Asian Chemical Profile: PMMA

10 September 2012 00:00  [Source: ICB]

USES

Polymethyl methacrylate (PMMA) is the most important application for methyl methacrylate (MMA). Once cast or moulded it is clear, hard, UV transparent and resistant to gamma rays. It is an economical alternative to polycarbonate (PC) when extreme strength is not required.

PMMA comes in mainly two grades - general purpose (GP) and optical grade.

GP-grade PMMA is a material widely used in many industries and a large number of everyday/household applications, such as souvenirs, illuminated signs and bathtubs. Its automotive applications include car tail lights and speedometer covers.

Optical-grade PMMA is used to make television (TV) screens for large LED (light emitting diode) TVs, light guide panels (LGP) and computer monitors. It is also found in application screens for smaller electronics items such as mobile phones, mp3, and media players.

SUPPLY/DEMAND

Demand has dropped significantly from breakneck levels in 2010. Back in February to Sept 2010, most PMMA makers in Asia had tipped the production scale in favour of optical-grade material, leaving GP-grade supply extremely tight from February 2010.

Optical-grade PMMA demand was then increasing from China, which will soon be the main market for flat screen panel production. LED TVs are the latest products in visual entertainment, requiring optical-grade PMMA.

A domestic credit crunch that ensued in China in the aftermath of the lending binge in 2009 has stifled demand of finished PMMA products.

An unwelcome combination of a weak US economy, the ongoing eurozone debt crisis and a slowdown in the Chinese economy has led to a significant pullback in consumption of Asian PMMA since late 2011.

PRICES

Asian PMMA prices have fallen by 18.5% or $600/tonne from their peak seen in mid-May 2011 of $3,230-3,280/tonne CFR (cost & freight) SE (southeast) Asia, to $2,600-2,700/tonne CFR SE Asia in the week ended 23 August, due to weak demand.

GP PMMA prices on a CFR China basis plunged a whopping 25% or $785/tonne to $2,250-2,400/tonne over the same period.

Asian PMMA prices may be under further downward pressure because of lower consumption rates and possible increased supply from the start-up of Japan-based Sumitomo Chemical's 50,000 tonne/year new line in Singapore in the third quarter of this year, as well as other expansion projects in the pipeline.

TECHNOLOGY

Chemically, PMMA it is the synthetic polymer of MMA. PMMA is routinely produced by emulsion polymerisation, solution polymerisation, suspension polymerisation and bulk polymerisation.

For glazing, some MMA can be pre-polymerised in a continuous stirred tank reactor and the resulting viscous liquid is fed into a series of flat glass plate-like moulds. This type of batch operation is cumbersome, so continuous polymerisation/cast technologies are also in operation. In belt polymerisation processes, the MMA/PMMA syrup is injected between continuous highly polished metal belts. Continuous and batch solution processes are also known.

Japan's Mitsubishi Rayon has developed a recycling process that produces MMA monomer from waste PMMA using sand as a thermal catalyst, and then produces PMMA again from the monomer.

OUTLOOK

Asian PMMA prices are expected to remain soft to stable in view of persistently weak downstream demand, said market sources.

Although most producers in Asia are reluctant to decrease prices further, many producers outside of China said they are unable to compete with Chinese domestic GP PMMA producers which are offering low prices to move volumes.

Japanese producers also face additional strain from the yen's appreciation. A strong currency is a bane for exports as it effectively makes the products being shipped out more expensive and therefore, less competitive in the market.

Chinese feedstock domestic MMA prices appear to have bottomed out and there are clear indications that regional Asia MMA prices have reached a floor as well. This has the potential to increase PMMA producers' costs and thereby put further strain on their margins.


By: Junie Lin



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