employees.

On October 6, Trinseo announced a series of strategic plans aimed at further optimizing operations, enhancing cash flow generation capabilities, and strengthening long-term profitability.

• Close the MMA production facilities in Italy.

• Possible Closure of Polystyrene Production Facility in Germany

On October 2nd, synthetic rubber producer ARLANXEO plans to cease operations at its Port Jerome facility in France.

The Jerome Port plant has been in a state of structural loss. Despite many improvement efforts by the company, no viable path for sustained structural improvement is expected.

It is reported that Arlanxeo is a wholly-owned subsidiary of Saudi Aramco, with a production capacity of 100,000 tons per year of polybutadiene rubber (PBR) and 40,000 tons of styrene-butadiene rubber (SBR), and has a production facility in La Wantzenau, France.

It is worth mentioning that upstream, ExxonMobil closed its butadiene (BD) and cracking units located in Jerome Park last year, with a rated capacity of 90,000 tons/year of BD.

In summary, the four companies, Dow, INEOS, Solvay, and Lanxess, stated that the direct reasons for their shutdowns include not only the weak demand in the European end markets and high energy prices but also the increase in imports from Asia.

On October 8, INEOS announced that about half of Europe's ethylene production capacity will be shut down before 2030. Currently, 21 major chemical plants in Europe have closed, with a capacity of over 11 million tons, and more plants are expected to close. The overall chemical production in Europe is declining significantly, with a 30% decrease in the UK, an 18% decrease in Germany, and a 12% decrease in France.

Eight out of the top ten chemical companies in the world are reducing or exiting Europe, while the top ten producers in the United States are investing and expanding. China's chemical production has an average annual growth rate of 9%, and production capacity in the Middle East is also rapidly increasing.

Shockingly, the European chemical industry is being squeezed out of the global market due to its own high costs. Natural gas prices in Europe are four times higher than those in the United States, and with the high carbon taxes on the continent and tariffs in the U.S., the industry simply cannot compete with America.

In addition, Sir Jim Ratcliffe, the founder and chairman of INEOS, has called for urgent intervention from European politicians to save the chemical industry. "We are at a critical juncture and there are three issues that need to be addressed. Firstly, remove the green taxes from energy costs. Secondly, abolish the carbon tax. Thirdly, provide us with some tariff protection. What we need is action, not sympathetic words; otherwise, the European chemical industry will be left with very little."

Last month, Julia Schrenz, president of Dow's Europe, Middle East, Africa, and India region, stated that the European chemical and petrochemical industry is facing a "multiple crisis" due to weak domestic demand and a large amount of new capacity being built overseas.

Since 2023, the following companies and facilities have been shut down in Europe: