Ethyl acetate

04 October 1999 00:00 [Source: ICB]

Following poor demand and low prices earlier this year, the market for ethyl acetate is much more buoyant and predicted to grow 2.5%/year in the longer term

Uses

Ethyl acetate is an active solvent that is available in three grades: 85-88%, 99% and 99.5% (urethane grade). The most popular is 99% grade which is chiefly used in industrial lacquers and enamels, for example, in the production of photographic film, adhesives and nail varnishes. It is also used as an extraction solvent in the production of pharmaceuticals and food and as a carrier solvent for herbicides. An environmental use for ethyl acetate is in the reduction of pollution associated with wood pulping, whilst improving the economic viability.

Supply/demand

Global capacity of ethyl acetate is estimated at 1.2m tonne/year, with west European capacity just over 300 000 tonne/year. BP Amoco is building a 220 000 tonne/year ethyl acetate plant at Hull, UK, that will replace existing production at Hull and EniChem's Porto Maghera site (see table). BP Amoco markets EniChem's production and recently agreed to market Solutia's production in North America.

Worldwide demand is estimated at 900 000 tonne/year. Demand is said to be growing strongly in the second half of this year with the market reported to be in balance. It is not yet evident if major stockbuilding in preparation for Y2K is occurring, although the majority of producers anticipate this as a strong possibility and expect demand in the first quarter of 2000 to decrease as a result.

The Celanese plant at Bishop, Texas, US, was shutdown in mid-August as a precaution against Hurricane Bret. One shutdown has taken place in Asia: Showa Esterindo's plant at Merak, Indonesia, was out of production during August for readjustment, according to sources, but has been back up since early September.

Pricing

Ethyl acetate prices in Europe suffered a downturn in the first quarter of the year following the trend in the solvents market in general, as well as due to poor demand and competitively priced imports. A low of DM840-880/tonne was reached in March as buyers resisted producers' attempted hikes of DM100-110/tonne while cheap imports from Russia were plentiful.

Prices recovered in the next few months reaching a range of DM1050-1080/tonne in June and DM1150-1200/tonne in August. Strong demand in the derivatives market, combined with higher feedstock prices, were the driving force behind this substantial increase, according to producers. One major producer has announced September levels of DM1400/tonne with expectations in October of DM1500/tonne. However, it seems unlikely that buyers will accept the full proposal: a DM150-200/tonne rise is more likely to be negotiated.

Spot prices have also moved up from March levels of DM750-770/tonne FCA Rotterdam and deals have been seen at DM1120-1170/tonne FCA Rotterdam for September. Spot material is reported to be scarce by a major producer, with production problems in Russia contributing to the lack of material in the market at present.

Demand in Asia is good, with an increase in uptake reported in Thailand, Malaysia and Singapore. Spot prices are reported at a level of $530-550/tonne CFR into Southeast Asia.

US demand is steady and quite strong, with the majority of producers indicating a 3 cent/lb increase for 1 October. September prices increased 2-3 cent/lb on most accounts.

Technology

The main method in the manufacture of ethyl acetate involves the esterification of ethanol with acetic acid in the presence of a catalyst. The first commercial application of BP Amoco Chemical's new process using ethylene and acetic acid with a solid acid catalyst will be in BP's 220 000 tonne/year plant being built at Hull. Sasol plans to use Kvaerner's new process which only uses ethanol feedstock in a 50 000 tonne/year plant at Secunda. Here, the ethanol is dehydrogenated to acetaldehyde which further reacts to form ethyl acetate. Chinese National Petroleum has developed a one-step ethanol process where the ethanol is partially oxidised to acetic acid and subsequently esterified with excess ethanol.

Health & safety

High concentrations of ethyl acetate vapour can irritate the eyes, nose, throat and lungs and finally damage the liver and kidneys. Prolonged contact can cause the defatting of skin. Ethyl acetate is highly flammable and can form explosive mixtures with air. Flashback can occur as its vapours are heavier than air.

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EUROPEAN ETHYL ACETATE CAPACITIES '000 TONNE/YEAR

Producer	Location	Capacity
Western Europe
BP Amoco	Hull, UK	145
	Porto Marghera, Italy*	55
Erkimia	Tarragona, Spain	50
Lonza	Visp, Switzerland	6
Solutia	Antwerp, Belgium	12
Svensk	Domsjo, Sweden	15
Etanol
UC	Stockholm, Sweden	30
Eastern Europe
Egyesult	Budapest, Hungary	1
Vegyimuvek
Firma	Oswiecim, Poland	7
Chemiczna
Dwory
Synthesia	Pardubice,	12
	Czech Republic

*Plant is owned by EniChem and operated for BP Amoco

Source: Various

Outlook

Ethyl acetate prices are expected to remain buoyant towards the end of 1999 and will probably continue to reflect price increases in the ethylene feedstock sector. Producers anticipate good demand towards the end of 1999, with consumers expected to build up inventories in preparation for Y2K, and following this, reduced offtake in the first quarter of 2000. In the longer term, worldwide demand is predicted to increase by 2.5%/year until 2006.

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