08 November 2013 19:28 [Source: ICIS news]
LONDON (ICIS)--Market participants on Friday offered mixed views on Sasol's announcement this week that it will mothball an isopropanol (IPA) plant in Germany, with some traders saying the move will not affect supply or prices, while another source warned that up to 50,000 tonnes/year of IPA capacity could be taken off the market.
The South Africa-headquartered chemical firm said on Monday that its IPA plant in ?xml:namespace>
ICIS data show that the
A Sasol spokesman confirmed that the company has a total capacity of 240,000 tonnes/year but did not clarify whether the figure will remain the same after the shutdown of the
However, the spokesman said: “The planned mothballing of our Herne IPA plant will not impact our ability to supply our current and expected future demand.”
The company has said that the measure is part of a larger initiative to improve the economic performance of its German solvents business in response to an “increasingly challenging” feedstock environment and weak demand for its products.
Some IPA traders and buyers said Sasol's plan to consolidate production from two plants to one will save the company on costs. This is also not expected to have any major impact on the supply and price of IPA, they said.
“There’s already enough capacity in their
Novapex, another IPA producer, is boosting its production capacity at its plant in
Another 30,000 tonnes/year of capacity may be added after 2016 if demand continues to grow, a Novapex source has said previously.
Other market sources said Sasol’s IPA consolidation could have some downside effects on the market.
“For IPA, [Sasol] will surely try to switch some production volumes to
Another source said closing one plant means that Sasol will no longer have a back-up plant if the other plant has production problems.
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