14 June 2011 15:24 [Source: ICIS news]
LONDON (ICIS)--BASF's force majeure on butanediol (BDO) and its derivatives at the company's 190,000 tonne/year plant in Ludwigshafen, Germany, is likely to remain in place until the end of August, the chemicals major said on Tuesday.
Its customers are on an allocation quota to receive one third of their regular offtake over the last 12 months, a source at the company said.
BASF’s Ludwigshafen facility is currently not producing BDO because of a lack of the raw material, acetylene. Production of the feedstock was disrupted following a fire which happened in a precursor plant at the facility on 30 May.
BASF, Europe's largest BDO producer, declared force majeure on 31 May.
The source said that engineers are currently working on the acetylene plant. “We are working 24-7 on the repair works, but it will take some time to get the plant back up and running,” the source said.
Availability has been limited so far this quarter, and the outage at BASF has tightened the market further.
Market players are now looking ahead to third-quarter pricing. One seller indicated it is considering targeting a €200/tonne increase for contracts in the coming quarter, owing to the global supply shortage and healthy demand.
Second-quarter European BDO contract prices rose by €200/tonne ($290/tonne) from the first quarter to settle at €2,050–2,100/tonne FD (free delivered) NWE (northwest Europe), because of tight supply and strong demand.
Other major European BDO producers include Lyondell Chemie Nederland and ISP Marl.
($1 = €0.69)
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