Chemical profile: Acetone

26 November 2007 00:00  [Source: ICB]

Uses

Acetone's main use is in acetone cyanohydrin, a precursor to methyl methacrylate (MMA) and methacrylic acid. An important derivative of MMA is polymethyl methacrylate (PMMA), used to make acrylic products. The other major outlet is bisphenol-A (BPA), used in epoxy and polycarbonate (PC) resins.

Acetone is also used directly as a solvent and to make other solvents such as methyl isobutyl ketone (MIBK) and methyl isobutyl carbinol. Other applications include higher molecular weight glycols and alcohols, pharmaceuticals and antioxidants.

Supply/demand

The European market remained steady in 2007. Healthy demand, which is much improved on 2006, as well as postponed expansions and delayed restarts have stopped the market becoming flooded with product and maintained a balance. INEOS Phenol's force majeure is likely to stay in effect until the end of November. Its plant in Antwerp, Belgium, is down for maintenance and an expansion of acetone output to 415,000 tonnes/year. Extra capacity also went online this year at Ertisa and Borealis.

In the US, supply is now loosening after force majeures limited supply earlier in the year. In Asia, tight supply forced up prices to a 27-month high in June. Trading is now thin and demand weak as the market awaits the outcome of China's antidumping probe on imports from Japan, Taiwan, Singapore and South Korea.

Prices

European quarterly MMA contracts have risen steadily this year, driven by climbing propylene feedstock costs. Fourth-quarter (Q4) contracts settled up €10/tonne at €930/tonne FD NWE, mirroring propylene's rise.

European spot numbers have remained largely stable this year. Spot prices in November are €700730/tonne FD NWE, while European export prices to Asia were $780840/tonne FOB Rotterdam T2. Acetone continues to make a loss.

Technology

Nearly 90% of production is via the reaction of propylene and benzene to cumene where acetone is coproduced with phenol. About 0.62 tonnes of acetone is produced with each tonne of phenol.

The isopropyl alcohol (IPA) route, where the alcohol is dehydrogenated to acetone over a catalyst, has been declining. A newer process that has been gaining importance in Japan is the direct oxidation of propylene, but it suffers from high capital costs andcorrosion problems. Small quantities of acetone are also produced as a by-product in the manufacture of propylene oxide (PO - Lyondell), acetic acid (Eastman Chemical) and hydroquinone (Goodyear).

Shell Chemical has developed a phenol process that coproduces both acetone and methyl ethyl ketone (MEK) and plans to build a plant in Singapore by 2011. Although the cost of making phenol is higher than the conventional cumene route, the large by-product credit received for the MEK is said to more than compensate.

Outlook

Overall demand growth in Europe is put at GDP rates. The main drivers are MMA/PMMA and BPA/PC, with solvents showing minimal growth. Supply in Europe will lengthen in 2008, as the impact is felt from new capacity, although some say this will be less than expected as large volumes will be exported to Asia to fulfill BPA commitments.

Projects are planned in Saudi Arabia, Iran, the United Arab Emirates, Singapore, China, South Korea, Thailand and Brazil. Novapex plans a plant to produce 40,000 tonnes/year of IPA from acetone in France for late 2009.

Longer term, Lucite's new MMA technology, which does not use acetone as a feedstock, is likely to take up any new growth in demand for MMA.


EUROPEAN ACETONE CAPACITY, '000 TONNES/YEAR

Company Location Capacity
Borealis Porvoo, Finland 120
Domo Caproleuna Leuna, Germany 90
Ertisa Huelva, Spain 375
INEOS Phenol Antwerp, Belgium 415*
Gladbeck, Germany 395
Kazanaorgsintez Kazan, Russia 35
Neftechimia Novokuibyshevsk, Russia 39
Novapex Roussillon, France 110
Omsk Kauchuk Omsk, Russia 33
Petrobrazi Brazi, Romania 15
PKN Orlen Plock, Poland 35
Polimeri Europa Mantova, Italy 185
Porto Torres, Italy 135
Saratovorgsintez Saratov, Russia 26
Shell Berre, France** 75
Pernis, Netherlands** 80
Sintez Dzerzhinsk, Russia 12
Ufaorgsintez Ufa, Russia 45

* includes expansion due end 2007 ** from isopropyl alcohol

SOURCE: ICIS

Profile last published August 22, 2005





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