Kemira-Ube Ltd. and Asahi Denka Co., Ltd. have agreed to cooperate in the field of hydrogen peroxide. Both companies aim to increase operational efficiency by barter shipments and sharing logistic. Both also expect to yield a more stable supply capability and to enhance the competitiveness.
Asahi Denka operates a hydrogen peroxide plant in the city of Fuji in Shizuoka prefecture, with an annual capacity of 45,000 tons. This is backed up by five nationwide supply centers.Kemira-Ube holds annual production capacity of 22,000 tons of hydrogen peroxide at its plant in Ube. Through an alliance with one of its parent companies, Kemira Chemicals Inc., Kemira-Ube uses its own tanker to import approximately 34,000 tons of hydrogen peroxide annually from Kemira Chemicals Korea and supplies domestic customers from eight supply centers throughout Japan.
Demand for hydrogen peroxide has been climbing steadily. Driving this growth is the switch to chlorine-free bleaching by paper manufacturers and the increasing use of recycled paper. In addition, with rising demand from chemical companies, the demand-supply balance for hydrogen peroxide is projected to further improve in the future.
On the other hand, the price of hydrogen peroxide has been weak for the past decade. Prices at current level squeeze manufacturers' profit and prevent them from making new investments.
Through this alliance, Kemira-Ube and Asahi Denka will share hydrogen peroxide supplies and distribution facilities. Additionally, the agreement will help Kemira-Ube to more efficiently utilize its tanker, helping it to hold down rising transportation costs. This will make Kemira-Ube more competitive, ensure a more reliable supply for customers, and help the company for future investments in the hydrogen peroxide business.
