Ube Industries to close caprolactam production at Sakai facility

TOKYO, JAPAN: Ube Industries Ltd will cease production of caprolactam at the Sakai factory in Japan. The decision will result in the company recording an extraordinary loss for the fiscal year ending 31 March 2013.

With the global economic slowdown starting in 2012, growth in demand for caprolactam has weaken while market conditions for caprolactam have been heavily eroded by the entry of new manufacturers and successive production expansion of existing manufacturers centering on Chinese companies, this made the company to close the factory. At the same time, prices for raw material benzene and auxiliary materials have risen, with the net effect that the profitability of the caprolactam business has rapidly declined.

Ube will continue to supply customers with the affected products from its other manufacturing facilities, endeavoring to make the transition as smooth as possible for customers to secure their supply for another manufacturer. Employees who are currently engaged in caprolactam production at the Sakai factory will be shifted to production for specialty products including separators for lithium-ion batteries, whose production is set to be expanded at the Sakai factory.

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