03 June 2010 13:22 [Source: ICIS news]
LONDON (ICIS news)--Lotte Chemical UK is likely to be out of the purified terephthalic acid (PTA) market for 10 days following its declaration of force majeure on sales of the material from its plant at Wilton, UK, a company source confirmed on Thursday.
A problem with the 500,000 tonne/year plant’s external steam supply on 30 May caused a blockage that brought the unit to a halt, according to Mark Kenrick, the company’s business director.
“We came off line to clean the plant out. To get the solid PTA out of the way will take approximately 10 days,” Kenrick said.
The company informed major customers of the force majeure by letter on 2 June, he said.
According to a PTA buyer, the market was not long and downstream polyethylene terephthalate (PET) plants were running at full capacity.
As a result of Lotte Chemical UK’s force majeure on PTA, the company reduced the capacity of the ?xml:namespace>
“I expect we can carry on supplying contract customers with the agreed volumes, but we have nothing to go into the spot market with,” he added.
The impact of the force majeure would depend on each customer’s supply profile, Kenrick said.
A major PET producer said it was considering reducing operating rates at one of its facilities because of the lack of PTA from Lotte Chemical UK.
Another producer said the force majeure was unlikely to impact its PET output.
Some PET producers were already targeting price increases for June of €20-30/tonne ($24-37/tonne) compared with May’s €1,160-1,200/tonne FD (free delivered) NWE (northwest Europe).
Other producers, however, said they expected that a period of panic buying, bad weather and subsequent slow demand would lead to nothing more than a rollover in prices.
Lotte Chemical UK restarted its PTA and PET plants in April after they had been shut down for over a year.
A subsidiary of KP Chemical, Lotte Chemical UK bought Artenius’
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