Asia ACN supply outlook mixed in near term

Author: Li Li Chng

2019/10/08

SINGAPORE (ICIS)--Asia's acrylonitrile (ACN) market faces a mixed supply outlook as new production capacity in China could be balanced out with upcoming turnarounds in the region.

LEGO toys made out of ABS, a derivative of ACN. (James Gourley/REX/Shutterstock)

Spot ACN was assessed at an average of $1,590/tonne CFR (cost & freight) China and NE (northeast) Asia in the week ended 4 October, stable from the previous week, according to ICIS.

Firm talks were limited as buyers largely took a wait and see approach for more clarity on the market direction after the Golden Week holiday.

China’s Jiangsu Sailboat Petrochemical started up its new 260,000 tonne/year plant in September, bringing the producer’s total ACN capacity to 520,000 tonnes/year.

Shandong Haili Chemical restarted 8 October after shutting in March for steam pipeline issues.

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Moreover, supply from INEOS Nitriles’ Green Lake, Texas plant to Asia resumed from end September onwards after a long absence due to a force majeure, that is currently still in place.

The restart of the global producer's plant in Seal Sands, UK, has seen several delays.

Last week, ahead of the European Petrochemicals Association (EPCA) annual conference that took place 6-9 0ctober, INEOS announced the potential closure of Seal Sands ACN plant.

No timeline was given in the announcement but the initial market views in Asia were mixed on the potential closure and its impact on Asia supply.

Some market players felt if INEOS Seal Sands were to shut, some supply from the US and Asia may need to be diverted to Europe, causing some supply tightness in Asia.

Others felt global capacity will be balanced out with new capacity in Asia, particularly from China, in 2019 and 2020.

Current spot supply availability remained tight from northeast Asian producers, as they have either recently restarted from turnarounds, or will shut for turnarounds in October.

South Korea’s Tongsuh Petrochemical will shut its No 4 plant with 245,000 tonne/year capacity for a scheduled maintenance in mid-October for a month.

Taiwan’s China Petrochemical Development Corp (CPDC) will also shut its 240,000 tonne/year plant in 25 October till 15 November for a scheduled maintenance.

Focus article by Chng Li Li