Adipic acid

09 July 2007 00:00  [Source: ICB Americas]

 
DEMAND

2005: 1.88bn lbs. 2006: 1.92bn lbs. 2010: 1.96bn lbs., projected. Demand equals production plus imports (2005: 107m lbs. 2006: 119m lbs.) less exports (2005: 216m lbs. 2006: 251m lbs.). Source: ICIS Chemical Business Americas, USITC

GROWTH

Historical (2001-2006): 3.7%/year future: 0.5%/yr through 2010. Source: ICIS Chemical Business Americas

PRICE

Historical (2001-2006): High, 77 cents/lb., f.a.s. export value low, 41 cents/lb., same basis. Current: 76-81 cents/lb., same basis. Source: USITC

USES

Nylon 6,6, 84% (fibers, 61% resins, 23%) polyester polyols (for polyurethane resins), 9% plasticizers, 4% miscellaneous, including unsaturated polyester resins and food applications, 3%. Source: ICIS Chemical Business Americas

MARKET PERSPECTIVE

Adipic acid demand is highly dependent on demand for Nylon 6,6. And more than 20% of its demand dependent on this polymer for use in resin manufacturer. Nylon resins belong to a group of high-performance plastics often referred to as engineering thermoplastics. These materials are noted for their outstanding properties, including high tensile strength excellent abrasion, chemical and heat resistance and low coefficient of friction. Thus, they have particular utility in performing mechanical duties that traditionally relied on metal parts.

Overall demand for nylon 6,6 has been in slow decline over the past decade, but somewhat steady for the past five years. This is due to a drop in nylon 6,6 fiber production. Though the strong housing market has kept demand for residential carpeting at a high level, the demand for industrial carpeting has fallen because of the weak commercial construction and hotel industry markets. And recently, even the housing market is retreating. Last month the Census Bureau reported that housing starts in May 2007 were down 2.1% from April and down 24.2% from May 2006. Building permits were up 3.0% from the previous month but down 21.7% from one year earlier.

Automobile and truck parts comprise the largest market for nylon 6,6 engineering resins. Automotive applications for many plastics have been driven in recent years in the trend toward replacing metal parts with plastics, thereby reducing the overall weight of motor vehicles. Automotive applications of nylon 6,6 resins include exterior body components (e.g., louvers, mirror housings and wheel covers), under-the-hood components (e.g., fan blades, emission control canisters, and reservoirs for brake and power steering fluids) and numerous mechanical components. The consumption of nylon 6,6 resins for automotive applications is expected to continue at above GDP rates as designers become accustomed to using nylon instead of metal for an increasing variety of small automotive components.

Other important and growing nylon 6,6 resin applications include: film and extrusion coatings, electrical and electronic parts, wire and cable coatings, and accessories for hardware, furniture and appliances.

OUTLOOK

The outlook for adipic acid is about average for a mature commodity chemical. U.S. nylon 6,6 resin demand is growing at 3% annually, but this is nearly offset by the 1% decline in the fiber sector, which is about three times as large. As a result, domestic adipic acid demand is expected to grow at 0.5% annually over the forecast period. Global demand, however, is increasing at 2-2.5% per year, which is attributed to Asian activity, mostly in China.

US ADIPIC ACID CAPACITY, MILLION LBS./YEAR
Company Location Capacity
Innolex Chemical Hopewell, Va. 55
INVISTA Orange, Tex. 485
INVISTA Victoria, Tex. 835
Solutia Pensacola, Fla. 900
TOTAL 1,105
SOURCE: ICIS CHEMICAL BUSINESS AMERICAS

*Millions of pounds per year. Commercial production is through nitric acid oxidation of a cyclohexanone-cyclohexanol mixture called KA oil (ketone-alcohol). INVISTA and Solutia derive KA oil from cyclohexane feedstock, while Inolex uses phenol as a starting material.

INVISTA and Solutia consume most of their adipic acid production captively, in the production of nylon 6,6 fibers and resins. Inolex consumes the majority of its adipic acid internally for polyester polyol production. All three companies send the balance of their adipic acid to the merchant market.

INVISTA is a wholly owned subsidiary of Koch Industries. In 2004 Koch acquired INVISTA (formerly DuPont Textiles and Interiors) from DuPont. INVISTA was then merged with Koch affiliate KoSa, a producer of commodity and specialty polyester fibers, polymers and intermediates.


Profile last published August 30, 2004

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