Bangkok – SCG Chemicals, or SCGC, a prominent leader in the chemical sector, has unveiled a series of proactive short- and long-term strategies meticulously designed to bolster its competitiveness and strategically capitalize on the anticipated recovery of the regional petrochemical market. Spearheaded by Sakchai Patiparnpreechavud, Chief Executive Officer and President of SCG Chemicals Public Company Limited, the company expresses robust confidence in its capability to navigate and respond effectively to all prevailing market situations. A central pillar of this strategic thrust is the intensified development of High Value-Added Products & Services (HVA) and innovative Green Polymers. Furthermore, SCGC is dedicatedly accelerating its significant LSPE project in Vietnam, which is on track for completion by the end of 2027, underscoring its commitment to long-term growth and regional leadership.
Sakchai Patiparnpreechavud offered insights into the current market dynamics, stating, “The petrochemical market moves sideway, as evidenced by the product spread (product-to-feedstock price), which has stayed consistent from Q4/2024 through Q1/2025. The ongoing trade war between the United States and China has provided short-term benefits due to declining oil prices. Nevertheless, the situation requires continuous close monitoring, as policies may change unexpectedly. In recent months, several producers have reduced their production capacity due to high operating costs, resulting in the product spread not declining further and expected the petrochemical cycle has already at rock-bottom level.” This producer discipline, while born out of necessity due to cost pressures, has inadvertently helped to stabilize the market spreads, preventing a more precipitous decline.
Elaborating on the market’s recent history, Mr. Patiparnpreechavud noted, “The current petrochemical cycle has been notably more severe and prolonged than previous trough, driven by several factors including the COVID-19 pandemic, fluctuations in oil prices, the global economic slowdown, geopolitical tensions, and the transition of certain countries from importers to producers and exporters.” These multifaceted challenges, ranging from unprecedented global health crises and energy market volatility to significant shifts in global trade patterns and manufacturing footprints, have collectively contributed to a uniquely demanding operational environment for the petrochemical industry worldwide.
Despite these formidable headwinds, SCGC has demonstrated remarkable agility and foresight. “Nevertheless , SCGC remains resilient in managing these challenges by continuously adjusting its business strategies in response to the changing market environment,” Mr. Patiparnpreechavud emphasized. This adaptive approach is crucial for sustained success. “The company emphasizes proactive approaches both in the short-term and the long-term to enhance competitiveness and create sustainable growth opportunities.” This dual focus ensures that SCGC not only weathers immediate market storms but also positions itself strategically for future prosperity and industry leadership.
To address the immediate market realities and lay the groundwork for future expansion, SCGC has outlined a comprehensive suite of short-term strategies. Mr. Patiparnpreechavud detailed these initiatives: “The short-term strategies include: 1) reducing feedstock costs, working capital, and expenses through the implementation of digital technologies and AI; 2) accelerating the development of High Value-Added Products & Services (HVA) and Green Polymers; 3) rapidly expanding comprehensive service solutions; and 4) expanding the PVC fabrication business.”
The integration of digital technologies and Artificial Intelligence into operations is particularly aimed at optimizing resource allocation, streamlining processes, and unlocking new efficiencies, thereby directly impacting the bottom line. The concerted push towards HVA and Green Polymers reflects a strategic pivot towards higher-margin, technologically advanced products that meet evolving customer demands for performance and sustainability. Expanding service solutions and the PVC fabrication business, meanwhile, allows SCGC to diversify its revenue streams and capture additional value across the petrochemical value chain.
Complementing these immediate actions is a robust long-term strategy centered on enhancing foundational competitiveness. “The long-term strategy by enhancing ethane feedstock at the LSP plant in Vietnam (LSPE Project), by lowering feedstock cost and elevate SCGC’s long-term competitiveness,” added the Chief Executive Officer and President of SCGC. The LSPE Project is a cornerstone of this vision, designed to secure a cost-effective and reliable supply of ethane, a key raw material. This strategic investment in Vietnam is expected to significantly reduce production costs and provide SCGC with a distinct competitive advantage in the years to come, particularly in the olefins and polyolefins segments.
A significant element of SCGC’s competitive edge lies in its HVA portfolio. “High Value-Added Products & Services, or HVA, remain a key strength for SCGC, underpinned by continuous innovation to address everyday consumer needs as well as requirements across industries, including polymers for food packaging, automotive components, structural work, and building materials,” stated Mr. Patiparnpreechavud.
This commitment to innovation ensures that SCGC’s HVA offerings remain at the forefront of technological advancement, providing tangible benefits such as enhanced durability, lighter weight, improved safety, and greater processing efficiency for its customers. “Notably, despite the ongoing petrochemical trough, the HVA segment continues to be well-accepted in the regional market,” he further observed, highlighting the resilience and strong demand for these specialized products even in a subdued market environment. This enduring appeal underscores the true value and differentiation that HVA products bring to diverse applications.
Parallel to its HVA focus, SCGC is making substantial strides in the realm of sustainable solutions. “In addition, SCGC is accelerating the development of environmentally friendly polymers marketed as SCGC Green Polymer,” Mr. Patiparnpreechavud announced. “These products are certified by the internationally recognized Global Recycled Standard (GRS), and produced using advanced recycling technologies combined with proprietary formulations designed to meet diverse application needs, such as high-quality, odorless recycled plastic resin for packaging, as well as high-quality recycled plastic resin for automotive parts and electrical appliances.” The GRS certification provides customers with assurance regarding the recycled content and responsible production practices.
SCGC’s investment in advanced recycling technologies, coupled with its expertise in formulation development, allows the company to produce high-quality recycled resins that can substitute virgin plastics in demanding applications, thereby contributing to the circular economy. To further propel this green initiative, “SCGC also continues to expand collaboration with key business partners and leading brands, including Unilever, Lion, Kao, JBP, and HomePro.” These partnerships are instrumental in co-creating sustainable packaging and product solutions, driving market adoption of Green Polymers, and fostering a collaborative ecosystem for environmental stewardship.
Beyond its core product innovations, SCGC is strategically broadening its business horizons to unlock new avenues for growth and customer engagement. “SCGC is also expanding into new businesses to create growth opportunities and broaden its customer base,” the Chief Executive Officer and President of SCGC added. “An example of this expansion is the Industrial Service Solutions business, leveraging the company’s engineering and technological expertise in machinery management to develop new ventures.” This move capitalizes on SCGC’s deep in-house knowledge accumulated over decades of managing complex chemical plants.
“One notable initiative is the development of ‘DRS by REPCO NEX’ (Digital Reliability Service Solutions), the world’s first integrated smart digital solutions provider for industries. DRS offers comprehensive Asset Performance Management services, such as fully integrated smart digital maintenance, digital transformation, and digital platforms to support renewable energy management.” DRS by REPCO NEX aims to revolutionize industrial maintenance and operations by offering predictive analytics, AI-driven insights, and digitally enabled workflows, thereby enhancing operational efficiency, reliability, and safety for its clients, marking SCGC’s foray into the high-growth digital solutions space for industries.
Crucial to SCGC’s long-term strategic positioning is the LSPE project in Vietnam, and Mr. Patiparnpreechavud provided a positive update on its advancement. “Regarding the progress of the LSPE project, earlier this year, the company accelerated its efforts and successfully completed three significant milestones: 1) signing a long-term contract for ethane sourcing and an export terminal, 2) signing charter agreements for five Very Large Ethane Carriers (VLECs), and 3) signing an Engineering, Procurement, and Construction (EPC) contract for ethane storage tanks.”
These milestones are critical enablers for the project, securing the necessary feedstock supply, transportation logistics, and infrastructure development. The signing of a long-term ethane sourcing contract ensures a stable and predictable supply of raw materials, while the chartering of five VLECs provides dedicated shipping capacity. The EPC contract for ethane storage tanks marks a key step in the physical construction of the facility. “Currently, detailed work is proceeding according to schedule, with project completion expected by the end of 2027,” he concluded, reaffirming the timeline and SCGC’s commitment to this transformative project.
SCG Chemicals, or SCGC, stands as a leading integrated polymer and solutions provider with a steadfast commitment to sustainability. The company operates from strategic bases located in Thailand, Indonesia, and Vietnam, enabling it to serve the broader ASEAN region effectively. SCGC’s comprehensive portfolio encompasses a full range of petrochemical products, extending from the upstream production of olefins to the downstream manufacturing of three main plastic resins: polyethylene (PE), polypropylene (PP), and polyvinyl chloride (PVC). This vertical integration provides SCGC with significant operational synergies and control over its value chain.
At the heart of SCGC’s philosophy is a drive for impactful innovation. “SCGC focuses on inventing ‘Innovation That’s Real’ to drive the ASEAN economy and elevate the quality of life in accordance with ESG.” This motto reflects the company’s dedication to developing practical and meaningful solutions that address real-world challenges and contribute to societal well-being, all while adhering to stringent Environmental, Social, and Governance (ESG) principles. Furthermore, “SCGC develops technology and innovation toward High Value Added Products and Services (HVA), including environmentally friendly products and solutions in line with the Low Waste and Low Carbon approaches—such as eco-innovative polymers or Green Polymers under the SCGC GREEN POLYMER™ brand.” This twin focus on HVA and green solutions demonstrates SCGC’s commitment to both economic value creation and environmental responsibility. The SCGC GREEN POLYMER™ brand is a testament to its efforts in promoting a circular economy and reducing the carbon footprint of its products.
“These initiatives aim to meet diverse needs and align with megatrends across various sectors, including infrastructure, packaging, consumer goods, automotive, and energy solutions, while simultaneously promoting sustainable social and environmental stewardship,” underscoring the broad applicability and forward-looking nature of SCGC’s innovations. By aligning its product development with global megatrends such as urbanization, sustainable packaging, and e-mobility, SCGC ensures its continued relevance and growth in a rapidly evolving global landscape.
For further details on SCGC and its initiatives, more information can be found at www.scgchemicals.com.
#SCGC #Petrochemicals #HVA #GreenPolymer #Sustainability #Innovation #LSPEproject #Vietnam #ChemicalIndustry #ESG #DigitalTransformation #RECPONEX #MarketRecovery #EthaneFeedstock
