Product Name: 1,6-hexanediol
Manufacturer: Yuanli Chemical Group Co., Ltd.

Left: Mr. Li
Manager of the Functional Chemicals 2nd Division. Joined HighChem in 2011, starting as a sales administrator before moving into a sales position. Achieved a remarkable track record by doubling the division's sales.
[Read Ms. Li's exclusive interview here.]

Right: Mr. Yu
Graduated from Tianjin University and completed a master's program at the University of Tokyo. Joined HighChem in 2018, currently responsible for sales of resin materials, additives, and fine chemicals in the Functional Chemicals Division.

——What kind of product is 1,6-Hexanediol?

Li  1,6-Hexanediol is a highly versatile raw material used in various industries. Its primary downstream applications are industrial, with the largest segment in HighChem being for polyurethane applications. It is also utilized in UV-curable resins, coating materials, and polyester resins. In Europe and the United States, it is also used in cosmetics applications, such as moisturizers.

——HighChem signed an agency agreement in August 2023 with the largest manufacturer in China for the domestic distribution of 1,6-Hexanediol in Japan.

Li  Originally, 1,6-Hexanediol was manufactured in North America, Europe, Japan, and China. However, last year, it was announced that production would cease in Japan, leading to changes in the domestic supply structure. Therefore, HighChem signed a sales agency agreement with Yuanli Chemical, China's largest 1,6-Hexanediol manufacturer, to fully enter the Japanese market.

——Why did you decide to partner with Yuanli Chemical?

Li  Firstly, we already had a track record of transactions with Yuanli Chemical at HighChem, and we knew they were a reliable manufacturer.

The primary reason Japanese customers choose Chinese manufacturers is the stability of supply. Yuanli Chemical has a geographical advantage and operates with two production bases in Shandong and Chongqing, which is highly valued by Japanese customers prioritizing BCP (Business Continuity Planning).

Li: "Yuanli Chemical is not only advantageous in terms of geography but is also highly regarded by customers who prioritize Business Continuity Planning (BCP) because of its dual-location system."

Yu  Additionally, Yuanli Chemical uses the current mainstream method of hydrogenation from adipic acid. China is also the largest production base for adipic acid, the raw material for 1,6-Hexanediol, ensuring stable procurement of raw materials and cost advantages.

——What is the supply system like in Japan?

Li  We use a heated storage tank in Kansai to stock liquid products in Japan and operate jointly with Amakasu Chemicals, which has a strong domestic sales network for fine chemicals.

Previously, Yuanli Chemical sold 1,6-Hexanediol in liquid form in Japan mainly through ISO tank containers. This time, we have made it possible to sell via tank trucks as well, allowing for smaller lot purchases compared to ISO tanks and meeting the needs of a broader range of customers.

——What are the points of differentiation from competitors?

Li  The most significant point of differentiation in the sale of 1,6-Hexanediol in Japan is the stability of supply. European and American manufacturers are farther away from Japan, and from a BCP perspective, having production bases in nearby China is a major differentiator.

Additionally, European and American manufacturers produce 1,6-Hexanediol as a by-product, which can lead to supply stability issues depending on the supply and demand situation of the main products.

——What is the future outlook for 1,6-Hexanediol?

Yu  The future outlook for 1,6-Hexanediol is positive globally. This product has a relatively short history, and when supply was limited, prices were high, making it difficult to use widely despite its potential applications. Recently, production has increased, especially among Chinese manufacturers, making it easier to use in fields where cost was previously a barrier. This indicates significant future potential for the product.

Yu: "The increase in manufacturers' production volumes has made it easier to use 1,6-Hexanediol in fields where cost had previously been a barrier."

Li  Yes, beyond industrial uses, it can be considered for a wide range of fields such as cosmetics, pharmaceuticals, and pesticides. 1,6-Hexanediol's characteristics include non-corrosiveness, low volatility, and high solvent capability. Additionally, it is valued as an environmentally friendly product, which can lead to new application developments such as water-based paints.