EO and EG Updates

For the last few years, a crisis in margins has been expected in the world glycols market, as it becomes saturated by oversupply, but there is strong underlying demand in this area to support long term growth, according to results released in a recently study by Tecnon OrbiChem.

The MEG market is oversupplied by around 3.5 million tons in 2010 and 2011 (assuming that plants run at an average 90% of capacity). By 2012, however, this oversupply will have fallen to less than 3 million tons and by 2015 to below 2 million tons. By 2017, consumption is forecast to exceed capacity (at 90% utilisation) by almost 1 million tons.

In fact, further new plants will be announced between now and then and it is likely that many of these will be in China, perhaps as joint ventures with Middle East producers. New project opportunities in Saudi Arabia are slowing down as feedstock is no longer as easily or as cheaply available as it was in the past.

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Acetic Acid & Vinyl Acetate Updates

Feedstocks
Methanex rolled over its non-discounted contract price to August from July at 105 c/gal. Southern Chemical lowered its non-discounted price in August to 105 c/gal from July’s level of 107 c/ gal. Methanex rolled its Asia Pacific Contract Price to August from July at $310/ton....

Acetic Acid
The US acetic acid market continued to move along at a steady pace in July, and prices were stable compared to the second quarter. Truck prices in Europe acetic acid moved up about Euro30-40/ton, but contract talks were not settled....

Vinyl Acetate
Ineos lifted the force majeure declaration on its VAM supplies from Hull, UK, on 12 July, but the European VAM supplies remained restricted throughout the month. Spot VAM supplies in the US Gulf Coast were tight during late July amid reports of strong demand for some downstream markets....

Ethyl Acetate
Saudi Arabia’s Sipchem has signed an agreement with Rhodia to build a 100,000 tpa ethyl acetate plant at Jubail, the company said in a press statement on 4 August. Ethyl acetate prices in Europe showed signs of erosion during July, with prices dropping to around Euro820/ton FD in some locations....

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