"The reform in our business portfolio marks a shift towards a customer-driven model, underwritten by strong demographic factors that make ASEAN the fastest growth-region from a chemicals demand perspective."
Could you give us a brief understanding of MCAP’s structure and footprint in the Asia Pacific?
Mitsui Chemicals Asia Pacific (MCAP) is one of the regional headquarters for Mitsui Chemicals, Inc. (MCI), alongside other headquarters like Mitsui Chemicals America (MCA), Mitsui Chemicals Europe (MCE), and Mitsui Chemicals China (MCCN). In Asia Pacific, we have 23 affiliates, which are independent of MCAP and spread across Singapore, Malaysia, Thailand, Indonesia, and India. Though MCAP acts as a functional HQ, each company is autonomous and links back their business plans to Tokyo HQ.
In Singapore, there are five group entities besides MCAP: Mitsui Phenols Singapore (MPS); Mitsui Elastomers Singapore (MELS); our packaging business, Prime Evolue Singapore (EVLS); Mitsui Chemicals Singapore R&D Centre (MS-R&D), which is the only research and development facility outside of Japan, also house our Technical Support members. Our role at MCAP is to provide support to our affiliates, driving the enhancement of our global corporate governance policies across the region. In this sense, we provide Human Resource, Information Technology, and other selected administrative services to the Asia Pacific affiliates.
How did MCAP’s different businesses segments performed in 2020, and how do you mobilize for the future?
Over 90% of our manufacturing activities in the Asia Pacific fall under mobility and food & packaging, but we have been looking to increase our business share in healthcare, as well as placing a higher-focus on R&D-centered, next-generation businesses. Over the years, we have progressively diversified our portfolio from a petrochemicals-base to specialty chemicals like specialty polymers and healthcare ingredients, ramping up production in these two categories. The reform in our business portfolio marks a shift towards a customer-driven model, underwritten by strong demographic factors that make ASEAN the fastest growth-region from a chemicals demand perspective.
Looking at Mitsui Chemicals Group’s business performance, sales for the mobility market was expectedly down, due to stagnations in production. At the same time, profits in our basic chemicals business sector dropped due to the decline in Naphtha prices after the shock in the oil price earlier in the year. Nevertheless, sales for products targeted for hygiene and healthcare industries did well, driven by high demand for masks, medical gowns, and the food packaging.
What is MCAP’s stance on climate-action and ESG?
At a global level, Mitsui Chemicals Group has committed to becoming carbon neutral by 2050 - in following with international treaties and developments like the United Nations Sustainable Development Goals and the Paris Accord - but also driven by a commitment to contribute to the bettering of society and the protection of the environment. By 2030, we hope to have already reduced greenhouse gas emissions by half, as an interim plan. Globally, Mitsui Chemicals Group is one of the founding members of the Alliance to End Plastic Waste (AEPW). In supporting our commitment to end plastic waste, over the last couple of years in Singapore we were involved with different activities and sponsorships such as a reef installation, beach clean-up, and others. Though the pandemic has impeded us from running these initiatives in 2020, we hope to resume such activities this year.
MCAP announced a new Sustainable Packaging website in March 2021. Could you share what this covers?
Our Sustainable Packaging Site brings together the different sustainable packaging products sold by MCAP and is dedicated to customers in the food packaging industries to facilitate their experience in browsing the best solutions for their requirements. The new website categorizes our sustainable solutions into three divisions: sustainability (including recycling, food waste reduction, bio-based products, or solutions to reduce plastic use); quality of life (including shelf life extension or user-friendly packaging); and cost optimization (including less plastic use and higher processability). It also includes a special section for our mono-material packaging solution, made of 90% polyethylene (PE) or polypropylene (PP), structure which enables easy recycling.
What are your objectives in the next two years?
For the 2021 financial year, we are poised for better performance, and we expect recovering demand for our key products. Global developments such as the volatility in the price of crude oil, or the trade and diplomatic dynamics between China and the US will likely have some effect on the industry’s trajectory.
We have two missions at MCAP: the first is to accelerate our regional expansion strategy to Thailand, Vietnam and Indonesia; expansions which were unfortunately hindered by COVID-19 last year. The second is to successfully drive our services in these emerging markets earlier mentioned. As we prepare for a post-COVID-19 society, we want MCAP to lend valuable support to the APAC businesses and continue to represent high-quality across all our products and services.