Mitsubishi Chemical Group has announced that it will exit its biodegradable plastics business. While the company previously manufactured such products in Thailand, production operations ceased at the end of 2025. The company has concluded that intensifying competition from alternative materials will hinder future growth in this segment.

Biodegradable plastics are used in food packaging, such as coatings for paper cups and coffee capsules. Mitsubishi Chemical had previously produced them in Thailand through a 50-50 joint venture with a major local chemical firm. However, production was halted in late December 2025, and sales will be discontinued once existing inventory is sold off. Other players, including Kaneka Corporation, have also entered the biodegradable plastics market, further intensifying competition.

Mitsubishi Chemical estimates the exit will incur total costs of 10 billion yen, including equipment demolition expenses and impairment losses on equity investments. These costs will be recorded as special losses of 5 billion yen each in the fiscal years ending March 2026 and March 2027, respectively.