04 June 2007 00:00 [Source: ICB Americas]
2005: 1.105bn lbs. 2006: 1.11bn lbs. 2010: 1.201bn lbs., projected. Demand equals production plus imports (2005: 681m lbs. 2006: 641m lbs.) less exports (2005: 180m lbs. 2006: 363m lbs.). Sources: ICIS Chemical Business Americas USITC
Historical (1998-2003): 1.9%/year. Future: 2%/year through 2010. Source: ICIS Chemical Business Americas
Historical (2001-2006): High, 55 cents/lb., contract, bulk, f.o.b., Gulf low, 17 cents/lb., same basis. Current: 53 cents/lb., same basis. Current spot price, 52-54 cents/lb., f.o.b., Gulf, export. Source: ICIS pricing
Phthalic anhydride, 92% miscellaneous, including solvent applications, bactericides, soybean herbicides and lube oil additives, 8%. Source: ICIS Chemical Business Americas
OX's major market, phthalic anhydride, has three principal uses: phthalate plasticizers used in compounding polyvinyl chloride resins, unsaturated polyesters used in glass-reinforced, thermoset engineering applications, and alkyd resins used chiefly for surface coatings.
Phthalic anhydride plasticizers are used to modify compounded polymers, primarily polyvinyl chloride (PVC) resins. Thus, consumption of plasticizers is largely dependent on the growth of flexible PVC, which is sensitive to general economic conditions, construction and automobiles being the principal drivers. In 2000 and 2001, PVC production dropped significantly, before recovering in 2002 to a level comparable to that reached in 1999. Demand for OX mirrored this decline and recovery. Demand continued growing until 2005 when new-housing construction softened.
About 24% of phthalic anhydride, derived form OX, is used in preparing unsaturated polyester resins (UPR), which are thermosetting and usually blended with glass fibers to produce fiberglass-reinforced plastics. The principal markets (construction, marine and transportation) are closely linked with the general economy, but UPR growth is tempered by the major application areas having become saturated.
Phthalic anhydride-derived alkyd resins, about 15% of OX demand, are principally used in surface coatings for architectural, machinery, furniture and fixture applications. Demand for phthalic anhydride-based alkyds has been negatively influenced by clean-air regulations limiting the level of vol-atile organic compounds in surface coatings.
OX is also a precursor for polyethylene-2,6-naphthalate (PEN), which is a high-performance polyester that is being used to produce film and rigid packaging where performance needs are more rigorous than polyethylene terephthalate (PET) products. PEN is an emerging, potentially significant market and could dramatically increase the demand for OX in coming years.
OX producers have been running at 75-80% of capacity. Spot pricing is in line with contract pricing, indicating the market is generally balanced. Demand is anticipated to increase later this year with an upturn to the housing market. Over the forecast period, annual growth for OX is projected to be 2%.
US Orthoxylene CAPACITY,million LBS./year
|Flint Hils Resources||Corpus Christi, Tex.||405|
|Houston Refining||Houston, Tex.||270|
*Millions of pounds of orthoxylene (OX) per year. Typically recovered via two-stage distillation, OX is first distilled from other C8 aromatics. The overhead fraction consists of meta- and para-xylene and ethylbenzene. The bottoms, a mixture of OX and C9 and higher aromatics, are redistilled to recover OX and C9 and higher aromatics. The latter are used as solvents or as blending components for gasoline. The purity of the OX produced is 98-99%.
All producers have captive supplies of mixed xylenes. Large quantities of unisolated OX in mixed xylene streams are used in gasoline or isomerized to p-xylene. ExxonMobil is the only US producer to use OX captively for phthalic anhydride production.
Lyondell's refining business is conducted through Houston Refining, formerly known as LYONDELL-CITGO Refining. Houston Refining was a joint venture between Lyondell and CITGO Petroleum Corporation until Lyondell acquired CITGO's 41.25% interest in Houston Refining in August, 2006.
Flint Hills Resources is the refining and chemical subsidiary of Koch Industries, formed in January 2002 with Koch's reorganization.Profile last published August 2, 2004
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