10 June 2008 05:44 [Source: ICIS news]
SINGAPORE (ICIS news)--Japan-based Mitsui Chemicals could cut operating rates at its methyl isobutyl ketone (MIBK) plant for the second time in three months if prices fail to keep up with surging upstream values, a source close to the company said on Tuesday.
The company had been running its 30,000 tonne/year swing plant at 60% capacity for around a month between April and May before ramping up production to 100% on 24 May. It could reduce operating rates again in July if target prices were not achieved.
"We expect prices [of MIBK] to rise to around $2,000/tonne CFR [cost and freight] China in July. But if prices do not increase enough, we might have to cut our operating rate because raw material costs are squeezing our margins," the source said.
Mitsui Chemicals’ swing plant at Iwakuni in Yamaguchi prefecture could also produce other solvents such as methyl isobutyl carbinol (MIBC)
"If prices of downstream products such as MIBK do not rise sufficiently, acetone and MIBK producers would have to cut operating rates," the source said.
Mitsui Chemicals is Asia’s largest producer of phenol, acetone and MIBK.
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