S Korea’s Kumho Mitsui Chem faces low MDI inventory on outages

18 January 2011 09:28  [Source: ICIS news]

SINGAPORE (ICIS)--South Korea’s Kumho Mitsui Chemicals (KMCI) has a significantly lower methyl di-p-phenylene isocyanate (MDI) inventory caused by persistent technical issues and a brief power outage, a company source said on Tuesday.

KMCI shut its MDI facilities, with a combined nameplate of 140,000-150,000 tonnes/year, on 8 January due to a technical problem. The facilities were restarted subsequently at a reduced operating rate of 70%.

On Monday afternoon, the MDI plants shut once again due to a power outage at the Yeosu Petrochemical site.

“We are still not sure when the plants are restarting,” the source said, adding that there might be some shortage of feedstock since the upstream units had not restarted.

“Also, we have yet to solve the technical problem. Although we are not sure how much MDI is lost, we are getting worried about our February availability,” he added.

Some Chinese players viewed this news as a bonus for the dull key China market.

“Supply [and] demand in China has been rather balanced, or maybe residing on the high side due to Yantai Wanhua’s start-up of [its] second unit. Thus, prices had been suppressed. With Kumho having less availability, there maybe some support on prices for February shipment,” an eastern China trader said.

“Although Kumho is not the key exporter to China, any news of reduced availability from producers will lift up sentiment. That’s good enough,” a regional trader added.

China polymeric methyl di-p-phenylene isocyanate (PMDI) prices rolled over at $1,960-1,980/tonne (€1,470-1,485/tonne) CFR (cost & freight) from last week amid a slowdown in business as end-users were amply covered for the upcoming Lunar New Year holidays.

KMCI is planning an annual turnaround in May, but the shutdown schedule might be revised.

KMCI is a joint venture between Japan’s Mitsui Chemical and South Korea’s Kumho Petrochemical.

Other MDI producers in Asia include Yantai Wanhua Polyurethanes, Nippon Polyurethane, BASF and Huntsman.

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Author: Sheau Ling Ong

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