LG Chem enters top 10 global chemical firms

By Jun Ji-hye

LG Chem has entered the top 10 global chemical companies for the first time among domestic enterprises thanks to the growth of its electronic and battery materials business and brisk investment, the firm said Tuesday.

The chemicals and biopharmaceutical business unit of LG Group cited an annual survey of the global top 50 chemical companies conducted by the Chemical & Engineering News (C&EN), a magazine issued by the American Chemical Society, in which the company took the No. 10 position.

The magazine announced a list of global chemical companies after comprehensively considering their recent sales and operating profit.

Among Asian companies, China's Sinopec took the No. 3 spot, Taiwan's Formosa Plastic the No. 6 and Japan's Mitsubishi Chemical the No. 9.

Among Korean companies, Lotte Chemical ranked 22nd and SK Innovation 38th.

The magazine said LG Chem is planning a massive R&D expansion with its electronic and battery materials business segment growing.

“By the turn of the next decade, it wants to boost its R&D headcount by 800 to 6,300 people,” the magazine said. “It is also launching an innovation contest promising grants of up to $150,000 to scientists working in materials, biotechnology and other fields.

“On the capital spending front, LG and China's Zhejiang Huayou Cobalt are investing $450 million to set up a pair of Chinese joint ventures making cathode materials for electric vehicle batteries.”

Regarding the chemical arm of Lotte Group, the magazine said the firm is seeking to expand its business through a $3 billion ethylene joint venture with Westlake Chemical in Lake Charles, Louisiana, scheduled to start up during the first half of next year.

“The timing of the facility is just as the companies predicted when they broke ground in June 2016,” the magazine said. “Lotte is also constructing its own ethylene glycol plant in Lake Charles.”

Meanwhile, Germany's BASF maintains the top spot in C&EN's global top 50 despite the merger between Dow Chemical and DuPont, the magazine added.

The U.S.' DowDuPont ranked second while Saudi Arabia's SABIC and Britain's Ineos ranked fourth and fifth, respectively.

The magazine noted sales of global firms rose strongly and profits did even better, but added: “One storm cloud on the horizon is trade. Should the U.S. and China go through with a trade war and mark $200 billion in products for tariffs, the chemical industry _ particularly U.S. petrochemical makers _ could see an adverse impact.”