BASF Feluy, Belgium PA closure likely end of Q3
17 June 2005 12:16 [Source: ICIS news]
LONDON (CNI)--The closure of BASF's phthalic anhydride (PA) plant at Feluy, Belgium is likely to happen at the end of the third quarter this year, the company’s business manager for phthalic anhydride in Europe said Friday.
BASF announced Wednesday plans to cease the production of phthalic anhydride and several other products at Feluy due to a stagnation in the European market.
Overcapacity of PA and plasticisers in Western Europe means that PA production is unprofitable, the PA business manager said. Current European PA capacity, with the inclusion of Central European plants, is sufficient to meet European demand.
BASF has only been operating 30,000 tonne/year of its 105,000 tonne/year PA nameplate capacity at Feluy since November 2004, when it announced the end of merchant PA sales from the site. This 30,000 tonne/year production is used solely for captive plasticisers production.
BASF will continue to produce PA at its Ludwigshafen site in Germany, which has a nameplate capacity of 110,000 tonne/year. Around two thirds of this is used captively for plasticisers production, and the remainder goes into merchant sales.
Sources in the European PA market commented this week that, although the closure is not removing any PA volume from the merchant market, there will be longer term implications for both PA and downstream markets.
BASF’s closure of both PA and the associated downstream production will not impact current European PA availability, but plasticisers producers may look to increase their market share in the future, and this in turn could lead to increased demand for PA.
Discussions with union officials and employees at the site have taken place this week.
By: Geraldine Gilmartin
+44 20 8652 3214
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