Japan’s Showa Denko delays Oita VAM plant restart

29 March 2012 05:00  [Source: ICIS news]

SINGAPORE (ICIS)--Japan’s Showa Denko has delayed restarting its 175,000 tonne/year vinyl acetate monomer (VAM) plant in Oita indefinitely, as it suspended operations at its 695,000 tonne/year ethylene facility in Oita, a company official said on Thursday.

The VAM plant was taken off line on 17 February for planned maintenance and operations were originally scheduled to resume on 26 March. It was operating at 80% capacity prior to the shutdown.

“The restart date of the VAM plant has not been decided yet,” the official said, declining to comment on the impact of the prolonged outage on the VAM market.

VAM spot prices in northeast Asia, southeast Asia and south Asia have risen between 1.90% to 10.15% from 8-10 month lows in December 2011 to five-month highs at close to $1,100/tonne CFR (cost & freight) during the week ended 23 March, according to ICIS.

The prices rose in line with firming feedstock crude, naphtha and ethylene prices coupled with tight supply owing to a heavy plant turnaround schedule.

Buyers have downplayed the impact of Showa Denko’s prolonged VAM plant outage as their output was reduced prior to the shutdown and export volumes from Japan were limited because prices were  non-competitive.

The buying appetite for April shipment cargoes was capped at below $1,100/tonne CFR (cost & freight) NE Asia/SE Asia/south Asia, compared with offers at $1,100-1,150/tonne CFR NE Asia/SE Asia/south Asia.

Other major VAM producers in the Asian market include US-based Celanese, China’s Sichuan Vinylon Works, Japan VAM & Poval, South Korea’s Asacco, Taiwan’s Dairen Chemical Corp and Saudi Arabia’s International Vinyl Acetate Company (IVC).

By: Helen Lee
+65 6780 4359

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