24 June 1996 00:00 [Source: ACN]
JAPANESE and western producers of 1,4-butanediol using traditional acetylene-based processes could be forced to shut plants once Sisas scales up to full capacity at its Feluy, Belgium, plant in 1998.
The plant will use Sisas' own technology which the company claims significantly undercuts the costs of established processes.
'This technology represents a new era for these products,' managing director Aldo Bertola said. 'The low costs of the process, together with the use of worldscale plants capable of considerable further expansion, will result in the complete obsolescence of processes currently in use.'
Through subsidiary Eurodiol, the Italian company will start 50 000 tonne/year of BDO integrated into gamma-butyrolactone, tetrahydrofuran and N-methylpyrrolidone production in Q2 1997. It plans to double the facility to 100 000 tonne/year in H1 1998.
The complex will be supported by expanded maleic anhydride production, with capacity increasing to 120 000 tonne/year in Q2 1997, 170 000 tonne/year at the start of 1998, and to 220 000 tonne/year during 1999.
The capacity planned by Sisas means it will have to export considerable quantities of material from Europe to Asia, a consultant at London-based Tecnon told ACN. Asian demand at 130 000 tonne/year accounts for 25% of world consumption, he estimated.
Asian demand is currently met in part by Mitsubishi Chemical, Tonen Sekiyu, Idemitsu BASF and Shinwha, and several Chinese makers. The remainder is met by imports, primarily from BASF in Germany which controls 40% of world supply.
Stiff competition worldwide is inevitable as Sisas scales up. 'The company will require a large market share to be competitive and is likely to be an aggressive player in the market,' one source said.
Asian prices collapsed to US$1200-1300/tonne cif Taiwan and US$1300-1400/tonne delivered in Japan when production was started in 1992 by Shinwha and Arco. Tonen's startup in 1993 made things worse, and prices recovered only in Q2 1994. BDO prices now range from US$1600/tonne cif Taiwan to US$1900/tonne delivered in Japan.
In Asia, only Idemitsu BASF operates the traditional Reppe process at its 25 000 tonne/year plant in Japan. Market leader Mitsubishi uses its own technology from butadiene and is expanding its 40 000 tonne/year of BDO and THF capacity at Yokkaichi by 25%. Tonen and Shinwha operate 22 000 tonne/year plants using Davy technology in Japan, and South Korea, respectively.
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