Asia oleochem expansion faces feedstock problems

24 October 2007 14:30  [Source: ICIS news]

BRUSSELS (ICIS news)--Current global palm oil supply will not be enough for the new oleochemical capacities that are being built in Asia, a company official said on Wednesday.


Cheah Seng Chye, assistant general manager for marketing at Acidchem International, estimated fatty acid and fatty alcohol capacity in southeast Asia, both producing and under construction at 3.14m tonnes and 1.15m tonnes respectively. 


New and current capacity in China and India are estimated at 3.12m tonnes/year for fatty acid and 937,000 tonnes/year for fatty alcohols.


Cheah spoke about the current growth and challenges of the Asian oleochemical industry at the ICIS World Oleochemical Conference in Brussels, Belgium.


The two-day event ends on 24 October.


“The Asian oleochemical industry today is already 40% oversupplied even without the new capacities especially for fatty acids coming onstream,” he said.


“The sudden increase in China’s production is certainly quite alarming. If all the plants are expected to run, the supply of oil from southeast Asia will be under tremendous stress,” he added.


The development of Asian biodiesel industry is exacerbating the feedstock problem, said Cheah.


A total of 1m tonnes of biodiesel capacity from southeast Asia, India and China are currently being built but an additional 9m tonnes/year capacity is already in the planning stage.


“The crude glycerin market is already oversupplied. The influx coming from the biodiesel sector will make it even more difficult,” he added.


Acidchem projected total glycerine supply in southeast Asia, China and India at 635,000 tonnes/year.

By: Doris de Guzman
+1 713 525 2653

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