Possibility of Delaying 2026 Commercialization Plan Increases
"Industry Downturn... Taking a Cautious Approach to Investment"
Kumho Petrochemical plans to delay the production timeline for recycled styrene monomer (RSM). Previously, Kumho Petrochemical had announced plans to commercialize RSM, an eco-friendly raw material, starting in 2026, but due to slower-than-expected growth in demand for recycled products, the company has decided to adjust its production schedule. RSM is a raw material used in the production of synthetic rubber, Kumho Petrochemical's main product.
Workers at Kumho Petrochemical Yeosu Plant No. 2 are performing the final inspection of synthetic rubber products.
A Kumho Petrochemical official stated on the 19th regarding the RSM production timeline, "Commercialization in 2026 has become difficult," adding, "Like other chemical companies that are postponing or suspending investments, we are also taking a cautious approach." Kumho Petrochemical had previously announced its RSM business promotion plan in 2021, aiming to increase the production of eco-friendly products. The company intended to collaborate with global firms such as France's Technip Energies to apply RSM to high-performance synthetic rubber (SSBR). RSM is an eco-friendly raw material obtained by pyrolyzing waste polystyrene and is mainly used as a material for synthetic rubber and synthetic resins. Polystyrene is a type of plastic commonly encountered in daily life, such as in food containers, and the company planned to use it as a raw material for SSBR production.
Kumho Petrochemical's decision to delay the production of eco-friendly raw materials is due to the slower-than-expected implementation of eco-friendly policies and the demand for recycled materials not increasing as rapidly as anticipated. Additionally, the overall sluggishness in the petrochemical industry has also made the company hesitant to invest. Kumho Petrochemical is considered a company with relatively good performance compared to its peers. Last year, it achieved an operating profit of 272.8 billion KRW, driven by strong synthetic rubber sales aligned with tire replacement cycles.
A company representative said, "There needs to be significant demand for recycled materials to justify investment, but at this point, that is not the case."
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