Mitsubishi Chemical Group revises investment plan for EVOH resin

According to the company, SoarnoL™, developed using proprietary technology from Mitsubishi Chemical Corporation, is an EVOH resin with gas barrier properties, oil resistance, and clearness. When used in food packaging, it is described as helping to preserve flavor and quality for longer periods, which the company says can contribute to reducing food waste. MCG also notes that the material can be processed into thinner layers compared to some alternatives, potentially lowering overall plastic usage. The company reports that global demand for such materials is increasing.

MCG had been investing to expand annual production capacity for SoarnoL™ in the United Kingdom by 21,000 tons. However, the company indicates that the project has involved irregular construction work due to design and operational constraints. It adds that these factors have resulted in complex contracts and management structures, contributing to delays at multiple stages and requiring additional safety assessments. As design and site-specific estimates were refined, MCG states that projected construction costs increased beyond initial expectations, partly due to higher material and labor costs linked to recent global inflation. The project timeline has also been delayed.

In response to these developments, MCG has increased the overall investment amount. The company expects this revision to affect profitability, as outlined in its disclosure on the impact on business performance. The new manufacturing facility is now scheduled to begin operations in fiscal 2027.

Under its management plan, “KAITEKI Vision 35,” MCG identifies food quality preservation as a focus area. The company positions SoarnoL™ as part of this strategy and states that it will continue supplying materials intended to support food preservation.

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Following the revision of its investment plan, Mitsubishi Chemical Group Corporation (MCG) expects a decline in profitability. The company stated that it will recognize an impairment loss on SoarnoL™-related fixed assets, including investment-related expenses incurred to date. MCG estimates this impairment loss at approximately 30 billion yen for the fiscal year ended March 31, 2026.

MCG also noted that this impact was not included in its consolidated earnings forecast for the fiscal year ended March 31, 2026, announced on February 5, 2026. The company said it is currently reviewing its consolidated financial results for the same period, including the effects of the revised investment. It added that any required updates to the earnings forecast will be disclosed once finalized.