South Korea's petrochemical restructuring is moving from planning into implementation, bringing significant changes to the country's ethylene production landscape and potentially reshaping the broader Asian C2 market.
In Daesan, Lotte Chemical's 1.1 million metric ton per year naphtha cracking capacity is being taken offline as part of the restructuring involving Lotte Chemical and HD Hyundai. The integration marks one of the first major steps in South Korea's broader effort to reduce excess petrochemical capacity and improve the competitiveness of its domestic industry.
Further restructuring is underway in Yeosu. A government-approved plan involving Lotte Chemical, Yeochun NCC, Hanwha Solutions and DL Chemical is expected to idle another 1.39 million metric tons per year of ethylene capacity over the next three years. The plan also integrates upstream naphtha cracking operations with downstream polyethylene and resin businesses.
Together, the announced reductions in Daesan and Yeosu amount to approximately 2.49 million metric tons per year of ethylene capacity.