Kaneka Gives Texas Gulf Coast an Extreme Makeover from Petrochem to Biochem with Construction of $80 Million Nutritionals Plant

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Researched by Industrialinfo.com (Industrial Information Resources, Incorporated; Houston, Texas). In an area long known for its abundance of petrochemical plants, there's a healthy new kid on the block. Spurred by skyrocketing demand for the natural antioxidant Coenzyme Q10 (CoQ10), Kaneka (Osaka, Japan) formed a new subsidiary, Kaneka Nutrients LP (Pasadena, Texas) and decided to invest in the construction of an $80 million manufacturing plant in Pasadena, Texas.

CoQ10 is used both as a nutritional supplement and as an ingredient in cosmetics, with almost a daily flurry of new reports being released hailing its effectiveness in battling a multitude of maladies spurred by age and disease. The body naturally produces CoQ10, but production of the chemical begins to drop sometime after the age of 20. Various research studies have shown that by replacing it in measured doses a person can prevent damage to collagen and elastin production, which in plain speak means less wrinkles. Along with claims of protection against cancer and a slowing of the progressive deterioration associated with Parkinson's and multiple sclerosis, the supplement is now being used by some to combat the side effects of muscle aches and the fatigue often incurred by use of the extremely popular statin drugs, which are prescribed for the treatment of high cholesterol.

The U.S. is the largest market for CoQ10 and is estimated to consume almost two-thirds of the world's yearly production, which was approximately 150 metric tons in 2003. Annual sales of the nutrient in the U.S. are placed above $200 million. To meet the increasing demand for CoQ10, earlier this year Kaneka announced a $33 million expansion that would double annual production of the nutrient at its Takasago, Japan (Hyogo Prefecture) plant to 150 metric tons.

With a global demand for CoQ10 forecast to double in the next few years, the company began construction in November 2004 on the new plant in Pasadena. But, with the growing popularity of the nutrient showing no signs of abatement, Kaneka then decided to quickly proceed with yet another $23 million expansion of their Takasago plant that should be complete in October of 2005, increasing production to a total of 180 metric tons. Kaneka currently supplies over 60 percent of the CoQ10 consumed in the U.S.

The $80 million Texas plant will initially produce 100 metric tons when it opens in 2006, with plans for successive expansions as demand increases. This will be one of the first facilities located outside of Japan to produce CoQ10.

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