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Photo courtesy of Yonhap News |
[Alpha Biz= Kim Joonhyun & Park Namsook] SEOUL, South Korea – October 22, 2025 –
Hanwha Group has come under fire for allegedly delaying the signing of a long-term ethylene supply agreement with Yeochun NCC (YNCC)—a key condition for the petrochemical firm’s recovery—fueling speculation that Hanwha may be steering the company toward workout or liquidation rather than rehabilitation.
According to sources familiar with the matter, DL Group Chairman Lee Hae-wook requested a long-term ethylene supply deal from Hanwha around September 2025 to improve YNCC’s cost stability and operational efficiency. However, Hanwha has reportedly continued to insist on short-term “spot” contracts, avoiding a long-term commitment.
YNCC, co-owned by Hanwha Solutions and DL Chemical, has been struggling amid the prolonged downturn in the global petrochemical industry. Since the previous ethylene contract expired in December 2024, the two shareholders have failed to reach a new long-term agreement—widely seen as the main cause of internal conflict.
DL Chemical has sought a price floor clause to prevent below-cost sales, while Hanwha has pushed for flexibility to purchase feedstock at lower prices when market conditions weaken. With polyethylene prices continuing to fall, analysts say YNCC’s finances are at risk of collapse without a stable supply contract.
YNCC currently produces about 14% of South Korea’s ethylene output, supplying raw materials to Hanwha Solutions and DL Chemical for products such as HDPE, LDPE, and PVC. Experts warn that unless both parties agree on fair pricing terms, YNCC’s survival will remain in jeopardy.
“YNCC is facing its worst financial outlook in years,” said Yoon Ju-ho, CEO of Umbrella Research. “Hanwha’s refusal to commit to a long-term deal suggests it may be quietly preparing for YNCC’s bankruptcy or workout process.”
Alphabiz 이준현 기자(wtcloud83@alphabiz.co.kr)
