Product Profile: Ethyl acetate

03 November 2003 00:00  [Source: ICB]

Europe has come under pressure from new capacity and competition among suppliers, causing prices to suffer

Uses

Ethyl acetate (EA) is an active solvent that is available in three grades: 85-88%, 99% and 99.5% (urethane grade). The most popular grade, 99%, is mainly used in industrial lacquers and surface coating resins. It is also used as an extraction solvent in the production of pharmaceuticals and food and as a carrier solvent for herbicides. About 60% of demand is in coatings. Process solvents, including pharmaceuticals and organic synthesis, account for 15% of demand as does printing inks. Miscellaneous uses, including adhesives and cosmetics, account for 10% of consumption.

Supply/demand

European markets are suffering from weak demand and excess availability. The economic slowdown has impacted consumption this year, particularly into printing inks and coatings.

Supply has also lengthened following the restart of BP's Hull, UK, plant in late 2002 after a six-month long outage and this, together with players fighting for market share, has added to pressure on prices. Import volumes have declined, particularly in the second half of this year. Less material is now available from Russia where output has been reduced and plants focus instead on the production and export of acetic acid feedstock.

Pricing

Prices in Europe have fallen consistently since spiking in mid-2002 as a result of BP's outage and force majeure. Numbers are now said to be at a historical low, although producers managed to lift prices by about €30-50/tonne from 1 October. Prices are currently reported in the range €550-580/tonne FD, although numbers in the low €500s/tonne are also heard. Margins are said to be poor.

Technology

The main production method involves the esterification of ethanol with acetic acid in the presence of a catalyst although some EA is produced by the catalytic condensation of acetaldehyde with alkoxides. Solutia obtains EA as a coproduct in the production of polyvinyl alcohol which it uses captively to make polyvinyl butyral.

Several new technologies have been commercialised. BP's Avada process, employed in a new plant at Hull, UK, uses ethylene and acetic acid with a solid acid catalyst. Davy Process Technology (formerly Kvaerner) has licensed its ethanol-based process to Sasol. In this route, ethanol is dehydrogenated to acetaldehyde which further reacts to form EA. Chinese National Petroleum has developed a one-step ethanol process where ethanol is partially oxidised to acetic acid and then esterified with excess ethanol.

Health and safety

EA is a colourless, mobile, volatile liquid. It is highly flammable and can form explosive mixtures with air. In a fire, flashback can occur as its vapours are heavier than air. EA is moderately toxic by inhalation and vapours can irritate the eyes and respiratory tract. Prolonged contact can cause defatting of the skin leading to dermatitis.

Outlook

Future demand growth in Europe is put at 2-3%/year. No new capacity is planned, or likely, in Europe. Most capital investment is targeted for Asia, and China in particular, where demand is growing rapidly. The Southeast Asian paints and coatings market is tipped to grow at 5-6%/year.

Several new plants are slated in China for post 2004. In Japan, Showa Denko has set up a 55:45 joint venture with Kyowa Hakko Kogyo, called Japan Ethyl Acetate, and the partners are converting an idled acetic acid facility at Oita to produce 100 000 tonne/year EA. Production should start in April next year. Kyowa Hakko will then close its existing unit in Yokkaichi. Showa Denko is also considering building a new plant in China or expanding at its Indonesian subsidiary.

Major global ethyl acetate capacity*, '000 tonne/year

Company	Location	Capacity
Aliachem	Pardubice, Czech Republic	12
Atanor	Buenos Aires, Argentina	10
BP Chemicals	Hull, UK	220
Celanese	La Cangrejera, Mexico	92
	Pampa, Texas, US	60
	Pulau Sakra, Singapore	60
Chiba Ethyl Acetate
	Ichihara, Japan	50
Eastman	Kingsport, Tennessee, US	27
	Longview, Texas, US	32
Ercros	Tarragona, Spain	60
International Ester
	Ulsan, South Korea	75
Jubilant Organosys
	Gajraula and Nira, India	50
Korea Alcohol Industrial
	Ulsan, South Korea	25
Kyowa Hakko Kogyo
	Yokkaichi, Japan**	40
Laxmi Organic Industries
	Mahad, India	35
Rhodia Brasil	Paulinia, Brazil	100
Sasol	Secunda, South Africa	50
Shandong Jinyimeng Chemical
	Shandong, China	80
Shanghai Wujing Chemical
	Wujing, China	30
Showa Denko	Nanyo, Japan	150
Showa Esterindo
Indonesia	Merak, Indonesia	60
Solutia	Antwerp, Belgium	12
	Springfield,
	Massachusetts, US	14
	Trenton, Michigan, US	11
Svensk Etanolkemi
	Domsjo, Sweden	35
Union Carbide	Stockholm, Sweden	30
Yangtze River Acetyls
	Chongqing, China	30
* Only includes plants over 10 000 tonne/year
** To be scrapped in H1 2004
Source: ECN/CNI

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