The Acetic Acid report is published weekly in Asia, Europe and the US. Our locally based ICIS reporters gather news on spot and contract business, demand and supply issues, production, feedstock developments and any other influencing factors that will impact price movements. This enables ICIS to publish independent price assessments as well as news and analysis which those in the industry can use to make decisions with confidence.
Updated to Q2 2020
Early Q2 saw reduced output in China as mechanical issues plagued an export-oriented producer’s plant, in addition to scheduled maintenance shutdowns at other plants. But supply from the Middle East and southeast Asia more than made up for the shortfall amid the demand destruction as countries were locked down or came under strict social distancing measures in efforts to slow the coronavirus pandemic. Global producers implemented output cuts since April.
Demand across Asia declined overall as key importing country India extended its lockdown to slow the virus outbreak. Downstream PTA operating rates were cut due to low derivative demand amid the pandemic. The exception was Japan where demand for import cargoes rose due to domestic supply shortfalls resulting from the turnaround of Daicel Corp’s 450,000 tonne/year plant from 17 May to 22 June.
Producers have attempted to strike a better balance between supply and demand during the coronavirus crisis. For much of Q2 that was probably not too difficult because demand held up reasonably well. However, the magnitude of the widespread economic downturn resulted in excess supply, which producers are believed to have tried to trim by reducing operating rates.
Compared with many parts of the European chemicals industry, consumption of acetic acid generally held up quite well, continuing the strong demand in sectors such as hygiene applications used to counter effects of the coronavirus pandemic. However, some downstream markets such as butac and, to a lesser extent, VAM were weak, meaning that overall demand declined.
US acetic acid supplies were largely replenished in Q2 after some setbacks following a force majeure at the start of the year reduced the supply picture. While supplies were much stronger heading into what is typically the busier season for demand during Q2, both demand and market activity were slower as the coronavirus pandemic persisted, creating more available supplies in the domestic market. Exports of acetic acid remained stronger than what was seen in late 2019.
Consumption of US acetic acid remained muted since the production issues that occurred in Q1. The lasting effects of the crude oil collapse and widespread lockdown measures due to the coronavirus pandemic across much of the world further weakened demand for US material. The biggest drop off in demand came from declines in the energy sector where more consumption deterioration took place, while the product’s usage in other markets such as cleaning agents increased during Q2.
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Acetic acid, a clear colourless liquid with a pungent odour, is used as a chemical intermediate and solvent with widespread applications throughout industry.
Acetic acid is a clear, colourless, mobile liquid with a pungent odour and acidic taste. It is miscible in water and most organic solvents but insoluble in mineral oils and carbon disulphide.
Acetic acid is used as a chemical intermediate and solvent with widespread applications throughout industry. The largest outlet is vinyl acetate monomer (VAM), which is used in paints, adhesives, textiles, paper, films and chewing gum. Many VAM plants are integrated with acetic acid facilities.
The production of purified terephthalic acid (PTA) is the second largest outlet consuming 18% of acetic acid production.
There are many other applications from fragrances to foodstuffs and dyes to detergents.
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