14 April 2011 13:40 [Source: ICIS news]
LONDON (ICIS)--The hydrochloric acid (HCl) market in eastern Germany is likely to tighten as a result of BASF’s shutdown in May of its 80,000 tonne/year toluene di-isocyanate (TDI) plant at Schwarzheide, market players said on Thursday.
A BASF source said production at the facilities will be suspended next month for three weeks of annual maintenance, and operations are expected to resume by the end of May.
As BASF is the only producer in eastern Germany of HCl, which has a concentration grade of 32%, the outage will restrict supply in that region of the country.
The source said that producers in western Germany might meet the temporary material needs of buyers in the east, which it estimated at 15,000 tonnes.
According to one producer, the impact of planned shutdowns on Germany's HCl market have historically been minor because producers tend to build inventories in advance and traders have large storage capacities.
“Only prices of volumes sold in the spot market might fluctuate slightly, but contract prices will not be affected because these are settled through annual agreements,” the producer said.
The BASF source said the company’s share of Germany's HCl market is approximately 15%.
Bayer is the largest HCl producer in Germany, with about 1m tonnes produced through its methylene di-p-phenylene isocyanate (MDI) plants at Uerdingen and Brunsbuttel, in western Germany.
HCl is extremely corrosive and has special transportation requirements, such as rubber-lined road tankers, railcars and specially lined rubber ships.
Because of the high cost and technical difficulties involved in the transportation of HCl, plant outages tend to tighten local markets and lead to a short-term rise in spot prices.
HCl can either be produced by burning chlorine or as a by-product of various chlor-alkali processes, such as the manufacture of TDI, MDI, ethylene diamine (EDA), vinyl chloride monomer (VCM) and polyvinyl chloride (PVC).
The product's end-uses include steel pickling/metallurgy, pulp and paper, and chemical and water treatment.
ICIS last week assessed HCl prices in Germany at €70–85/tonne ($101–123/tonne) FD (free delivered) Germany.
Sources described the market as stable, with healthy demand and good supply.
($1 = €0.69)
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