Mitsui cuts PTA operating rates due to poor margins

30 November 2007 15:28  [Source: ICIS news]

SINGAPORE (ICIS news)--Japan’s Mitsui Chemicals will reduce operating rates at its No 2 and No 3 purified terephthalic acid (PTA) lines in Iwakuni by about 20% in December, owing to poor margins, a company source said on Friday.

  

“Our margins are squeezed by high feedstock costs and the poor pricing of PTA is making it necessary for us to reduce operating rates,” said the source.

 

Meanwhile, the company’s No1 205,000 tonne/year unit at the same site remains offline, since shutting in the second quarter.

 

The No 2 and No 3 units have a respective nameplate capacity of 165,000 tonnes/year and 380,000 tonnes/year.

 

Feedstock paraxylene (PX) costs have risen to $1,150/tonne CFR (cost and freight) NE Asia (northeast Asia) this week, up from $1,080/tonne about a month ago. Contract PX prices may also settle higher for December, compared to November’s $1,080/tonne.

 

But PTA spot prices had languished at $840-850/tonne CFR China in the same period, registering a peak of $855/tonne CFR China and falling towards $830/tonne on some days.

 

Mitsui is one of the largest PTA producers in the world, with facilities in Japan, Thailand and Indonesia. The company is also mulling a PTA project in China.

 

By: Salmon Aidan Lee
+65 6780 4359

< previous article(ICIS Chemical Business podcast November 2, 2009)

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