THE KOREA ECONOMIC DAILY, GLOBAL EDITION

South Korea’s LG Chem Ltd. has emerged as the world’s fourth chemicals producer, the second Asian company to be among the five largest and most influential chemicals makers globally, according to leading chemistry and chemical engineering news publisher Chemical & Engineering News (C&EN) earlier this month.

The top chemicals maker in Korea jumped from seventh place in 2022 to fourth last year with $42.3 billion in sales. It followed German chemicals giant BASF SE which logged $74.5 billion in sales, China Petroleum & Chemical Corp. (Sinopec) with $58.1 billion and Dow Chemical Co. with $44.6 billion.

C&EN categorized LG Chem’s business largely into three areas: biobased chemicals, nylon and battery materials.

The weekly magazine said that LG Chem will transform 400,000 metric tons of biomass per year into products such as feedstock for petrochemicals; make pentamethylene diamine, a raw material for nylon-5,10 with Korean food giant CJ CheilJedang Corp.; and is constructing $3 billion cathode material plant in Tennessee and will supply $19 billion worth battery cell materials to General Motors Co.

LG Chem has become the first Korean firm and the second Asian company after Sinopec to have joined the top five chemical makers. 

Korea’s Lotte Chemical Corp. ranked 27th, while Hanwha Solutions Corp. and SK Innovation Co. emerged as 47th and 50th largest chemical makers worldwide, respectively.

INDUSTRY DOWNTURN

C&EN said that the combined chemical sales of the top 50 firms declined by 10.7% to $1.04 trillion last year amid the industry downturn. It added that the COVID-19 rebound that buoyed the increase in 2022 waned last year, while an inventory correction that undermined sales volumes in addition to overcapacity caught up to the industry.

It explained that Europe’s severing of ties with Russia after the war with Ukraine cut the industry off from an abundant supply of natural gas and exacerbated the sector’s weakness.

Among the top 50 firms, combined profits for the 38 reporting the figures tumbled by 44.1% on-year to $54.4 billion in 2023. Of the 38 companies, 29 posted declines in their bottom lines and seven posted losses, the magazine said.

Three firms out of the top 10 chemical makers saw their sales increase in 2023. LG Chem’s sales increased 6.5% on-year; sales of global No. 5 company PetroChina Company Ltd. rose 3.4% to $40.9 billion; and the 10th-biggest firm Linde plc’s sales climbed 0.3% to $30.7 billion last year.

Write to Hyung-Kyu Kim at khk@hankyung.com

Jihyun Kim edited this article.