Benzene industry profitability to improve by 2015 – consultant
22 November 2011 16:41 [Source: ICIS news]
AMSTERDAM (ICIS)--Improvements in the profitability of the benzene industry could be seen by 2015 as global operating rates are expected to recover slightly in the next few years, a consultant said on Tuesday.
Asia is expected to become a significant exporter of benzene as it will gain a sizeable excess of capacity, said Stewart Hardy, Manager – ChemSystems Market Dynamics at US-based consultants Nexant.
?xml:namespace>South Korea will continue to be the largest exporter in Asia while Indonesia, Singapore and Thailand will switch to becoming exporters of benzene as new plants start up, he said at the 10th European Aromatics & Derivatives Conference.
The Chinese benzene market will be roughly balanced before major derivatives plants start up, said Hardy.
He added that coal-based benzene plants currently dominate benzene capacity in China but utilisation rates are low. These plants are not competitive and act as swing units that close when prices are low, keeping the Chinese market balanced.
Hardy expects North America, primarily the US, will continue to be a major benzene importer due to a reduction in benzene from pyrolysis gasoline (pygas) and toluene conversion processes. He said that additional benzene from reformate will be offset by the reduction of pygas available.
Western Europe could also have a larger deficit in benzene, depending on steam cracker closures.
The Middle East will have less of an impact on global benzene markets as derivative plants start up.
Benzene demand staged a dramatic recovery in 2010 following declines in the previous year, said Hardy. There was double-digit growth for cumene, cyclohexane and nitrobenzene, with fairly strong growth for styrene.
In 2011, growth in styrene demand in China has been offset by a weakness in other regions, while stronger growth has been seen in the phenol and nylon chains.
The 10th European Aromatics & Derivatives Conference, organised by ICIS and International eChem, is taking place in Amsterdam from 22–23 November 2011.
For more on benzene visit ICIS chemical intelligenceBy: Peter Taffe+44 20 8652 3214
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