This photo provided by S-Oil Corp. on April 29, 2021, shows its petrochemical plant
SEOUL, Jan. 16 (Korea Bizwire) — With the recovery of demand remaining sluggish due to the current economic slump, South Korean petrochemical companies are moving heaven and earth to survive through a reduction in output while lowering its factory utilization rate even further.
According to industry sources, the naphtha cracking center (NCC) utilization rate of the nation’s petrochemical sector is currently estimated at around 60-70 percent.
LG Chem Ltd., South Korea’s top chemical producer, resumed operations late last year after extending its regular maintenance period from 45 days to 60 days, but its facility utilization rate fell to a level below last year’s 80 percent.
As for Yeochun NCC Co., the regular repair period that was originally scheduled to be completed by the end of last year is set to be extended to late February of next year.
The spread between ethylene and naphtha stood at US$66.75 per ton as of Friday, lagging behind the level seen during the global financial crisis in 2008, according to the Ministry of Trade, Industry and Energy.
The spread has remained below the break-even point of $300 per ton for eight straight months starting from April of 2022, resulting in monthly losses of about 100 billion won (US$81 million) for related industries, industry sources said.
J. S. Shin (js_shin@koreabizwire.com)
