Hualian Sunshine shuts one China PTA line

15 June 2007 03:41  [Source: ICIS news]

SINGAPORE (ICIS news)--China’s Hualian Sunshine has shut one of its three purified terephthalic acid (PTA) lines at Shaoxing in Zhejiang province, while running its Eastman proprietary terephthalic acid (EPTA) unit at reduced rates, a company official said on Friday.

The official confirmed market rumours that a power trip at one of the company’s generators at the Shaoxing site last week caused the EPTA line to shut, while slashing operating rates at its two PTA lines.

“The EPTA line was restarted after about three or four days, but it is running at reduced rates of say, 80%,” the official said.

The company shut down one of its two PTA units this week, “for a shutdown lasting about ten days, but startup might be delayed slightly if market conditions are not favourable,” said the official.

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

Paraxylene (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 June.

But PTA prices had hovered no higher than $950-960/tonne CFR China for most of May, and are now around $900/tonne.

The company’s remaining PTA line is running “normally”, the official said.

Hualian Sunshine, based at the Zhejiang city of Shaoxing, is one of the largest PTA producers in China. Each of its three lines has a nameplate capacity of 600,000 tonnes/year, putting overall capacity at 1.8m tonnes/year.

Other leading PTA producers in China include Sinopec Yangzi Petrochemical, Xiang Lu Petrochemical, Yisheng Petrochemical and Ningbo Mitsubishi Chemical.

So far, no other Chinese maker had cut back on production on squeezed margins.

By: Salmon Aidan Lee
+65 6780 4359

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