14 December 2012 02:13 [Source: ICIS news]
MELBOURNE (ICIS)--China’s Jiangsu Sopo Chemical is capping the operating rate of its 500,000 tonne/year ethyl acetate (etac) plant at Zhenjiang in Jiangsu province at 50% because of weak market conditions, a company source said on Friday.
The producer reduced its etac output to 45-50% capacity in early December from 60% previously, in response to slow export and domestic demand for the solvent used in the manufacturing of coating, printing ink and adhesives, the source said.
Etac prices in China have been on a steady decline since early October, while the costs of feedstocks acetic acid and ethanol have stayed comparatively high, putting producers’ margins under pressure.
Domestic etac prices in eastern China have fallen by 6.3% since the week ended 12 October to settle at yuan (CNY) 5,900-6,100/tonne ($947-979/tonne) EXW (ex-works) for the week ended 14 December, according to Chemease, an ICIS service in China.
In comparison, the cost of feedstock ethanol in Jiangsu have lost 2.5% over the same period to close at CNY6,200-6,450/tonne EXW for the same week, according to Chemease data.
Jiangsu Sopo operates two acetic acid plants with combined capacities of 1m tonnes/year as well as a 500,000 tonne/year methanol plant at the same site in Zhenjiang.
The producer has cut its acetic acid output to about 50% capacity from 70% capacity previously.
($1 = CNY6.23)
Additional reporting by Elisa Fu
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