South Korea's LG Chem cuts IPA production on weak margins

17 June 2013 11:12  [Source: ICIS news]

SINGAPORE (ICIS)--South Korea’s LG Chem has lowered the operating rates at its two acetone-based isopropanol (IPA) plants in Yeosu to 70% capacity this month, from 100% in May, due to poor margins, a source close to the company said on Monday.

The company may implement in July a second round of production cuts at the plants with a combined capacity of 105,000 tonnes/year if feedstock acetone costs were to remain at high levels, the source said.

“It is not surprising that LG Chem has cut its production rates. Margins have been weak for a long time. The other producers in Asia have already done so earlier this year,” a northeast Asian trader said.

LG Chem’s 45,000 tonne/year Yeosu facility that uses the more competitively priced feedstock propylene continues to operate at 100% capacity, another market source said.

By: Yeow Pei Lin

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