Low-cost US ethylene to boost exports of styrene to Asia

19 June 2013 22:21  [Source: ICIS news]

HOUSTON (ICIS)--The US cost advantage in ethylene will more than offset its disadvantage in benzene, allowing it to export styrene to meet demand in Asia, a consultant said on Wednesday.

One of the processes for making styrene relies on benzene and ethylene as a feedstock, said Randy Rabenhorst, a principal at Nexant.

Rabenhorst was speaking at the ICIS US Aromatics and Derivatives Conference.

For ethylene, the advent of shale gas has increased supplies of ethane, which US crackers are increasingly using as a feedstock.

This has given US ethylene producers a cost advantage against much of the world, which relies on higher cost naphtha as a feedstock.

However, the same light-feed trend has reduced US production of benzene.

In fact, the US will become short on benzene, in part, because crackers are switching from naphtha to ethane.

Despite the outlook for US benzene, any cost disadvantage will be more than offset by the country's ethylene advantage, Rabenhorst said.

Consequently, the US will likely import benzene from Asia as a feedstock for styrene, he said. The US will then ship that styrene back to Asia, where it will be used to make polystyrene (PS).

Looking ahead, global PS demand will likely grow slowly because of competition from polypropylene (PP) and polyethylene terephthalate (PET), Rabenhorst said.

The feedstock for PS, styrene, accounts for about half of benzene demand, he said.

Demand from other derivatives should grow much faster, although they make up a smaller market for benzene consumption.

Nitrobenzene demand should rise quickly, as it is used to make aniline, a feedstock for methyl di-p-phenylene isocyanate (MDI), Rabenhorst said.

MDI, in turn, is used to make polyurethanes.

Demand should also be strong for cumene, a feedstock for phenol. Phenol, in turn, is used to make polycarbonate (PC) and epoxy resins among others.


By: Al Greenwood
+1 713 525 2645



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