Why did INEUS give up the European phenol ketone market? A prelude to the big adjustment of the phenol ketone industry structure?

On June 17, 2025, INEES Phenol announced that it plans to permanently cease production at its Gladbeck plant in Germany on a date to be determined. The world's largest producer of phenol and acetone. The device area is one of several large-scale production bases of Ineos phenol in the world. It is the core base of Ineos in Europe. The downstream products cover high-end fields such as auto parts, electronic resins and building materials.

The phenolic ketone plant in Gladbeck, Germany, is a landmark facility in the global phenol and acetone production field. The plant was built in 1954 and has long maintained the status of the world's largest single set of phenol production plant. Its technical process, production capacity scale and strategic layout have a profound impact on the global phenolic ketone industry chain. The plant has a phenol production capacity of 650000 tons/year, accounting for about 35% of the total European production capacity of Inox, and a acetone production capacity of 409000 tons/year. By-products include α-methylbenzene, acetophenone and other products.

Why did INEES abandon the European phenol ketone market? How might the global phenol ketone industry structure be adjusted?

It is understood that INESS has four major phenolic ketone production bases in the world, located in Europe, the United States and Asia, of which Europe has two phenolic ketone factories, Antwerp in Belgium and Gladbeck in Germany, of which Antwerp in Belgium has a production capacity of 680000 tons/year and is equipped with 415000 tons/year acetone plant. After the German Gladbeck plant is shut down in 2025, there is a high probability that phenolic ketone production capacity will be transferred to Antwerp, Belgium.

In addition, Inox has a 850000-ton/year phenol plant in Mobile, USA, with a by-product of acetone of 520000 tons/year. The plant adopts heat integration technology to reduce carbon emissions. Ineos has a 310000-ton/year phenol plant and a 185000-ton/year acetone plant in Jurong Island, Singapore, Asia. Jurong Island is the main consumer market for its products.

According to incomplete statistics, the total global phenol production capacity of INEUS is about 2.49 million tons, accounting for about 18% of the global total, and it is the world's largest phenol ketone producer.

according to statistics from Pingtou Ge, as of the end of 2024, the global production capacity has exceeded 14 million tons, of which China is the world's largest producer of phenolic ketone, with a production capacity exceeding 4 million tons, accounting for about 30% of the global total production capacity. The second is the United States, which accounts for about 22% of the world's total production capacity.

With the continuous production of China's large refining enterprises, the scale of China's phenol ketone plant has grown rapidly in recent years, and it has become the world's largest phenol ketone producer. In 2024, China's new production capacity will exceed 600000 tons, the rapid growth of China's production capacity has led to a shift in the global supply pattern, which has greatly reduced the industry influence of Inox's global phenolic ketone plant..

According to the output rate of China's theoretical phenolic ketone plant and the mainstream unit processing cost of the industry, the theoretical profit margin fluctuation of China's phenolic ketone plant from 2009 to 2025 is calculated. As can be seen from the figure, starting from 2010, the theoretical profit margin of China's phenolic ketone plant shows a trend of shock and shrinkage, especially after 2020, which highlights the decline of the prosperity of the phenolic ketone industry.

By the end of 2024, the theoretical profit margin level of China's phenol ketone plant had fallen to -5 per cent and to -5.5 per cent in January-June 2025. The decline in the theoretical profit margin of phenolic ketone devices is, on the one hand, the deterioration of the competitive environment brought about by market competition and the continuous decline in market prices. On the other hand, the raw material products remain high, which greatly reduces the production profit space. The poor economy of the phenolic ketone plant may be one of the main considerations for Inox to choose to abandon the old plant.

the rising cost of production in the European chemical industry may also be a key consideration for INEUS to abandon the device. The price of natural gas in Europe soared to an all-time peak from 2022 to 2024, and the cost of natural gas power generation increased significantly, with the highest power generation price reaching 300 euros/MWh, resulting in phenol production costs 50%-80% higher than those in Asia, making it impossible to compete in the global phenol and ketone industry.

In addition, the cost of the EU carbon border adjustment mechanism and Germany's local carbon tax is about 30 euros/ton of carbon dioxide, which is significantly higher than the cost of carbon tax in China and other Asian countries, which increases the production cost by 2%-5%.

The shrinking of the European consumer market is also an important consideration for Ineos to abandon the European market. European bisphenol A and epoxy resin enterprises to Asia, such as the closure of the German Gladbeck plant, including 150000 tons/year bisphenol A plant and 100000 tons/year liquid epoxy resin plant. Dow Chemical plans to close the Stade propylene oxide plant in Germany and optimize other high-energy-consuming devices in Europe to promote the shift of epoxy resin production to Asia. Lian de Basser and Liaoning Bora Group jointly built a $12 billion petrochemical project, including 1.1 million tons/year ethylene cracking plant and downstream polyolefin, styrene and other products, although not directly closed the epoxy resin plant, but through technology licensing and joint ventures to transfer capacity to Asia. LANXESS will transfer its epoxy business to Asia through technology transfer or joint venture. South Asia Plastics plans to build the largest epoxy resin production base in South Asia in India, with an annual production capacity of 450000 tons.

In addition, Mitsui Chemicals 2025 6 on April 24, Mitsui Chemicals announced that, the board of directors has formally decided to transfer all 50% of the shares held by Sinopec Mitsui Chemical Co., Ltd. (SSMC) to Shanghai Gaoqiao Petrochemical Co., Ltd., and the transaction is expected to be completed in October 2025. The transfer of Sinopec Mitsui Chemical Co., Ltd. was established in April 2006, mainly producing phenol, acetone and bisphenol A and other basic chemical products. The business led to a huge loss of Mitsui Chemicals, which is the main reason for Mitsui Chemicals to give up.

The global phenol ketone industry is undergoing a historic transformation from Europe and the United States to the rise of Asia. Inox chose to abandon the German market, which is the key to the international leading enterprises. Strategic adjustment is also a signal of the structural adjustment of the global phenolic ketone industry. for chinese enterprises, while consolidating advantages in scale, it is also necessary to accelerate technological upgrading and international layout in order to occupy a more central position in the reconstruction of global value chains.