Dow experiences technical problems at Terneuzen benzene plant

09 October 2009 14:03  [Source: ICIS news]

LONDON (ICIS news)--Dow Chemical has been running its benzene unit at Terneuzen, the Netherlands, at reduced rates for about a week due to technical problems, a company source said on Friday.


“We expect to shut down our plant sometime in mid-October [for repairs] but the duration is yet unknown, perhaps for a week or two,” added the source.


Players in the market said they had already suspected that Dow was experiencing technical problems, as the American chemical company had been noted on the buy side in the spot market since 2 October.


Benzene buying interest in the Mediterranean was up, according to sources, forcing European values to rise by more than $100/tonne (€68/tonne) in a week due to tightness in a prompt market.


“Prices are moving up because buying interest is bigger than supply,” said a trader.


Some sources said European benzene values, currently being the highest globally, could trigger imports.


Nevertheless, it appeared that the US did not want to lose any material to Europe, as it kept the arbitrage to other regions firmly shut.


Deals in the US were reported on 8 October at $2.80/gallon for October and $2.75/gallon for November, both on a free on board (FOB) US Gulf basis, while Asian values were pegged at $770-790/tonne FOB Korea, according to global chemical market intelligence service ICIS pricing.


There was currently no opportunity to ship to Europe from Asia either, sources said.


European benzene values continued their upward trend on Friday, with deals reported at $850-880/tonne CIF (cost, insurance, freight) ARA (Amsterdam, Rotterdam, Antwerp), with reports that some trades took place as high as $900/tonne.


Dow’s benzene plant at Terneuzen has an annual capacity of 900,000 tonnes, which includes both extraction and the hydrodealkylation (HDA) unit, the source said.


($1 = €0.68)


For more on Dow Chemical visit ICIS company intelligence

For more on benzene visit ICIS
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By: Madelon Ten Cate
+44 20 8652 3214

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