Denka says all options open for US chloroprene rubber operations

Tokyo - Denka Co. has identified its mothballed chloroprene rubber plant in LaPlace, Louisiana, as one of four key earnings challenges to be addressed under its medium-term management plan through 2030.

The company is considering all strategic options for Denka Performance Elastomer (DPE), including a possible transfer or asset sale, said Denka in its 2025 integrated report published 30 Sept.

The Tokyo-based group said it aims to strengthen its earnings power by transforming its business portfolio and resolving four major earnings issues, one of which involves the DPE plant.

In order to “break out of this performance slump,” Denka said it is focusing on “a fundamental reform” of its chloroprene rubber business in the US.

“We are focusing on reforming our portfolio and are therefore taking targeted measures to steadily progress, while carefully considering all options, including the possibility of transferring the business and assets,” it added.

The company suspended its operations at the Louisiana plant in May, citing “rising costs, declining production, and weaker global demand” as key factors behind the decision.

DPE’s operations were also been burdened by “higher-than-expected design and installation costs” for emissions-reduction equipment, higher energy prices, and inflation-driven increases in raw material and maintenance costs.

Denka added that securing and retaining plant staff had become increasingly difficult, while emissions-control requirements constrained operations and disrupted the supply chain.