USES
About 95% of ethylene dichloride (EDC) is used to make vinyl
chloride monomer (VCM), most of which goes into polyvinyl
chloride (PVC) production. Many EDC plants are integrated
with VCM production.
The remaining EDC goes into the manufacture of chlorinated solvents.
SUPPLY/DEMAND
There has been no
improvement in demand for EDC in Europe this year, say
players. The sector is very heavily dependent on the fortunes
of PVC, which has been badly hit by the slump in the
construction and automotive sectors, and consumption remains
weak.
Supply has lengthened and is now higher than demand. This contrasts with a tight market in the second quater (Q2) and Q3, when chlor-alkali, and hence EDC, production was cut back severely because of plummeting caustic soda values. Caustic has since recovered, prompting more supply of chlor-alkali and EDC.
Several production problems persist in Europe up and down the chain. French producer Arkema had to prolong its force majeure last week on PVC because of VCM production problems at Lavera, France. US producer Dow Chemical declared force majeure in early October on caustic soda after technical issues at Schkopau, Germany, at the same time as the UK's INEOS ChlorVinyls lifted its PVC force majeure in Norway after a 10-week outage.
Spain's Ercros has closed its plant in Huelva, Spain, this year as part of a restructuring program across Europe.
PRICES
European prices have recovered from the historic lows seen in
early 2009. Spot prices in early October were $430-440/tonne,
although levels were dropping below $400/tonne mid-month
because of weaker ethylene prices, as well as falling
downstream VCM and PVC spot numbers.
TECHNOLOGY
EDC is made by the
chlorination of ethylene in one of two processes: direct
chlorination using pure chlorine and ethylene, or
oxychlorination, where ethylene reacts with chlorine in
hydrogen chloride. Many EDC/VCM plants use a combination of
these processes to consume the hydrogen chloride by-product
from cracking EDC to VCM. A high-temperature direct
chlorination process has been developed by VinTec, owned by
German producer Vinnolit, and commericalized in
2006 at Belgian producer LVM.
OUTLOOK
Sources expect the market to
fall further in Q4, with no improvement predicted until
mid-2010. Europe has more than enough capacity to meet its
present and future needs, with any extra only likely from
small debottleneckings. New investment is focused on the
Middle East and Asia.
More consolidation is forecast, particularly in eastern Europe, where quality and infrastructure problems hamper business. Confusion persists over EDC operations in Italy and it is doubtful that some plants will restart as a result of financial and political wrangling.
The European PVC sector remains oversupplied and rationalization is still required.
WEST EUROPEAN EDC CAPACITY '000 TONNES/YEAR
Company | Location | Capacity |
Arkema | Jarrie, France | 140 |
Lavera, France | 670 | |
Dow Chemical | Schkopau, Germany | 255 |
Stade, Germany | 260 | |
Eko Chemicals | Thessaloniki, Greece | 45 |
Ercros | Vilaseca, Spain | 260 |
Evonik Industries | Lulsdorf, Germany | 150 |
INEOS ChlorVinyls | Rafnes, Norway | 735 |
Runcorn, UK | 600 | |
Wilhelmshaven, Germany | 420 | |
Stenungsund, Sweden | 240 | |
LVM | Tessenderlo, Belgium | 1180 |
Petkim | Aliaga, Turkey | 140 |
Safi | Porto Torres, Italy | 160 |
Ravenna, Italy | 75 | |
Shin-Etsu | Botlek, Netherlands | 840 |
Societe du Chlorure de Vinyle de Fos | Fos, France | 610 |
SolVin | Antwerp, Belgium | 275 |
Jemeppe, Belgium | 480 | |
Rheinberg, Germany | 410 | |
Tavaux, France | 550 | |
Syndial | Assemini, Italy | 180 |
Priolo, Italy | 175 | |
Vestolit | Marl, Germany | 580 |
Vinilis | Martorell, Spain | 490 |
Vinnolit | Gendorf, Germany | 350 |
Knapsack, Germany | 545 | |
Vinyls Italia | Porto Marghera, Italy | 400 |
SOURCE: ICIS PLANTS & PROJECTS |
Profile last published November 10, 2003
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