Chemical Profile - METHYL METHACRYLATE

27 February 2004 00:00  [Source: ICB Americas]

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METHYL METHACRYLATE     March 1, 2004

PRODUCER	CAPACITY*
CYRO Industries, Avondale, La.	290
Lucite International, Beaumont, Tex.	340
Lucite International, Memphis, Tenn.	340
Rohm and Haas, Deer Park, Tex.	790
Total	1,760

*Millions of pounds per year. Commercial production is by the reaction of acetone and hydrogen cyanide to form acetone cyanohydrin (ACH), which is further treated with sulfuric acid to produce methacrylamide sulfate. The sulfate is esterified with methanol to produce methyl methacrylate (MMA) , with ammonium bisulfate as a by-product. Routes to MMA that avoid the use of hydrogen cyanide or sulfuric acid have been commercialized globally, but the ACH process is used by all three basic US producers. In late 2003, Rohm and Haas Company began an expansion of its MMA unit at its Deer Park, Tex., plant. This new expansion will increase the site's MMA production capacity by 250 million pounds per year, increasing the total MMA output to approximately 1,040 million pounds per year. The Deer Park plant is the largest MMA producing plant in the world.
 In May 2002, Ineos Acrylics changed its name to Lucite International. The business was acquired in October 1999, from Imperial Chemical Industries PLC (ICI). In 2001, Ineos increased MMA capacity at Beaumont, Tex., by 50 million pounds per year, raising the siteÕs total MMA capacity to 340 million pounds. Profile last published 6/28/99; this revision, 3/1/04.

DEMAND
2002: 1,285 million pounds; 2003: 1,320 million pounds; 2007: 1,485 million pounds, projected. Demand equals production plus imports (2002: 14 million pounds; 2003: 26 million pounds) less exports (2002: 183 million pounds; 2003: 190 million pounds).

USES
Polymethyl methacrylate (acrylic) resins, 47 percent (cast and extruded sheet, 31 percent; molding powders and resins, 16 percent); surface coatings, 22 percent (latexes, 17 percent; other, 5 percent); impact modifiers, 13 percent; emulsion polymers, 8 percent; mineral-filled sheet, 8 percent; miscellaneous, 2 percent.

GROWTH
Historical (1998-2003): 1.3 percent per year; Future: 3 percent per year through 2007.

PRICE
Historical (1998-2003): High, $0.75 per pound, contract, tanks, dlvd.; low, $0.41 per pound, same basis. Current: $0.72 per pound, same basis.

STRENGTH
US consumption of MMA in acrylic sheet, molding and extrusion compounds, and surface coatings is affected strongly by construction and remodeling activity, as well as auto production, which are, in turn, greatly influenced by general economic conditions. These applications account for approximately 80 percent of MMA consumption. US demand for MMA rebounded in 2003 due to increased demand for polymethyl methacrylate from the construction industry, which continues into 2004. Housing starts in January were up 4.1 percent from one year ago, driven, in part, by the very low interest rates available for financing. Auto production, however, has only been holding steady, at best.

WEAKNESS
MMA saw a 9 percent drop in demand between 2000 and 2001 as the economy shrank, indicative of the materialÕs economic sensitivity. Though new home construction and home improvement sectors are again robust, rising use of vinyl siding in home construction has slowed the growth of acrylic latex paints.

OUTLOOK
US demand for MMA is forecasted at 3 percent per year through 2007. This is only slightly less than global demand growth, which should be 3.5 percent annually. Resin and sheet demand will be driven by construction and household improvement uses, while surface coatings formulated with MMA will see market pull from architectural and automotive applications. New offshore capacity being built in Asia could adversely affect US exports, which have been growing steadily over the past four years.

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