To maintain growth on a global basis, Kao has set the Chinese market as its most important priority.
As part of the operation, the cosmetics company has also established a new production company, Kao (Shanghai) Chemical Industries with the aim of reinforcing Kao's production system for industrial-use chemical products in China.
Planned investment
The production company's new plant is scheduled to start operations in 2014, and the investment is estimated at approximately five billion yen (€51m).
Specifically, the new plant will produce surfactants used as raw materials for cosmetics and toiletries, industrial-use cleaners, and materials used for molding.
In line with Kao Group's mission to save energy and mitigate its environmental impact, endeavors to reduce CO2 emissions will be promoted at the new plant.
Through provision of products that can contribute to CO2 emission reductions in the industrial sector and by recycling resources, Kao claims it is striving to contribute to reducing its burden on the environment.
Asia expansion
The latest development comes only months after Kao announced that its Indonesia Chemicals division will construct a new plant and expand its production facilities for surfactants used in cosmetics and toiletries.
This facility, estimated to cost over 4bn yen (€39m) initially, will be built at Karawan International Industry City (KIIC), located in the suburbs of Jakarta, Indonesia, and aims to meet increased demand in Asia.
The new plant site covers about 120,000 square metres, which is double the area of the production site currently being used, with plans to be complete by the end of 2014.
Demand for industrial products produced by Kao Indonesia Chemicals has been increasing both for domestic use in Indonesia and for export, according to the company, in line with the growth of the Asian economy.