International
Methanol supply becomes tight in Japan Chemicals is a good example. Mitsui Toatsu uses butane, primarily to produce methanol in its 132,000 have forced Japanese metric-ton-per-year plant. Last year, methanol producers to seek Mitsui Toatsu cut its butane consumption to 200,000 mBtric tons imports and overseas compared to its record high of 600,000 metric tons in 1974. production ventures Methanol supply-demand likely will become even worse in Japan this year. Availability of virtually all Representatives of Japanese metha- methanol raw materials will be lower. nol companies are turning in some Meanwhile, demand will increase. hefty expense accounts. Many of No dramatic growth is expected in them are on a worldwide travel spree, methanol's major markets, such as lining up contracts to import metha- formaldehyde. But a huge new outlet nol and investigating possible joint for Japanese methanol will be created methanol ventures outside Japan. this spring when Daicel Chemical At home, their plants are operating Industries brings on stream its at only 70 to 75% of capacity. Not 150,000 metric-ton-per-year plant to because the market isn't there. The produce acetic acid from methanol. raw material isn't. Methanol requirements for the Daicel The raw material pinch started to unit are expected to be about 30,000 hit Japanese methanol producers last metric tons per year. year. It couldn't have come at a worse Faced with dwindling raw materitime. als and increasing demand, Japanese Methanol demand—and produce methanol producers are looking tion—in Japan had been declining abroad for ways to supplement their since their 1973 record highs. Last own production. All of them are year, demand started picking up looking for methanol to import. And again. Estimates of 1979 methanol joint production ventures outside demand in Japan ranged from 1.1 Japan loom large in their future million to 1.2 million metric tons. plans. But production couldn't keep pace. Japan consistently has been a net Last year, the five Japanese methanol importer of methanol. In 1978, for producers probably turned out about instance, it imported about 188,000 910,000 metric tons of product. That's metric tons of methanol, mostly from not much more than the 907,000 Alberta Gas Chemical in Canada and metric tons produced in 1978 and falls Taesung Methanol Industry in South short of Japanese demand 200,000 to Korea. More than half of 1978's im300,000 metric tons. It also means ports came from Taesung, which is a that Japanese methanol plants op- joint venture between Japanese and erated at only an average 72.6% of South Korean interests. 1.25 million metric tons of capacity. Complete figures aren't in yet, but For Japanese methanol producers, last year Japanese methanol imports the major problem is raw material were running almost 20% ahead of supplies. Natural gas and liquefied 1978. Most came in under long-term petroleum gas (LPG) are both in very contracts with Canadian and South tight supply in Japan. And with Korean suppliers. But some repreprices rising dramatically, several sents emergency material bought on methanol producers have turned to the spot market. butane as an economical raw material Mitsubishi Corp., for instance, for methanol. bought spot methanol from China But butane supply also became last year and will buy still more from tight in Japan last year. One reason is China under long-term contract this that, with naphtha prices soaring, year. Marubeni Corp. is bringing in Japanese ethylene producers also methanol from Libya for Nishi-Nipswitched to butane cracking. Metha- pon Methanol. Meanwhile, four nol producers started feeling the re- Japanese methanol producers are sulting butane pinch in early 1979. negotiating with Libya to import What happened to Mitsui Toatsu jointly 50,000 to 60,000 metric tons
Shortages of raw materials
Methanol output has been slipping since 1973 peak Production, thousands of metric tons 1300 1 1200 1100 1000 900 800 700
1973
74
75
76
77
78
79a
80a
a C&EN estimates. Source: Ministry of International Trade & Industry
per year starting this year. Mitsui & Co. has even imported some methanol from the U.S., which itself became a net methanol importer in 1978. But over the long haul, overseas production ventures appear to be the solution to Japan's methanol problem. Producers will take a big first step later this year when they start building a mammoth 600,000 metric-ton-per-year methanol plant at Al Jubail in Saudi Arabia. The plant will be owned and operated by Saudi Methanol Co., a 50-50 joint venture between the stateowned Saudi Arabia Basic Industry Corp. (SABIC) and several Japanese interests. Japan will participate through a recently formed investment company called Japan-Saudi Arabia Methanol Co. (JASM). Mitsubishi Gas Chemical owns 44% of JASM. Japan's Overseas Economic Cooperation Fund owns 30% and four Japanese companies share the rest. After the Al Jubail plant comes on stream in 1982 or 1983, Japanese methanol producers will import 500,000 metric tons per year of its output for five years. Mitsubishi Gas probably will sell 200,000 metric tons of that on the world market. Earl Anderson, C&EN New York Jan. 21, 1980 C&EN
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