Updated to mid-November 2009
Asian market review by Chow Bee Lin, ICIS pricing
Average weekly prices of polymeric grade methyl di-p-phenylene isocyanate (MDI) in China fell by 1.4% from $1,700-1,800/tonne CFR (cost and freight) China in mid-August to around $1,700-1,750/tonne CFR China in mid-November, as the key refrigerator application sector entered the low production season.
However, average prices in southeast Asia (SE Asia) rose 2.4% from $1,670-1,700/tonne CFR SE Asia in mid-August to $1,700-1,750/tonne CFR SE Asia, mainly due to tight supply caused by planned plant shutdowns in Japan, South Korea and China.
Average weekly prices of monomeric MDI in northeast Asia (NE Asia) fell by about 2% from $1,950-2,000/tonne CFR China in mid-August to $1,920-1,950/tonne CFR in mid-November due to seasonally weak demand from the key synthetic leather and shoe sole application sectors.
European market review by Heidi Finch, ICIS pricing
European MDI contract prices were steady-to-firmer between August-November 2009, as producers’ attempted to recoup some margin losses sustained earlier in the year. Despite ongoing upward feedstock pressure, MDI contract prices remained stable in August at €1,450-1,500/tonne FD (free delivered) NWE (northwest Europe) due to subdued market activity during the summer holidays.
In September, improving demand in the construction and appliances sector and limited supply flexibility resulting from recent maintenance and idled capacities gave rise to average increases of €30/tonne on MDI contracts in some cases, despite the fall in benzene costs.
However, there were also some rollovers in September due to the mix of quarterly and monthly business, with prices assessed between €1,480-1,500/tonne FD. In October, prices moved up by €40/tonne to €1,520-1,540/tonne FD, driven by ongoing reasonable demand and the need for margin recovery.
In November, prices remained stable, as feedstock pressure and low profitability were offset against good availability and approaching low seasonal demand in the construction industry.
US market review by Leela Landress, ICIS pricing
MDI transaction prices in the US were largely stable in the three months to mid-November after rising 8 cents/lb in August, due to sharp increases in feedstock benzene.
After August, MDI bulk transaction prices were steady at 112-119 cents/lb, while MDI export spot prices also remained stable at 91-100 cents/lb as benzene costs stabilised and demand remained subdued.
Producers kept production levels reduced and paired with lacklustre downstream demand, prices were unchanged and expected to remain so through the end of 2009.
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Methylene di-p-phenylene isocyanate
Uses and Outlook
Methyl di-p-phenylene isocyanate (MDI) is mainly used in polyurethane foams, which account for about 80% of global consumption. Rigid foams are mostly used in construction, refrigeration, packaging and insulation. Flexible foams are used in furniture, bedding and transportation. MDI is also used to make elastomers, adhesives, sealants, coatings and plastics.
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Methylene di-p-phenylene isocyanate
Process Technologies
The main feedstock for MDI is nitrobenzene which is produced by the nitration of benzene in either a continuous or batch process. The nitrobenzene is hydrogenated to aniline which is then condensed with formaldehyde to form diphenylmethane diamine. The reaction conditions in the condensation step control the composition of the polyamine product.
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