China's Shaoxing Yuandong keeps 50% of No 4 PTA plant idle

30 August 2012 09:22  [Source: ICIS news]

SINGAPORE (ICIS)--China’s Shaoxing Yuandong Petrochemical has kept half the capacity of its 1.4m tonne/year No 4 purified terephthalic acid (PTA) plant in Zhejiang province idle on concerns about margins, a company source said on Thursday.

The company shut the plant – which was running at 50% capacity since its start-up in May – on 8 August for maintenance until late this month.

“We did not restart the whole plant, although we had planned to do so, because of margins concerns,” the source said.

August PTA margins were negative for some Chinese producers, taking into consideration the contract prices of feedstock paraxylene (PX) at yuan (CNY) 10,700/tonne ($1,685/tonne), and of PTA at CNY8,200/tonne (DEL) delivered, according to ICIS.

One tonne of PTA requires 660kg of PX. With PX cost at CNY7,062/tonne, and variable cost, including freight, at CNY1,300/tonne, PTA makers are incurring losses at current prices.

One of the two 700,000 tonne/year reactors of the PTA plant was started up in May, while the other reactor was kept shut.

“So far we have no schedule for the start-up of the second reactor as that will depend on margins and market situations,” the source said.

($1 = CNY6.35)

By: Becky Zhang
+65 6780 4359

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