KH Neochem Co., Ltd. has announced its decision to halt the production and sales of specific solvents at its Yokkaichi Plant by December 2025. The solvents affected by this move are primarily used as raw materials in the production of paints and inks. Despite ongoing efforts to enhance production efficiency, the company has faced significant challenges due to factors such as sluggish demand recovery, rising raw material costs, and increasing fixed manufacturing expenses. As a result, the company has determined that maintaining the necessary profitability for the long-term sustainability of this business is no longer achievable.

The impacted products include Methyl Isobutyl Ketone (MIBK), Diisobutyl Ketone (DIBK), Diacetone Alcohol, Ethylene Glycol Monobutyl Ether Acetate, and Diethylene Glycol Monobutyl Ether Acetate, all of which are produced at the Yokkaichi Plant. The company has set a target to discontinue production and sales of these products by December 2025.

Despite these challenges in the solvent sector, KH Neochem is committed to transforming its business portfolio and advancing its Sustainable Management initiatives. The company aims to contribute to a more sustainable society by focusing on the development and supply of unique materials that are essential to global industries. These efforts are part of a broader strategy to ensure the continued growth and enhancement of the company’s corporate value while addressing the evolving demands of the market.

The decision to discontinue these solvent products marks a shift in KH Neochem’s business approach, aligning with its broader vision of sustainable growth and innovation. By strategically pivoting away from less profitable areas, the company is positioning itself to focus on future-oriented, high-value materials that will play a crucial role in various industries worldwide. This move reflects KH Neochem’s dedication to achieving long-term success while responding proactively to the changing dynamics of the business environment.

KH Neochem Co., Ltd., established in December 2010, is a leading manufacturer and seller of petrochemical products, with its predecessor Kyowa Yuka founded in 1966. Headquartered in Tokyo, Japan, the company operates with a capital of 8.8 billion JPY and employs 831 people. KH Neochem specializes in performance materials, electronics materials, and basic chemicals. Its main products include refrigeration lubricant raw materials, cosmetics ingredients, high-purity solvents for semiconductors and flat panel displays, and solvents for coatings and inks. The company also operates subsidiaries, including Kurogane Kasei Co., Ltd., Kurogane Fines Inc., and KH Neochem Americas, Inc.