29 January 2007 00:00 [Source: ICB]
Isopropanol (IPA) is a solvent (and extractant) with outlets in cosmetics and personal care products, de-icers, paints and resins, pharmaceuticals, food, inks and adhesives. It is also used in oil and gums, and to make fishmeal concentrates. Low-grade IPA is used in motor oils. Some chemical compounds are made from IPA such as methyl isobutyl ketone (MIBK), isopropylamines and isopropyl esters.
Different grades are available. The normal quality of anhydrous IPA is 99%+, while special grades (essence and pharmaceutical) are 99.8%+.
The global market remains oversupplied, with flat demand growth in Europe and the US. Sources say the market has seen some migration away from IPA to its rival solvent ethanol as surging propylene feedstock costs forced up IPA prices. But, producers hope that current rising ethanol prices may reverse the trend.
In Europe last year, Sasol lifted output at Moers, Germany, by 15,000 tonnes/year, and Shell added 50,000 tonnes/year at Pernis in the Netherlands. BP shut its 90,000 tonnes/year unit in Baglan Bay, UK, in March 2004, and sold its sales and marketing assets to ExxonMobil. European players say that they have seen more volumes from the US this year, compared with 2005 as a result.
Poor economics forced Reliance to shut its 35,000 tonnes/year plant in Mumbai, India, in 2006, but Deepak Fertilisers & Chemicals started production at its 70,000 tonnes/year plant, also in Mumbai, last August.
European spot prices have slipped in January by €10-20/tonne to €880-920/tonne FD NWE, as propylene feedstock costs drop €45/tonne. In the US, spot prices were steady at 48-52 cents/lb, although contract prices were starting to slip by 2 cents/lb. In Asia, spot levels edged up $10-30/tonne to $980-1030/tonne CFR northeast Asia. A European supplier said that margins deteriorated in 2006 and remain unsatisfactory.
Two commercial routes to IPA are used. The older method is based on the indirect hydration of refinery-grade propylene using sulphuric acid. A newer route is the direct hydration of chemical grade (90-99%) propylene. A small amount of IPA is produced by the hydrogenation of acetone in the liquid phase. This process is only suitable where there is excess acetone.
IPA is a clear, colourless, volatile liquid, with a slight odour. It is highly flammable and an explosion hazard as vapours mix well with air. Vapours irritate the eyes, nose and respiratory tract and may cause drowsiness and dizziness. It can be absorbed through the skin.
Demand growth will remain flat in Europe and the US. Stronger growth will be seen in Asia, but is weaker than previously forecast and likely to be just at GDP levels. No further projects have been announced as present installed capacity remains in excess of demand. However, Japan's Tokuyama and Nippon Refine formed a joint venture last November in Jiansu, China, to produce and sell IPA for electronics manufacture. No further details on the proposed plant have been revealed.
There may be further asset consolidation, with older plants and those based on sulphuric acid the likely candidates for closure.
|CNPC Jinzhou Petrochemical||Jinzhou, China||100|
|Deepak Fertilisers and Petrochemicals||Taloja, India||70|
|Dongying Hi-Tech Spring Chemical Industrial||Dongying, China||30|
|Dow Chemical||Texas City, Texas, US||250|
|Equistar Chemical||Channelview, Texas, US||29.5|
|ExxonMobil||Baton Rouge, Louisiana, US||340|
|Lee Chang Yung||Lin Yuan, Taiwan||110|
|LG Chem||Yeosu, South Korea||30|
|Mitsui Chemicals||Takaishi, Japan||33|
|Nippon Petrochemicals||Kawasaki, Japan||75|
|Rhodia Brasil||Paulinia, Brazil||10|
|Deer Park, Texas, US||270|
|Sarnia, Ontario, Canada||95|
Profile last published 1 March 2004
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