Business
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Styrene: current overcapacity to tighten
This year, styrene producers will be operating their plants at only 79% of capacity—only a very slight improvement over 1980. Is it possible, then, that in a few short years, styrene plant operating rates will be back up over 90% and that styrene supplies will become tight again? That, according to C. Terry Cheatham, is exactly what is going to happen. Cheatham, who is petrochemicals marketing manager for Monsanto, says that throughout the 1980's, styrene will experience what large-volume commodities usually experience—periods of tightness and high prices coupled with periods of excess capacity and shrinking margins. Right now, the styrene picture is colored by overcapacity. Cheatham told a joint meeting of the Chemical Marketing Research Association and the European Chemical Marketing Research Association in New York City that capacity at the end of last year was about 8.8 billion lb. Meanwhile, production was only 6.9 billion lb, 7.8% below 1979 levels. U.S. conHigh-purity Ashland® sumption, at 5.7 billion lb, was only distilled-in-glass solvents. 88% of what it was in the previous year. High-performance Nevertheless, Cheatham is optiservice to match. mistic about styrene's future. He sees U.S. demand for the monomer growAvailable from over 80 ing at about 5% per year throughout US. locations. the eighties, with polystyrene reSend now for the maining the principal stimulus to that Ashland HPLC source book, growth. If he is right, consumption will hit 9.3 billion lb by 1990. or call our hotline: Much earlier than that, Cheatham (215) 258-9135 expects that much of last year's excess capacity will be used up rapidly. With the help of an economic upturn, styAshland, rene producers could be operating at an average 86 to 88% of capacity by the of next year. In 1984, they Ashland Chemical Companymay end happily find themselves running at 90% of capacity. At these operating rates, Cheatham Ashland Chemical Company, Dept HP warns, an unexpected shutdown that P.O. Box 2219. Columbus, OH 43216 lasts much longer than three weeks of D Send me your Ashland HPLC Solvents Catalog. any plant that produces more than 50 D Have salesman call < million lb per month can create a shortage. With Cos-Mar's 900 million lb exName pansion due on stream in 1985, U.S. styrene capacity will grow to 9.7 bilTitle lion lb. Obviously, Cos-Mar's expansion will relieve the tight supply sitCompany uation that Cheatham sees developing in the early to mid-eighties. But Address he thinks the relief will be short-lived. With U.S. demand growing at 4 to 5% City State ZIP per year, he points out that a new, world-scale plant will be required
Ooena new source1 for HPLC-grade solvents.
(DIVISION OF ASHLAND OIL. INC.
CIRCLE 92 ON READER SERVICE CARD 18
C&ENMay 18, 1981
every two to three years, even if export levels of styrene remain constant. It is difficult to forecast just what future export levels will be. It is too early to assess the full impact of crude price decontrol and the pending decontrol of natural gas, says Cheatham. Nevertheless, he expects U.S. styrene producers to lose some of their feedstock and energy cost advantages in the future. Certainly, exports have become important to U.S. styrene producers. They exported 961 million lb of monomer in 1979. In 1980, a record 1.2 billion lb of exports helped relieve the pain of a big drop in U.S. consumption. The major export markets were Mexico, Japan, and Western Europe. Cheatham says that until Mexico's expansion comes on stream next year, almost all of its monomer demand will be filled by U.S. exports. After a slight intermission, Mexico could become a net importer again by the middle of the decade. Last year, the tJ.S. exported 204
Nine companies currently produce styrene Company and plant location
Capacity (mMons of 1» par year)
American Hoechst Baton Rouge Bayport, Téx.
600 900
Amoco Texas City, Tex.
600
Arco Kobuta, Pa. Channelview, Tex.
220 1000
Cos-Mar CarviHe, La.
1300
Dow Chemical Midland, Mich. Freeport, Tex.
300 1450
ElPaso Odessa, Tex.
250
Gulf Oil Dortak&onviite, La.
600
Monsanto Texas City, Tex.
1500
USS Chemicals Houston TOTAL
120 8840
CHECKOFF million lb of monomer to Japan. Two expansions, totaling 510 million lb, will come on stream there next year. These expansions will not eliminate Japan's need to import, but they certainly will reduce it. Canada also has two styrene plants due on stream around 1985. Much of their output will be targeted for ex ports, particularly to the Far East, and will compete with U.S. material for that market. Cost, not a shortage of capacity, prodded Western Europe into im porting more than 300 million lb of U.S. styrene last year. But oil and gas decontrol may erase that cost ad vantage. On balance, Cheatham expects that the U.S. will become a net importer of about 300 million lb of styrene by 1990. New plants being built throughout the world will reduce ex port potential. And there is a possi bility of several hundred million pounds of Canadian styrene coming into the U.S. once that material be comes available. Only one thing, says Cheatham, can change his opinion that the U.S. will become a net styrene importer. T h a t is technology. Given a signifi cant breakthrough in technology, he says, the U.S. could regain its com petitive advantage. In the U.S. market, monomer growth will be triggered primarily by polystyrene, its largest single end use. Assuming there isn't another reces sion, polystyrene demand is expected to be up about 7% this year. By 1982, says Cheatham, demand again will exceed 1979 levels. And, using last year's low demand as a base, he esti mates that polystyrene demand will grow an average blk to 6% per year through 1985. After that, polysty rene's growth rate will again taper off. Acrylonitrile - butadiene - styrene copolymer and styrene-acrylonitrile polymer will follow a similar pattern. Styrene demand in these markets likely will grow to 900 million lb in 1985, from last year's weak 635 mil lion lb. In the second half of the dec ade, however, growth rates are ex pected to drop to about 4% annu ally. Styrene-butadiene rubber will be the weak link in styrene's marketing chain. Because of tire downsizing and the switch to radiais, Cheatham sees very little growth in this market. But for styrene, the future looks bright in unsaturated polyester res ins. Cheatham sees demand growing 8% annually through 1985 and 6% per year after that. D
NEW PLANTS • Butanol—Resulting from long-term supply agreement with Rohm & Haas, Union Carbide plans to add additional 200 mil lion lb per year of η-butanol ca pacity at Texas City, Tex., oxoalcohol facility by 1984. Carbide already is adding initial 200 mil lion lb of butyraldehyde/butanol capacity at Texas City, with first half scheduled to come on stream in early 1982 and rest by 1984. • Catalysts—W. R. Grace's Davison Chemical division in Baltimore plans to expand cracking catalyst additive man ufacturing facilities in multimil lion-dollar additions at Curtis Bay, Md.; Lake Charles, La.; and South Gate, Calif. Scheduled operation date for all three projects is March 1982. • Chlorine—Borden plans to build two chlorine recovery units at cost of more than $20 million at Geismar, La., to process wastes from company's nearby vinyl chloride and polyvinyl chloride units. To be finished in late 1981, project will be handled by Jacobs Engineering Group and Η. Ε. Wiese. • Ethanol—AgriFuels subsid iary of Oasis Petroleum plans to build 33 million gal-per-year (218 million lb per year) plant in New Iberia, La., at cost of $40 million to make fuel-grade fermentation ethanol from molasses, sorghum syrup, cane syrup, and bagasse. Pedco International will conduct project, scheduled for completion in third-quarter 1982. • Hydrogen—Amoco Chemi cals part of Standard Oil (Ind.) plans hydrogen recovery plant with capacity of 21 million scfd at its olefins complex in Chocolate Bayou, Tex. Product, 95% pure hydrogen, will be shipped to other Amoco plants on Gulf Coast. Completion is scheduled for late 1982, and engineering and construction contract has gone to C. F. Braun subsidiary of Santa Fe International. • Natural gas liquids—Enserch Corp. of Dallas plans to build plant near Chico, Tex., with capacity to process 30 million cu
ft of natural gas per day from various untreated streams to produce combined 3000 bbl per day of ethane, propane, butanes, and natural gasoline. Operation is scheduled to begin in fourthquarter 1981. • Polybutene—Exxon Chemi cal Americas has begun engi neering work on 67,000 ton-peryear unit for as yet unspecified location. To be completed in late 1983, plant will bring company's total polybutene capacity to about 100,000 tons per year. • Silicon—Union Carbide plans to build 1000 metric-ton-per-year polycrystalline silicon plant at unspecified location in Pacific Northwest to begin production in late 1984. Plant will use Carbide's technology for silane feedstock production and technology from Komatsu Electronic Metals Ltd. of Japan for silicon deposition. Product will be high-quality sili con ingots primarily for semi conductor industry. • Vinyl acetate—Union Car bide has completed first half of 200 million lb-per-year expansion at Texas City, Tex. Present ex pansion increases total vinyl ac etate capacity there from 350 million lb to 450 million lb; sec ond phase slated to push capacity to 550 million lb in 1982.
NEW LABORATORIES • Exxon Chemical has new $23 million chemical technology center under construction in Baytown, Tex. Space will be 90,000 sq ft in administration/ laboratory building and 70,000 sq ft in support areas. • J. M. Huber Corp, has opened a corporate plastics laboratory at Macon, Ga., to serve company divisions in fillers, clay, calcium carbonate, carbon black, and sil icas. • Kalama Chemical is con structing a new research and de velopment facility at Kalama, Wash., which ultimately will have a staff of about 25. • Pennzoil plans a $20 million technology center in Houston. Staff at full complement in about three years will be about 100 sci entists and engineers. May 18, 1981 C&EN
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