16 March 2011 11:07 [Source: ICIS news]
By Helen Lee
SINGAPORE (ICIS)--Asian demand for ethyl acetate solvent may rise by 10% this year due to raw material substitution, distributors said on Wednesday.
This followed a shortage of methyl ethyl ketone (MEK) after the shutdown of Maruzen Petrochemical’s 170,000 tonne/year MEK plant in Japan following the 9.0-magnitude earthquake that struck the northeast of the country on Friday 11 March.
“Up to 30% of MEK can be replaced with ethyl acetate, which means an increase of about 10% in demand for ethyl acetate,” a key southeast Asia-based distributor said.
That was equivalent to an increase in demand of around 4,000 tonnes per month of ethyl acetate, he added.
Other traders in the region said that MEK can also be replaced by acetone.
Maruzen Petrochemical company officials could not be reached for comment about the shutdown.
However, MEK prices in east China rebounded on news of Maruzen’s plant outage.
“On Friday, the local MEK price was yuan (CNY) 10,500-11,000/tonne ex-tank and demand was very weak, but this week due to Maruzen’s shutdown we can hardly find any cargo in the market, because no-one is offering big quantity,” a Shanghai-based trader said.
“I got 50 tonnes of MEK yesterday at CNY12,500/tonne ($1,900/tonne)," he added. "The price has increased by CNY1,500-2,000/tonne in two days.”
Asia MEK spot prices were at $1,740-1,750/tonne CFR (cost and freight) SE (southeast) Asia at the close of business on 11 March, according to ICIS, but sellers have suspended offers this week.
Meanwhile, Asia’s ethyl acetate spot prices remained fuelled by tight supply and had gained around 4% to 9.45% since January amid supply shortages, first in Europe and then in Asia due to a shortage of feedstock acetic acid following a force majeure declaration on acetic acid supplies from global producer Celanese's production facility in Nanjing, China.
Ethyl acetate customers in the region have been put on allocation, southeast Asia-based distributors and traders said, adding that the global producer’s Singapore ethyl acetate plant may be operating at reduced rates due to the curtailment of acetic acid supply. However, this could not be confirmed at source.
Ethyl acetate ex-tank transactions in the region rose by $40/tonne over last Friday’s closing price to $1,180/tonne, traders and distributors said on Wednesday.
Meanwhile, exporters of China-origin ethyl acetate raised offers to $1,070/tonne FOB (free on board) this week, up $10-20/tonne on the week. Discussions were ongoing to sell a cargo of 1,500-2,000 tonnes for April loading to a Europe-based distributor at this level.
MEK acts as a low-boiling solvent for nitrocellulose, acrylic and vinyl surface coatings with over half of global MEK demand deriving from the paints and coatings industry. It is also used in polyurethane applications.
Ethyl acetate is used in a variety of coating formulations such as epoxies, urethanes, cellulosics, acrylics and vinyls. Ethyl acetate is also used as a solvent in a number of applications.
Major ethyl acetate producers in Asia include Celanese Corp, Jiangsu Sopo Chemical Shareholding Co, BP Yaraco, Jiangmen Handsome Chemical Development and Korea Alcohol Industrial.
($1 = CNY6.58)
Yeow Pei Lin contributed to this story
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