28 June 2011 16:07 [Source: ICIS news]
LONDON (ICIS)--BASF has restarted butanediol (BDO) production at its site in ?xml:namespace>
BASF was able to restart parts of its feedstock acetylene plant and has since been able to restart production of BDO, albeit at minimum levels, a company source said. As such, it has been able to increase its allocation quota.
“We have increased our allocation to 45% from the initial level of 33%,” the source said.
Following a fire at a precursor plant at the facility on 30 May, the 190,000 tonne/year BDO producer declared force majeure, which it said would potentially last until the end of August.
“We can run parts of the acetylene plant, which allows BDO production to operate at low rates,” the source said. “We will keep the force majeure because there is no change in the general situation, and it might have to extend into September because of damage to the acetylene plant.”
Buyers are able to obtain the majority of their contracted material. However, there are now growing concerns regarding supply in July and August. Suppliers are not able to satisfy demand and sources say that increases of up to €200/tonne ($286/tonne) are likely in the third quarter of the year.
Offtake from the downstream polybutylene terephthalate (PBT) sector is particularly strong and buoyed by demand from the automotive industry, where it is used to manufacture most electronic components.
“Demand for PBT is really high above pre-crisis level,” a PBT producer said. A buyer from the PBT market said: “Our offtake is 15% up from last year.”
Availability in the derivative market is constrained as BASF’s force majeure on PBT is still in place, owing to a lack of feedstock BDO.
“The market is tight and our customers are on allocation, but we are trying to resolve the situation as soon as possible, a source from the company said. “We hope to be running as normal by early autumn.”
BDO is used industrially as a solvent and in the manufacture of some types of plastics, elastic fibres and polyurethane (PU).
PBT is a thermoplastic engineering polymer that is used as an insulator in the electrical and electronics industries.
($1 = €0.70)
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