Chemical profile: Asia MIBK

13 October 2013 09:56 Source:ICIS Chemical Business

USES

Methyl isobutyl ketone (MIBK) is mainly used in solvent applications, primarily for surface coatings. It is also widely used as an anti-ozonant (a substance that prevents or slows down degradation due to ozone) in tyres. It is a stable, colourless liquid with a pleasant, mild odour.

Asia MIBKA solvent with a medium evaporation rate, it is an active solvent for many synthetic resins, including cellulosics, vinyl copolymers and epoxies.

It is also used in rare-metal extraction, as a process solvent for pharmaceuticals and adhesives, and as a chemical intermediate.

MIBK’s dewaxing and separating properties can be used to purify pharmaceuticals, mineral oils, tall oil, stearic acid and butanol.

SUPPLY/DEMAND

China, which imported 26,726 tonnes in 2012, is the biggest regional buyer of MIBK. Roughly 60% of the MIBK in China is turned into paraphenylenediamine (PPD), an anti-ozonant for tyres. Net exporters in Asia include South Korea, Japan and Taiwan.

The start-up of South Korean producer Kumho P&B’s expanded MIBK plant in December 2012 boosted the nation’s MIBK export volume by 2,000-3,000 tonnes a month, creating a surplus that changed the previous supply/demand equilibrium in the region and led to a surge in spot imports into China.

China’s MIBK imports in the first six months of 2013 surpassed the nation’s total import volume in 2012. According to the latest Customs data, the nation purchased 33,064 tonnes between January and July 2013, an increase of 6,338 tonnes from the 26,726 tonnes imported between January-December 2012, led by shipments from South Korea and Japan.

There are five existing MIBK producers in China with a total nameplate capacity of 94,000 tonnes/year. Market participants in China said that the country’s existing capacity, if fully utilised, can adequately meet existing demand.

However, the surge in import volumes in 2013, along with unfavourable economics, has prompted three producers to maintain reduced plant operating rates.

Japan’s Mitsui Chemicals shut its 30,000 tonne/year MIBK plant at Iwakuni-Ohtake Works in Yamaguchi prefecture on 1 October for annual maintenance. The plant will stay off line until mid-November, according to a company official. The producer’s MIBK plant was last shut for overhaul between 2 October and 22 November 2012.

PRICES

Spot prices of MIBK in Asia reflected the regional supply/demand imbalance in 2013 and diverged from those in the feedstock acetone sector. Spot MIBK prices into China, the regional benchmark, slumped by 16.3% since early December 2012 to settle at an average of $1,702.50/tonne CFR China in early October 2013. Feedstock acetone prices gained by 0.7% over the same period.

The MIBK price decline since December 2012 was spurred by the surge in regional product availability, following the capacity expansion by South Korea’s Kumho P&B, and the consequent rise in spot imports into China. The price downturn in the key China market was reflected in southeast Asia, where the prices of spot MIBK imports into countries, including Indonesia and Thailand, dropped by 9.3% over the same period to settle at $1,732.50/tonne CFR SE Asia by early October 2013.

TECHNOLOGY

There are two main routes to produce MIBK. One is a three-step process via acetone condensation, which gives diacetone alcohol that readily dehydrates to give mesityl oxide, which is then hydrogenated to MIBK.

MIBK is also produced from isopropanol in a mixed ketones process with di-isobutyl ketone (DIBK) and acetone as co-products.

Methyl isobutyl carbinol, DIBK and mesityl oxide are coproduced or recovered during the process.

OUTLOOK

Asia MIBKThe supply overhang in the Asian MIBK market is expected to continue in the near term, as downstream demand in China as well as in southeast Asia failed to keep pace with the significant increase in product availability that led to the MIBK price slump in 2013.

The decline in MIBK prices relative to feedstock acetone costs also resulted in a severe compression of Asian producers’ margins in 2013.

In the case of China, supply-demand fundamentals may worsen in 2014 as two producers, Zhongneng Petrochemical and Dongying Yimeide Chemicals, plan to bring new plants onstream in 2014. The two new MIBK plants have a combined capacity of 60,000 tonnes/year.

MIBK producers in Japan and South Korea are likely to periodically seek sales outlets in India in 2014 for their excess volumes, as they have done in 2013.

By Trisha Huang