Capco shuts biggest PTA line, idles two others

15 June 2007 03:32  [Source: ICIS news]

SINGAPORE (ICIS news)--China-American Petrochemical Co (Capco) has shut its largest purified terephthalic acid (PTA) unit in Taiwan, while keeping two smaller lines idle due to difficult market conditions, company sources said on Friday.

The 700,000 tonne/year facility at Taichung in central Taiwan was shut last week, in line with the maintenance shutdown of an adjacent power station, said one of the sources.

“Full operation is expected to resume later this week,” said the source.

Another source confirmed that because of difficult market conditions, Capco had idled an additional 250,000 tonne/year unit at Kaohsiung in the south of the island earlier this week.

The major had been keeping another one of its smaller PTA units at Kaohsiung idle since January this year. The company has a total of four PTA lines, each of  250,000 tonnes/year, at Kaohsiung.

Restart of the two idled units had not been set, “but we’re committed to tweaking our operations as we go along, in order to manage our PTA and paraxylene (PX) inventories in such a [difficult] market,” said the second source.

Like most PTA producers, Capco had seen its margins squeezed by rising feedstock PX costs, and poor PTA pricing over the past year.

PX costs rose as high as $1,320/tonne CFR (cost and freight) Taiwan and China in May, although it had fallen towards $1,200/tonne CFR by early June. But PTA prices had hovered no higher than $950-960/tonne for most of May, and are now only around $900/tonne.

Capco, with a nameplate capacity of 2.1m tonnes/year, is Asia’s largest PTA producer and possesses six lines in total – five at Kaohsiung and one at Taichung.

By: Salmon Aidan Lee
+65 6780 4359

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