InterviewMDI will be snug through 2015

14 June 2011 18:43  [Source: ICIS news]

By Clay Boswell

NEW YORK (ICIS)--MDI (methyl di-p-phenylene isocyanate) is likely to be in short supply through 2015, Peter Vanacker, head of polyurethanes business at Germany’s Bayer MaterialScience, said on Tuesday.

“There have been a lot of announcements on MDI investments for 2015 and beyond, but it’s going to be challenging for the whole industry before then,” Vanacker said.

“MDI could be quite tight,” he continued. “We see that already happening this year, and with the growth tendency that we see in the marketplace, it will intensify.”

Most MDI is consumed in the manufacture of rigid polyurethane (PU) foams used primarily for insulation in construction, refrigeration and packaging applications.

The market for MDI, which had been growing at about 6% prior to the recession, is now growing at 7%, according to Vanacker, a rate he expects to persist through the end of this decade.

Demand has recovered quickly from the recession, he said, and it continues to do so, particularly in Europe since the beginning of 2011, and in the NAFTA markets. Demand for MDI remains strong in the Asia-Pacific region, as well.

“However, I would say that I do see some slowing down in Chinese growth, recently,” he added. China’s construction sector has slowed from the high rates of recent years, but it remains strong.

Bayer has responded to the supply outlook by announcing plans to expand production in Asia and Europe.

In China, Bayer will debottleneck its MDI plant at Caojing, near Shanghai, to increase its capacity from 350,000 tonnes/year to 500,000 tonnes/year by the end of 2012.

“We are very committed to that, and it will also have a very short time line,” said Vanacker.

Bayer is also seeking permits to build another 500,000 tonne/year facility at the same site.

In Germany, Bayer will build a 220,000 tonne/year plant in Brunsbuttel, after a toluene di-isocyanate (TDI) plant there is replaced by another in Dormagen, which will employ the company’s new gas-phase phosgenation technology.

By: Clay Boswell
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