PROPYLENE THE NEXT FIVE YEARS For propylene, the next five years will be years of readjustment in petrochemicals. The olefin appears certain to score impressive gains in some markets, endure setbacks in others, and benefit by slow but steady growth in still others. Propylene can rest assured that its biggest single consumer, isopropyl alcohol, will inch steadily ahead. Propylene oxide, oxo chemicals, and even glycerol will gradually increase their propylene requirements over the next iive years. But for propylene the best growth prospects lie in polypropylene and cumene. Although polypropylene production hasn't grown as rapidly as producers initially hoped, it should triple by 1968. A growing list of cumenebased phenol and acetone plants, recently built and being built, will use a lot of propylene-derived cumene. There are seeds of potential, too, in such embryo products as ethylene-propylene rubber, polypropylene oxide, and acrolein, all of which could blossom into attractive propylene outlets. But it'll take time. Meanwhile, one of propylene's major outlets—tetrapropylene benzene sulfonate—has a very cloudy future. One of the country's major detergents, it degrades b u t slowly in most disposal systems, and it is a matter of much concern in water pollution control circles. Should the major soap makers shift—or b e forced to shift by legislation or public opinion—to a more degradable detergent not based on propylene tetramer, they would erase a 340 million pound market for propylene. 92
C&EN
MAY
13,
1963
Balancing the promised gains and losses, C&EN estimates propylene destined for the chemical market will increase 1 billion pounds by 1968 over this year's 3.4 billion pounds. To newcomers interested in petrochemicals, this amount may seem like a broad and easy mark. But, compared to presently available propylene capacity, it is merely a trickle. Gross propylene capacity (the total amount available) is staggering. Even so, several previously published figures exaggerated it even more. At a recent AIChE meeting in New Orleans, Monsanto's Norman Lewis made one of the best analyses of propylene capacity, saying available propylene in 1962 was 17 billion pounds. A C&EN survey shows that most observers agree closely with Mr. Lewis. The bulk of the propylene comes from refineries which crack petroleum streams to make gasoline blending stock. Annual gross propylene capacity in refineries is 17.1 billion pounds, more than 15 billion pounds from catalytic processes, the remainder from thermal processes. The amount economically recoverable—available propylene—is only 13.7 billion pounds. The remainder of the available propylene, 3.4 billion pounds, comes from cracking operations to produce ethylene. Obviously, ethylene cracking units alone could satisfy the chemical industry's requirements for propylene. Most refinery-produced propylene is used in the refinery, going into gasoline. Whether or not some of this propylene is diverted to petrochemicals depends on each refinery's evaluation of the material. Refinery economics can be complex. In general, propylene is worth 10 cents a gallon (2.3 cents a pound) in gasoline; its fuel value is only four cents a gallon (0.9 cent a pound). By comparison, propylene used to make chemicals (60 to 90% material) sells for 2.25 cents, and polymerization grade material sells for 3.5 cents a pound. Naturally, if a refiner uses his propylene in gasoline rather than merely as a fuel, he'll think twice before buying equipment needed to extract it for petrochemicals. If refiners value propylene only as a fuel, they are tempted to consider chemical propylene. Some refiners have been known to jump into and out of the chemical market by offering lower-grade material at attractive prices. But the merchant market for chemical propylene is tight. Only slightly more than half of production is sold and most of this is lower-grade product. Very little polymer-grade propylene is sold, and in some cases, companies that require 99% propylene buy dilute streams and do the purification themselves. If upgrading propylene is a company's goal, it helps to
H a j u j j j special report Despite setbacks in some markets, propylene destined for the chemical market will register a one billion pound gain by 1968. But the 4.4 billion pounds that will be produced in 1968 will represent only one fourth of today's available propylene supply
have a captive supply. A case in point is the three producers of isopropyl alcohol—Humble, Shell, and Union Carbide. Each has large supplies of propylene to upgrade this way. Isopropyl alcohol (IPA), often called the first of the petrochemicals, will continue to hold first place as a consumer of propylene. Just as IPA is important to propylene, so acetone is important to IPA. Acetone accounts for about 60% of the IPA consumed. But the recent influx of phenol-from-cumene plants, with their by-product acetone, is drastically increasing the acetone supply situation. These changes are still taking place. Too, phenol will influence propylene consumption through cumene derived from it. Thus, it's important to look at the phenol picture to understand what is happening to acetone and how it affects IPA. Phenol capacity is rapidly increasing. In 1961, synthetic phenol capacity stood at 800 million pounds, of which only 155 million pounds (19.4%) was based on cumene. Last year, synthetic phenol capacity jumped to 1.1 billion pounds. Using the cumene route, Monsanto installed 75 million pounds of capacity as part of its Chocolate Bayou complex, and Allied expanded its Frankford, Pa., plant to 110 million pounds. Those favoring noncumene routes were busy, too. Dow completed a 32 million pound plant at Kalama, Wash., using toluene as raw material, and Hooker started a 60 million pound modified Raschig unit at South Shore, Ky. MAY 13, 1963 C&EN
93
MOBIL CHEMICAL'S new ethylene-propylene unit at Beaumont, Tex., went on stream in 1961 with a capacity of 380 million pounds of ethylene and 200 million pounds of propylene. U.S. annual gross propylene capacity in refineries is 17.1 billion pounds
The cumene attraction will continue this year. Despite a recent price reduction in phenol (to H V 4 cents, initiated by Dow), two potential phenol-from-cumene producers are sticking to their plans: Clark Oil and Refining (30 million pounds at Chicago, 111.) and Skelly Oil (50 million pounds at El Dorado, Kan.). If these units are completed this year, they will boost synthetic phenol capacity to 1.15 billion pounds, 36% of it based on cumene. The total would have been higher if other proposed plants had not been dropped. Texas City Refining canceled plans to build a cumene-based phenol plant at Texas City, Tex., and Reichhold shelved the idea of a phenol unit at Tacoma, Wash, (it already has one at Tuscaloosa, Ala.). Monsanto has also phased out its Avon, Calif., operation now that Chocolate Bayou is on stream. This massive capacity will outdistance demand for the next few years, but by 1968 the gap should all but close. Last year, 757 million pounds of synthetic phenol was produced, roughly 28% of it from cumene. This year, cumene-derived phenol will tighten its grip on phenol output to 34% at the expense of other processes, while over-all synthetic production will climb to 805 million pounds. Synthetic phenol output will then continue upward, reaching 1.08 billion pounds about 1968. By then, 430 million pounds should be coming from cumene. Meanwhile, natural phenol will likely hold steady at its present 45 million pound level. Phenolic resins and bisphenol-A will provide the leverage for this growth. The never-say-die phenolics use about half of all phenol produced, and it's difficult to see anything impeding its steady 4% annual growth rate over the next five years. An estimated 695 million pounds of phenolics will be turned out this year, requiring 450 million 94
C&EN
MAY 13, 1963
pounds of phenol. By 1968, an additional 100 million pounds of phenol will find its way into phenolic resins. Bisphenol-A, on the strength of growth by polycarbonates and epoxies, will move into second spot on the phenol consumption list by 1968. Epoxies, despite their problems of price and handling, are moving ahead 10 to 12% annually. Polycarbonates are expected to reach 50 million pounds in five years. This year, a little less than 10 million pounds of the engineering plastic will be produced. Allied is the only company to make caprolactam from phenol and uses about 90 million pounds of the raw material. The big questions: Who else may be using the phenol route to caprolactam by 1968? Will Allied still be using it? Allied is considering a change, probably to cyclohexane, but no decision has been reached. Barring changes, as much as 125 million pounds of phenol could go into caprolactam in 1968, or phenol could lose this outlet completely. The alkylphenols are another danger area for phenol, thanks again to the detergent biodegradability problem. This year an estimated 137 million pounds of alkylphenols will be produced, with about half slated for the detergent market. This 65 million pound market may be lost, and if it is, it will cut phenol requirements from this year's 65 million pounds to 45 million pounds in 1968. Phenol exports slipped badly last year to about 10 million pounds, compared to 1961's 41 million pounds. But some producers feel that the lower price tags have given phenol a new lease in exports. They figure exports will hit 15 million pounds this year and then rebound to the 40 million pound level by 1968. Acetone Not Down and Out Tied as it is to the surge in cumene-derived phenol, acetone capacity this year will swell to 1.22 billion pounds. Seven acetone-from-cumene producers will account for 249 million pounds of capacity (small, however, compared to the 887 million pounds available from IPA). Some critics have called acetone a tired old product with barely enough strength left to keep its growth curve heading upward. But acetone marketers firmly believe that it has enough to maintain a 3.5 to 4% annual growth rate for the next half decade. Acetone's outlets are diverse and several are available to take up the slack should others falter. It's a good buy at its present price ( 6 x / 2 cents). Chances are, too, that it will become an even better buy, because excess capacity will bring pressure to bear on price. Acetone production won't reach present capacity levels, even by 1968. Last year was an unusually good one for the product; production rose 10% to 828 million pounds. This year, it should reach 865 million pounds, then settle back for a gradual climb to 1.03 billion pounds in 1968. As a group, chemical derivatives take more than half of acetone's output. Methyl isobutyl ketone (MIBK) is kingpin. It alone will need 170 million pounds of acetone this year. Last year, Enjay put in a new unit at Bayway, N.J., to make MIBK and MIBC (methyl isobutyl carbinol). Tennessee Eastman added a 20 million pound plant to produce MIBK and MIAK (methyl isoamyl ketone) at Kingsport, Tenn. MIBC, however, is static and will do well to maintain its present demand for acetone at 55 million pounds. Methyl methacrylate will need 130 million pounds of
a c e t o n e this year. S p a r k e d b y strong g r o w t h in coatings a n d e x p a n d i n g use in cast sheet, m o l d i n g p o w d e r , a n d latexes, m e t h a c r y l a t e s should g r o w 8.5% p e r year a n d re q u i r e 195 million p o u n d s of a c e t o n e b y 1 9 6 8 . A n o t h e r 2 2 5 million p o u n d s of a c e t o n e will go into solvents in 1 9 6 3 . Solvent g r o w t h will b e m o d e s t for t h e next five years, b u t a i d e d especially b y a p p l i c a t i o n s in vinyl resins, a c e t o n e used as a solvent will total 2 5 5 million p o u n d s in 1 9 6 8 . A c e t o n e exports w e r e u n u s u a l l y h i g h last year. After 1960 a n d 1 9 6 1 , w h e n exports w e r e 11 million a n d 15 million p o u n d s , respectively, 1962 s h i p m e n t s soared to 27 million p o u n d s , d e s p i t e r a p i d l y d e c l i n i n g prices of foreignp r o d u c e d material. But E u r o p e , too, has excess c a p a c i t y p r o b l e m s , a n d U.S. p r o d u c e r s can only h o p e t h a t a c e t o n e exports hold a 2 0 million p o u n d level. If 8 6 5 million p o u n d s of a c e t o n e is p r o d u c e d this year, w h e r e will it c o m e from? W i t h o u t analyzing t h e p h e n o l situation, it w o u l d b e a difficult q u e s t i o n to answer. But, with c u m e n e - b a s e d p h e n o l p r o d u c e r s r u n n i n g at h i g h op e r a t i n g rates to t u r n out 2 1 0 million p o u n d s of p h e n o l , t h e y will at t h e s a m e time find themselves w i t h 126 million p o u n d s of a c e t o n e on their h a n d s . Most of t h e m h a v e little, if any, c a p t i v e r e q u i r e m e n t s for a c e t o n e , a n d finding room for it on t h e m e r c h a n t m a r k e t will b e n o small task. M e a n w h i l e , t h e four c o m p a n i e s w h i c h p r o d u c e a c e t o n e from I P A will r u n at a b o u t last year's r a t e . But each h a s large c a p t i v e r e q u i r e m e n t s for a c e t o n e a n d , besides, can switch its units to other p r o d u c t s if necessary.
IPA Heads
PROPYLENE Production Millions of pounds 5000
4000
3000
2000
1000
'55
'56 '57 '58
C u m e n e r e q u i r e m e n t s for p r o p y l e n e are g r o w i n g as c u m e n e p r o d u c t i o n has skyrocketed in t h e p a s t few years.
'61 '62* '63
* C&EN estimates Source: O.S. Tariff Commission
P R O P Y L E N E Availability Amount Economically Recoverable, Ï963, Billions of Pounds
Gross Propylene Capacity, 1963, BilUons of Pounds
Higher
T h r e e of t h e s e four companies—Enjay, Shell, a n d U n i o n Carbide—make u p .the list of I P A p r o d u c e r s . Together, t h e y h a v e a b o u t 1.5 billion p o u n d s of capacity. T h e c u m e n e - p h e n o l - a c e t o n e b u i l d - u p h u r t t h e m , b u t only slightly. This year, for i n s t a n c e , t h e y will p r o d u c e a b o u t 1.28 billion p o u n d s of IPA, 4 0 million p o u n d s m o r e t h a n last year. This o p e r a t i n g rate a m o u n t s to α r e s p e c t a b l e 85% of capacity. In five years, p r o d u c t i o n could close in on r a t e d c a p a c i t y , b u t don't look for n e w p r o d u c e r s . I P A units c a n easily b e e x p a n d e d w i t h only slight d e b o t t l e necking. A c e t o n e is IPA's best customer. It will use a b o u t 7 5 0 million p o u n d s this year a n d raise its r e q u i r e m e n t s to 8 4 5 million in 1968. IPA's m a r k e t as a solvent is a k a l e i d o s c o p e of uses d o t t i n g t h e paint, varnish, l a c q u e r , a n d plastics industries. Until recently, portions of this business w e r e a series of u p s a n d d o w n s for IPA, as b u y e r s s w i t c h e d from solvent to solvent, d e p e n d i n g u p o n p r i c e . I P A m a r keters n o w say this situation has settled d o w n , t h a n k s to an attractive p r i c e t a g of 46 cents a gallon. An a s s o r t m e n t of c h e m i c a l derivatives ( x a n t h a t e s , isop r o p y l a c e t a t e , a n d t h e like) a n d d r u g s a n d p h a r m a c e u t i cals (especially t h e w e l l - k n o w n r u b b i n g alcohol) use s u b stantial a m o u n t s of IPA. I P A is also blessed w i t h an u n u s u a l l y large miscellaneous category. F o r any other c h e m i c a l , 100 million p o u n d s - p l u s m a y s o u n d h i g h for mis cellaneous applications. N o t so w i t h IPA. A m o n g t h e s e uses are soaps a n d d e t e r g e n t s ( 2 0 million p o u n d s ) , food processing ( 1 0 million p o u n d s ) , textiles, dyes, a n d r u b b e r p r o d u c t s ( 1 0 million e a c h ) , toiletries a n d cosmetics ( 1 0 m i l l i o n ) , a n d agricultural p r o d u c t s ( 1 5 million p o u n d s ) .
'59 '60
Refinery operations Thermal processes Catalytic processes Subtotals Ethylene plants Totals Source:
C$ EN
1.8 15.3 17.1 3.4 20.5
1.4 12.3 13.7 3.3 17.0
estimates
PROPYLENE End-Use Pattern Consumption,
Outlet Isopropyl alcohol Propylene oxide Dodecene Nonene Polypropylene Cumene Aery lonit rile Glycerol Epichlorohydrin Ethylene-propylene rubber Polyisoprene Heptene (for isooctyl alcohol) Butyraldehydes (by oxo process) Totals Source:
C$ EN
Millions of Pounds
1961 1070 336 480 190 102 117 35 85 40
1962 1120 364 518 219 152 160 47 76 44
___
__
—
—
1963 1150 378 524 253 215 236 108 82 49
1968 1305 562 242 190 735 332 144 110 77
5 50
89 68
30
35
40
60
190 2675
206 2941
270 3360
470 4384
estimates MAY
13,
1963
C&EN
95
ACETONE End-Use Pattern
ACETONE Production Millions of pounds 1200
Consumption, Millions of Pounds 1963 1968
Outlet Acetone Derivatives M e t h y l isobutyl k e t o n e M e t h y l isobutyl carbinol M e t h y l met hacr ylate Bisphenol-A Miscellaneous derivatives (isophorone, hexyleiie glycol, mesitvl oxide, diacetone alcohol) Subtotals
1000
170 55 130 20
190 55 195 50
75 450
95 585
100 40 45 40
105 40 65 45
225
255
45 20 125
65 20 105
190 865
190 1030
Solvents P a i n t , varnish, a n d lacquer Cellulose a c e t a t e Vinyl resins Acet ylene Subtotals Other Uses Pharmaceuticals Export s
'55 '56
'57 '58
'59 '60 '61 '62* '63*
'68*
Miscellaneous a n d i n v e n t o r y Subtotals Grand Totals So urce : C
