Mitsubishi Public Affairs Committee

Differentiate. And Coordinate

The Mitsubishi Monitor talks with Hideki Odaka, president of Mitsubishi Gas Chemical.

Mitsubishi Gas Chemical is a world leader in producing methanol from natural gas. Your product portfolio also includes commodity chemicals, such as ammonia, hydrogen peroxide and xylene, and specialty chemicals, such as BT resin for printed circuit boards. Your Ageless oxygen absorber is a market leader in products for keeping packaged foods fresh. Where do you go from here? What kind of company do you want Mitsubishi Gas Chemical to be in 5 or 10 years?
We are concentrating on two main strategic priorities. One priority is to focus our business on product categories where we can differentiate our offerings advantageously from competitors'. The other priority is to coordinate management better among the companies in the Mitsubishi Gas Chemical Group to strengthen our overall competitiveness.

Does your emphasis on differentiation mean exiting markets for commodity chemicals?
It means focusing especially on fine chemicals, on materials for the electronics industry and on other high-value-added products. Commodity chemicals will remain an important part of our product portfolio. But our business will grow more rapidly in high-value-added products.

What do you mean by coordinating management better among group companies?
Until recent years, Japan's business media and Japanese shareholders were interested mainly in nonconsolidated, parent-company financial performance. Consolidated, group results were a secondary consideration. That has changed as escalating competition has obliged managements to employ assets more efficiently and as globalization has obliged us to adopt more-transparent accounting practices. At Mitsubishi Gas Chemical, we are working to optimize our operations in the context of overall, group performance.

  The president exhibits two examples of food packaging that contains Mitsubishi Gas Chemical products. High-tech nylon from the company helps retain the fizz in carbonated beverages. And Mitsubishi Gas Chemical's oxygen-absorbing Ageless appears as a thin laminate in a growing range of food-packaging bags.
What technological strengths underlie the Mitsubishi Gas Chemical Group's performance in the global marketplace?
Our strengths are highly distinctive and highly competitive. A very fundamental strength is our technological momentum as the industry pioneer in producing methanol from natural gas. Another important strength is our expertise in electronics-related technologies, such as garnet crystals, printed circuit boards and semiconductor cleansing agents.
   The Ageless product line evidences another technological pillar of our business. Based on the oxygen affinity of iron powder, Ageless preserves freshness by preventing oxidation and by preventing the growth of fungi and aerobic bacteria. It originally appeared as packets in packages, and that remains the most common application. But we also have begun supplying Ageless as a laminate for food-packaging bags. I should mention that we supply Ageless for packaging electronic components, too.

Geography is another strength for you, isn't it?
We have built plants outside Japan for three very different reasons. One reason is proximity to supplies of natural gas. We own equity stakes in plants in Saudi Arabia and Venezuela that convert natural gas into methanol. And we participate in methanol production ventures in a nonownership capacity in other nations where natural gas is plentiful.
   A second reason for globalizing production is cost-competitiveness. Japan's high-cost environment is unsuited to production of some commodity products. Our customers have shifted some of their production to other Asian nations. And we have built plants in Southeast Asia and in other regions to serve them with high-quality, cost-competitive raw materials.
   Our third main reason pertains to technology and product strategy. We are making the most of our strengths in selected high-value-added products by producing those products locally in principal markets. A good example is MX Nylon. That material offers excellent strength and good formability. It also offers superior gas barrier characteristics. In bottles for carbonated beverages, that helps retain the carbonation. We are the only producer of MX Nylon in the world. And we are building a plant in the United States to complement our MX Nylon plant in Japan.

Your company has an interesting history.
Yes. Mitsubishi Gas Chemical arose through the 1971 merger of Mitsubishi Edogawa Chemical and Japan Gas Chemical. The former had been established in 1918 to supply barium to a Mitsubishi company that made paper, and it subsequently had developed various chemicals, including hydrogen peroxide. The latter was founded in 1951 as the first Japanese company to produce methanol from natural gas. Both of our founders were highly technology-intensive enterprises.
   We are proud to add an important facet to the vast range of services and products available from the Mitsubishi companies. And we are grateful for the benefits that we enjoy by virtue of bearing the Mitsubishi name. Mitsubishi Gas Chemical is a smallish company by the standards of the global chemical industry. But wherever we go in the world, we can dispense with self-introductions. The name says it all.