Europe hit by DSM outage

09 August 1997 00:00  [Source: ICB]

News of an unscheduled outage at DSM's 110 000 tonne/year phenol plant in Rotterdam, the Netherlands, has come as a blow to Europe's tight phenol market. DSM will bring down the Bötlek unit for seven to fourteen days from 10 September for repairs and a 10% capacity expansion. DSM's phenol production is consumed captively at its 200 000 tonne/year caprolactam unit at Geleen, the Netherlands. However, sources say tight European supply will mean difficulties in sourcing additional spot phenol.

European phenol producers are claiming hikes for September of DM50-100/tonne reflecting tight supply and healthy downstream demand from derivatives bisphenol A and caprolactam. The hikes will raise prices to DM1350-1450/tonne. Producers say they will also seek a further DM200/tonne for October.

However, consumers are resisting the increases pointing to the 'dramatic improvement' in third quarter margins caused by the DM80/tonne and DM25/tonne drop in benzene and propylene contract prices respectively. Another buyer believes European supply is balanced and exports to the US, where prices are DM200/tonne higher, are keeping European markets artificially tight.

Inventories are low with one supplier citing stock levels for July at 27 000 tonne. Following the June force majeure, Phenolchemie's customers are now receiving full contractual volumes and its Antwerp and Gladbeck plants are running flat out.

Markets are set to remain tight in September and October compounded by shutdowns at Borealis and Enichem. Borealis is debottlenecking its Porvoo unit while Enichem will go down for maintenance at Mantua for three weeks from the end September/early October to tie in with a 15 000 tonne/year increase.

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