Shin-Etsu's US subsidiary Shintech has begun to construct a new integrated plant to produce polyvinyl chloride (PVC) from salt. The new plant will be on industrial site developed by the company, located next to the existing plant in Plaquemine, Louisiana.
Chiyoda/Japan — The company obtained permits to build a plant capable of producing 860 thousand tons per year of vinyl chloride monomer (VCM), the raw material of PVC, and 660 thousand tons per year of caustic soda, and has commenced construction of the first phase of the plan. The first phase will increase production capacity by 290 thousand tons of PVC per year and 270 thousand tons of caustic soda per year. The amount of this investment is expected to be $ 1.49 billion, which the subsidiary will fund by itself. Completion of the construction is targeted for the end of 2020. Annual production capacity after the completion of the first phase will be 3,240 thousand tons per year of PVC and 1,570 thousand tons of caustic soda per year.
Shintech, which commenced PVC production in the state of Texas in 1974, owns a vast amount of property in Plaquemine, Louisiana. Since the completion of the integrated PVC production plant in Plaquemine, Louisiana in 2008, the manufacturer has expanded and raised production capacity three times and is now building an ethylene plant. Meanwhile, world demand for PVC has increased almost in line with global GDP growth.
According to industry data, world demand for PVC reached 43 million tons per year in 2017. In the meantime, lagging PVC supply capacity compared to growth in demand increases the operation rate of PVC producing facilities. It is expected that this trend will continue in the future. Similarly, global demand of 77 million tons of caustic soda per year in 2017 has recently been outpacing supply, and this trend is expected to continue.