US producers anticipate NBA price increases on tight supply

02 August 2014 00:10 Source:ICIS News

HOUSTON (ICIS)--A number of producers anticipate full price increases to go through on oxo-alcohol n-butanol in the US this month, due to an extremely tight supply situation. Producers had price increases on NBA due to go into effect on Friday.

In July, producers Oxea, Eastman Chemical, Dow Chemical and Sasol all separately announced that they were seeking 4 cent/lb increases on NBA. Oxea and Eastman Chemical both have sales control in place for NBA and Sasol said it would be monitoring and limiting sales through August to manage inventories.

NBA supplies are tight partially due to an ongoing force majeure at Oxea’s production facility in Bay City, Texas. Declared on 3 July, Oxea said that a malfunction in its production process meant it was unable to resume production. Market sources have said that turnarounds and production issues at other oxo-alcohol facilities in recent months have also exacerbated the tightness of supply.

The US has been importing much more NBA than usual due to the current supply situation. In May alone the US imported 10,144 tonnes of NBA, more than it did for the entirety of 2012 or 2013.

This week, multiple producers said they had no NBA available for the spot market and that the tight supply situation meant that they would go through with full 4-cent increases. One producer said that it anticipated further price increases due to the supply situation.

Major NBA producers in the US are BASF, Dow Chemical, Oxea, Eastman Chemical and Sasol. The oxo-alcohol is primarily used as an intermediate for other chemicals such as glycol ethers, butyl acetate and acrylates. Other applications include use in resins, as a fuel additive or a solvent in coatings.

By Matthew Donovan