Celanese declares FM on supply from Nanjing acetyls complex

10 March 2011 09:23  [Source: ICIS news]

SINGAPORE (ICIS)--Global acetyls producer Celanese declared a force majeure (FM) last week on supply from its Nanjing acetyls complex, citing “unexpected production disruptions”, according to a document obtained by ICIS on Thursday.

The company placed customers in mainland China and Taiwan on 40% allocation until further notice, based on the document dated 3 March.

Market sources said that Celanese’s 1.2m tonne/year acetic acid plant and 300,000 tonne/year VAM plant in Nanjing halted operations on 2 March, with the tentative restart date set on 22 March.

When asked about the outage and restart date of the Nanjing complex, a Celanese spokesperson said: “Celanese does not comment on the operational status of our manufacturing facilities.”

Some market sources attributed the cause of the outage to a leakage at a reactor unit at the site, while others pointed to problems at the control tower of the complex.

If the outage was due to problems at the reactor, Celanese’s plants may be down for a longer period of two to three months, market sources said.

It was not clear if the recent plant outage was related to the outage in late January.

“It seems that their production was not stable in the past period,” an eastern China-based distributor said.

Domestic producers in China had raised their acetic acid offers by around yuan (CNY) 300/tonne ($45.7/tonne) this week to more than CNY3,300/tonne ex-tank because of the outage Celanese’s Nanjing complex, market sources said.

Offers for spot exports were also raised by $60/tonne (€43.2/tonne) this week to $530/tonne FOB (free on board) China, they said.

A wide buy-sell gap however, hindered trades, as buying ideas in India were low at around $550-560/tonne CFR (cost and freight) basis, market sources said.

Major acetic acid producers in China include BP, Jiangsu Sopo, Shanghai Wujing, Yankuang Cathay Coal Chemicals, Henan ShunDa Chemical and Hebei Chung Shun Chemical.

($1 = CNY6.56 / $1 = €0.72)

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By: Helen Lee
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