Product Profile: Cumene

04 August 2003 00:00  [Source: ICB]

 
Long-term demand will continue to grow, but there is uncertainty on the current health of derivatives markets, which weakened in Q3
Uses

Cumene is used almost exclusively (about 98% of output) to make phenol and its co-product acetone. Other uses are as a thinner for paints, lacquers and enamels, as a constituent of some petroleum-based solvents, and as a component of high octane aviation fuel.

It is also used in the manufacture of polymerisation and oxidation catalysts and to make acetophenone, alpha-methylstyrene and peroxides.

Supply/demand

Europe is net short of cumene and sources most of its shortfall from the US, although Dow Chemical's startup last year of its 300 000 tonne/year expansion has reduced Europe's import requirement.

Players say there is sufficient availability and demand has softened in the latter part of quarter two. Consumption into phenol was reasonably healthy in the early part of the year, but there are concerns now on the poor state of global bisphenol-A (BPA) and polycarbonate (PC) markets, particularly in Asia. Caprolactam markets have remained depressed, here and in Asia.

Weak market conditions forced Huntsman to mothball its 120 000 tonne/ year plant in Wilton, UK, in early 2002. Difficult conditions in the US have also prompted Chevron Phillips Chemical to announce the closure of its 500 000 tonne/year unit at Port Arthur, Texas, by the end of the year. It says it will consider a restart when the market improves.

Pricing

The European merchant market is very limited with most major cumene players integrated downstream into phenol production. Most European and US prices are fixed according to formulae, which factor in benzene and propylene feedstock costs.

In the US, prices have been quite volatile this year as they tracked feedstock movements. Non-formula based contract prices were pushed up to 32.5 cent/lb in March. However, the recent sharp decline in raw materials pricing has put numbers into reverse, with June back down to 24 cent/lb.

Technology

Modern technology is based on the reaction of propylene and benzene either in the liquid or gas phases. These processes initially used solid phosphoric acid (vapour phase) or aluminium chloride (liquid phase) catalysts.

However, in recent years, production economics have been radically changed by processes which use zeolite catalysts. There has been a rapid shift to these zeolite-based systems, particularly in the US. These routes offer lower costs through high benzene-to-cumene selectivity, high product purities and the ability to regenerate the catalyst, eliminating a waste disposal problem.

A further development has been the combination of the catalytic reaction with distillation in a single column using the heat from the exothermic reaction in the distillation. This serves to reduce the amount of energy required.

The Shaw Group has bought Badger Technologies and, via its Stone & Webster subsidiary, has formed a 50:50 joint venture with ExxonMobil to market, license and develop cumene technology.

Health and safety

Cumene is a colourless, flammable liquid with a characteristic odour. It reacts violently with acids and strong oxidants and is a fire and explosion hazard. Above 31oC, explosive vapour/air mixtures may be formed and there is a risk of flashback. It can irritate the eyes and skin, and excessive exposure can cause headaches and narcosis.

Outlook

Demand growth is tied very closely to phenol and its derivatives, particularly BPA and PC. The derivatives are still forecast to grow at high rates, although lower than the double digit figures previously expected. CMAI predicts strong demand will continue for cumene, possibly reaching as high as 11m tonne by 2007, with annual capacity additions of more than 400 000 tonne.

The trend for new capacity is centring on integrated cumene/phenol plants, or through partnerships and alliances. Significant additional capacity has been announced for Asia from 2005, but some projects are likely to be delayed until closer to 2010 because of the more subdued growth.

Future threats to cumene demand are the feared lack of propylene supply in Asia, which will impact the cost structure of new cumene/phenol units, and, in the longer term, new feedstock routes to phenol.

US cumene contract prices, fob
Company Location Capacity

Borealis

Porvoo, Finland 180

BP

Marl, Germany 250

Carom

Onesti, Romania 35

Domo Caproleuna

Leuna, Germany 270

Dow Chemical

Terneuzen,
Netherlands 700

Ertisa

Huelva, Spain 510

Kazanorgsintez

Kazan, Russia 98

Omsk Kauchuk

Omsk, Russia 100

Petrobrazi

Brazi, Romania 105

Polimeri Europa

Torro Torres, Italy 320
Priolo, Italy 280

PKN

Plock, Poland 70

Rhodia

Roussillon, France 230

Ruhr Oel

Gelsenkirchen,
Germany 500

Samara Ethanol

Novokuibyshevsk,
Russia 115

Saratovorgsintez

Saratov, Russia 67

Slovnaft

Bratislava, Slovakia 55

Ufaorgsintez

Ufa, Russia 165
Source: CMAI




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