SIX ORGANIC CHEMICALS
Tight supplies bring firming prices JOHN J. ELSBREE, Features Editor, Washington, D.C.
ight supplies of many basic and intermediate organic chemicals typify the organics industry thus far this year. Notable in this category are: • Benzene. • Phenol (and cumene). • Methanol. • Propylene. • Formaldehyde. • Maleic anhydride. • Styrene. • Ethylene oxide.
T
Companies cite various problems leading to this tight situation. In some cases firms have announced expansion plans—which may deter others from considering immediate expansion—and then haven't gone forward with the expansion, or not at the speed anticipated. Abetting the problem of slow construction is the multiplicity of expansion plans in the industry. Too many may be trying to expand plants or build new ones at the same time for suppliers, fabricators, and construction people to meet the demand. Chemical
firms give examples such as this: a high-pressure compressor involves an 18-month lead time today. Another consideration, of course, is that for some products the supply-demand situation can change rather quickly because of the enormous size of some of today's plants, when compared to those of just 10 or 15 years ago. One new ethylene oxide, styrene, or methanol plant, for example, can increase total industry capacity from 15 to as much as 25%. To continue the example, at mid-
Organic intermediates: demand continues upward Production, millions of pounds 1966
Acetic anhydride Acetone Acrylonitrile Alkylbenzenes Aniline 1,3 Butadiene Carbon disulfide Carbon tetrachloride Cyclohexane Dioctyl phthalates Ethanol, synthetic Ethanolamides, m o n o , di, and tri Ethylene oxide Formaldehyde, 3 7 % Maleic anhydride Methanol, synthetic Phenol, synthetic Phthalic anhydride Propylene oxide Styrene Tetrachlo methylene Urea, primary solution Vinyl acetate
1967
1597 1330
1556 1219
716 715 239
671 684 226
2922
752 648
1968*
1652 1273 1022
Low 1690 1310
1969** Medium
High
1710 1400 1025
1810 1480 1100
Low 1730 1300 1000
735 290
750 300
1970** Medium
High
1780 1400 1110
1900 1500 1200
745 300
775 315
800 330
663 263
940 710 275
2660
2957
3210
3240
3250
3350
3450
3450
694 714
734 760
720 840
765 850
830 855
720 920
785 930
875 940
1901
1777
2030
2520
2535
2560
2500
2600
2700
377
405
433
465
480
500
500
530
550
1881
1919
1985
1970
2030
2100
1950
2050
2160
208
227
245
260
250
265
280
2308 3707
230t 2614 4099
240
2327 3713
2600 4300
2850 4300
2900 4600
2700 4600
3050 4600
3100 4800
169
168
182
201
206
210
220
230
235
3269
3432 1297
3853 1450f
4100 1500
4100 1600
4200 1650
4500 1650
4600 1750
4600 1775
728 814
748 958
3192
3278
463
533
3543
606
12 675 711
840
855
865
920
940
950
3698
1050 3900
1070 4000
1080 4100
1050 4000
1100 4200
1200 4400
631
695
700
700
785
790
790
4360
4856
5270
5300
5800
5800
5800
6400
603
708
755
775
800
820
860
900
•Preliminary data. **C&EN computer forecasts and industry estimates. tEstimates from industry people indicate Tariff's preliminary figures don't reflect actual production, thus these numbers are greater than given by Tariff. Source: U.S. Tariff Commission SEPT. 1, 1969 C&EN
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year supplies of methanol were even tighter than earlier in the year—and Union Carbide raised its price to published prices (price increases, all below list, had already been made earlier in the year). Adding to the scarcity is a plant that was to be on stream by mid-year, but isn't—Hercules' 80 million gallon (530 million pound) a year plant in Iberville Parish, Louisiana. Although considerable new methanol capacity is under way, most of it is tied to very large plants that will use centrifugal compressors—of the large ammonia plant ilk. One of the newest announced plants that will use centrifugals is Borden Chemical's 70 to 100 million gallon, $20 million plant that will introduce Borden's operations at it's new petrochemical complex on the West Coast. In many cases this new technology has been frought with startup problems, as well as construction problems in some areas of the country. Louisiana has been a notable problem, as sketched in the June 13 issue of the Wall Street Journal. The Hercules plant began start up in May but as of July it still wasn't up to operating capacity, and Borden Chemical's 80 million gallon methanol expansion at Geismar began startup in mid-1968 but was still operating at three-quarters capacity 12 months later. The one plant that will undoubtedly change the whole methanol ball game, though, is Du Pont's. Du Pont's 200 million gallon (1300 million pound) plant at Beaumont, Tex., is due to come on stream early next year, if all goes well. This one plant will add something like 2 5 % to total U.S. methanol capacity. Some of the other expansions afoot in methanol are: • Georgia-Pacific Corp. is adding a 100 million gallon (660 million pound) plant at Plaquemine, La., to support its stake in formaldehyde for phenolic resins for plywood. • Escambia Chemical, recently ac-
Intermediate organics: strong first-quarter production for most Product
1968
1969
Acetic anhydride Acetone Aery Ion it rile Carbon tetrachloride Chloroethylene Dioctyl phthalates Dyes Vat yellow 2, 8.5% Acid blue 45 Direct black 38 Ethanolamines Ethylacetate 85% Ethylene oxide Formaldehyde, 37% Maleic anhydride Methanol, synthetic Phthalic anhydride Propylene oxide Tet rach lo roethy lene Urea, primary solution Vinyl acetate Xylene Ortho Para
409.8 294.7 241.1 197.5 665.8 101.3
427.2 335.3 184.3 204.6 732.7 106.0
0.90 0.18 1.65 58.8 37.5 562.7 991.9 47.0 921.6 169.0 224.6 155.5 1258.9 158.5
0.63 0.21 1.56 65.1 40.1 712.9 1001.6 48.1 983.1 180.7 261.8 155.6 1234.8 179.1
222.7 241.5
180.7 362.9
Source: U.S. Tariff Commission
quired by Air Products and Chemicals, Inc., is planning a 100 million gallon plant at Michaud, La. • Monsanto is adding a 100 million gallon plant at Texas City, Tex.; about a third of that is committed as raw material for an acetic acid plant. When these various additions come in the methanol picture will reverse, with plenty available for awhile. At that point some of the smaller plants will undoubtedly go down. Basics Benzene, in a soft position last year, is on very firm ground this year—a real turnaround from oversupply to critical supply. At midyear prices had generally moved up to or very close to list —24 cents a gallon—and another price increase looked likely for the fourth
quarter. Thus, midyear it looks like benzene will be tight for the rest of this year and very likely through the next. Major contributors to this tight situation are, of course, styrene—now in critical shortage in the U.S.—and cyclohexane demand for raw-material benzene. Production of nearly all, if not all important benzene-based chemicals is up this year. First-quarter 1969 vs. first-quarter 1968 production figures in millions of pounds are:
Aniline Cyclohexane Maleic anhydride Monochlorobenzene Styrene Synthetic phenol
Change,
1968
1969
59.4 502.9
73.7 537.9
47.0
48.1
129.4 870.3
154.7 987.9
+20 + 14
315.1
394.7
+25
% +24 + 7 +
2
Production of basic organics up about 13% this year
Acyclic Ethylene Propylene, for chemicals Cyclic Benzene Naphthalene Toluene Xylene
Production , millions of pounds 1969** High Low Medium
1966
1967
1968*
10,600 4,677
11,855 5,772
13,000 7,000
14,500 8,000
14,500 8,400
7,050 848 4,245 2,373
7,110 898 4,384 3,280
7,000 861 5,070 3,655
8,050 790 5,825 3,600
8,300 795 5,860 3,600
•Preliminary figures and estimates. **C&EN computer forecasts and industry estimates. Source: U.S. Tariff Commission 76A C&EN SEPT. 1, 1969
Low
1970** Medium
High
15,000 9,000
16,000 8,500
16,000 9,000
17,000 10,000
8,700 800 ' 5,900 3,700
8,600 795 6,500 3,700
9,000 800 6,525 3,800
9,600 815 6,600 3,900
Overall production of organic chemicals continues upward trend Cyclic IZZZZI
Acyclic I
Total
PRODUCTION 150
Billions of pounds
120
90
60
30
111111
hfWfWHH 1966
1967
1968*
1969**
Both ethylene and propylene production capacity is undergoing expansion—ethylene from a current 14 billion pounds per year to nearly 20 billion pounds by 1973. Propylene, now in tight supply, will continue to be for sometime—through 1975 according to Nelson Ockerbloom and Arthur Brownstein's newest survey of the propylene supply-demand picture. These Sun Oil people see the major reason for the continued shortage as a continuing growth in chemical uses of propylene and less production expansion than anticipated. They figure the chemical demand for propylene will grow 11.5% per year through next year. The main chemical produots putting pressure on propylene are polypropylene, cumene, acrylonitrile, and propylene oxide. First-quarter 1969 increases for some of these in millions of pounds are:
1970** 1969
1968
SALES Billions off pounds
75
Increase,
%
Polypropylene 161.6
261.0
+62
Acrylonitrile
241.1
284.3
+ 18
Propylene oxide
224.6
261.8
+ 16
60
45
30
15
1966
1967
1968*
1969*
1970*
SALES VALUE 15
Billions off dollars
12
Intermediates
9 6
3 0 1966 a
1967
Preliminary figures. C&EN computer forecasts. Source: U.S. Tariff Commission 6
Naphthalene production is going along about the same as last year thus far. First-quarter production, using U.S. Tariff figures as a benchmark, was 198.3 million pounds vs. 199.9 million pounds during the like period last year. Although the Tariff figures do indicate a greater portion of total production is coming from petroleum than last year. First-quarter production for toluene and xylenes gave mixed notices; toluene production increased from 1.1 billion pounds last year to 1.3 billion pounds this year, with a balanced market at present. Xylene production, however, fell off from 850 million pounds to 660 million pounds, probably because of the strike on the Gulf Coast.
1968*
1969*
1970*
Production of a number of intermediates increased more than 10% in the first quarter of this year vs. first-quarter last year—acetone, + 1 4 % ; acrylonitrile, + 18%; ethylene oxide, + 2 7 % ; propylene oxide, + 1 6 % ; styrene, +14%; p-xylene, + 5 0 % ; and vinyl acetate, + 13%. Ethyl acetate, chloroethylene (vinyl chloride), methanol, phthalic anhydride, and dioctyl phythalates were in the 5- to 10%-increase range. Only a few of the intermediates on Tariff's selected monthly report showed losses for the first quarter—some dyes, urea (—2%), and o-xylene (—1%). SEPT. 1, 1969 C&EN
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