LG Chem plans Expansions to Support ABS Demand for Electronic Appliances and Automobiles

---

Researched by Industrialinfo.com (Industrial Information Resources, Inc.; Houston, Texas). One of Korea's largest chemical producers, LG Chem Limited (Seoul, South Korea), plans to increase production of Acrylonitrile Butadiene Styrene (ABS) to 1 million metric tons per year by 2006. According to Steve S.K. Lee, Vice President of LG Chem's Performance Polymers Business Division, China's demand for ABS is predicted to increase by 8.2% annually. A thermoplastic utilized in the electronic and automobile industries, ABS is very attractive due to its chemical resistance, moderate strength and inexpensive production cost.

In response to forecasted growth, LG Chem plans $104 Million (USD) in capacity expansions at its Ningbo (China) and Yeosu (Korea) locations. The Ningbo Plant will increase operating capacity from 150,000 tons per year to 370,000 tons per year. At the same time, the Yeosu Plant, currently producing 350,000 tons per year, will increase production to 430,000 tons per year, resulting in a total LG Chem ABS capacity increase of 500,000 tons per year by 2003. The additional product will be sold to the Chinese Market. According to Lee, this first stage of growth should increase LG Chem sales by $211 million (USD). In Phase two, both Ningbo and Yeosu Plants will raise capacity 130,000 tons per year and 70,000 tons per year respectively. These remaining increases will occur through upgrading existing production equipment and facilities. Stephen Rhoads, an International Chemical Research Specialist with Industrialinfo.com states, We are currently tracking $285 million (USD) in International ABS plant expansions in the planning or construction phases that represent over 300,000 tons per year of new capacity. An additional 1.3 million tons per year of ABS capacity is anticipated to be on-line by 2008.

LG Chem Limited is a leading vertically integrated chemical producer with a presence in Asia Pacific, North America, and Europe and had year 2000 annual sales of $3.3 billion with over 12,000 full-time employees. A producer of Petrochemicals, Performance Polymers, Information & Electronic Materials, Industrial & Building Material, LG Chem has manufacturing subsidiaries in China India, Indonesia, Korea, Thailand, and Vietnam.