Special

Report

Phthalic Anhydride: A Techno-Commercial Profile

Part 2: International Scenario
PANKAJ DUTIA

E-mail: pankaj@chemicalweekly.com
Global capacity
The total global capacity for phthalic
anhydride (PAN) is estimated to be about
4.16-mtpa in 2007, of which 28% is in the
Europe, 22% in the US, 49% in Asia region
and the balance 1% in the Middle East.
Within Asia, China has 13% of total capacity, followed by Korea, (9%), India (6%)
and Japan (8%).Total production in 2007
is estimated at 3.65-mt, indicating a capacity utilisation of 88% during the year.
Aekyung Petrochemicals and DC Petrochemical in Korea, Taiwan Oil and Nan
Ya Plastics in Taiwan, IG Petro and
Thirumalai Chemicals in India, BASF in
Germany, Exxon Mobil, Sunoco, Stepan,
Sterling Chemicals and Koppers Industries in the US are the leading players
having capacities of above 100,000-tpa.
These 12 companies together constitute
36% of total capacity.
Recent developments
BASF closed its plant at Feluy, Belgium, in 2005. In May 2006, Krasitel restarted its plant after a years outage.
Kemiplas Hungarian plant restarted in
Jan 2007 following a nine-month outage
after a catalyst change. Lonza has put
its polymer intermediates business into
new entity, Polynt.
In China recently, Zhejiang Qingan
Chemical Industry Co., Ltd. (Zhejiang
Qingan) commenced trial run on its
50,000-tpa PAN and DOP (dioctyl phthalate) project in Jiaxing, Zhejiang province. Both projects have entered the
commercial operation stage. Zhejiang
Qingan is jointly established by Henan
Qingan Chemical High-tech Co., Ltd. and
North America Wealth International
Trade (Group) Co., Ltd. Henan Qingan

Chemical High-tech Co., Ltd. is engaged

in plasticizer and PAN production, with
annual capacity of 100 000-tpa for plasticizers and 600,000-tpa for PAN. After
completion, the two projects will help
the company increase its sales revenue
by RMB1-bn per year.
Table 1
Regional share of the global
capacity
Region

Share [%]

Europe
USA
Middle East & Africa
Asia
w China
w Korea
w India
w Japan
w Other Asian countries

28
22
1
49
13
9
6
8
13

Total [4.16-mtpa]

100

Technology
The route via o-xylene (OX) has
played a dominant role and has largely
superseded naphthalene-based technology, which accounts for about 16% of
production. OX is catalytically oxidised
in a fixed-bed reactor and the reactor effluent containing PAN vapours is cooled
and sublimated in condensers. The crude
PAN is purified in a vacuum distillation
system and the product is either stored
in a molten state or bagged as flakes.
There has been little change in process technology, although research continues to focus on catalyst improvements. One development has been the
lowering of air to OX weight ratio, which
is now 9.5:1, and allows lower capital
costs and energy savings.
Demand trends
World consumption of PAN was more
than 3.5-mt in 2006. Global capacity uti-

Table 2
Phthalic anhydride capacity in North & South America
[Kilotons per year]
Company

Location

North America
ExxonMobil Chemical
Sunoco
Stepan
Sterling Chemicals BASF
Koppers Industries
Mexico

Baton Rouge, LA
Pasadena, TX
Millsdale, IL
Texas City, TX
Cicero, IL

South America
Argentina
Brazil
Chile
Columbia
Venezuela

Capacity
667
145
130
108
104
100
80
254
40
135
10
23
46

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Table 3
Phthalic anhydride capacity in Europe
[Kilotons per year]
Company

Location

Angarsk Petrochemical
Arkema
Atmosa Petrochemie
Avdeevsky Koksokhimichesky Zavod
BASF
Cepsa
Destilacija Teslic
Deza
ExxonMobil
JSC Ural Chemical
Kemiplas

Angarsk, Russia
Chauny, France
Schwechat, Austria
Avdeevka, Ukraine
Ludwigshafen, Germany
Algeciras, Spain
Teslic, Bosnia-Herzegovina
Valasske Me
Botlek, Netherlands
Nizhnly Tagil, Russia
Fuzfogyartelep, Hungary
Koper, Slovenia
Rubezhansk, Ukraine
Lida, Belarus
Krefeid, Germany
Rimnicu, Vilcea, Romania
Ruse, Bulgaria
Nol, Sweden
Brazi, Romania
Omsk, Russia
San Giovanni Valdarno, Italy
Scanzorosciate, Italy
Ostend, Belgium
Salavat, Russia
Bratislava, Slovakia
Perm, Russia
Zelzate, Belgium
Novokuznetsk, Russia
Kedzierzyn, Poland

Krasitel
Lakokraska
Lanxess
Oitchim
Orgachim
Perstorp Oxo
Petrobrazi
Polymer Pack
Polynt
ProvironFtal
Salavatnefteorgsintez
Slovnaft
Uralkhimprom
VFT Belgium
West-Siberian Steel
ZA Kedzierzyn

Capacity
15
90
50
25
110
30
16
75
7
20
32
25
26
85
20
20
35
35
40
30
80
100
15
40
75
20
10
24

Total
lization was slightly higher in 2006 than
in the previous year, because of a slower
pace of capacity expansions and moderate world demand. Between 2003 and
2006, world capacity for PAN grew at an
average annual rate of 1.5%, trailing world
consumption. Increased demand in some
regions, mainly Asia, was balanced by
moderate demand in the United States
and Western Europe and weak demand
in Japan.
The largest net importing region for

1185
Other
Unsaturated
Polyester
Resins
Plasticizers
Alkyd
Resins

Figure 1: End-use applications for PAN

PAN is Southeast Asia; China is the largest importing country. The largest exporting countries are Taiwan, India and
the Republic of Korea.
Plasticizers account for the majority
of world consumption of PAN (57%), followed by alkyd resins and unsaturated
polyester resins (UPR) at 16% and 17%
respectively. Other smaller-volume applications include polyester polyols, saccharin, pigments, dyes and flame retardants, which together account for the
balance 10%. Demand for most downstream markets for PAN is greatly influenced by general economic conditions.
As a result, demand for PAN largely follows the patterns of the leading world
economies. Consumption of PAN depends heavily on construction/remodeling activity (residential and non-residential), automotive production and original
equipment manufacture (OEM).
During 2003-06, global consumption
of phthalic anhydride grew by 2.3% annually. During this period, global demand
was propelled by strong demand in Asia
for all its applications. Global demand is
forecast to grow at a CAGR of 2.9% during 2006-11 with a growth of 3.5-3.6% in
Asia Pacific, 1.5-2.0% in the US and 1.0%
in Western Europe.
While demand growth will be moderate in the US and marginal in Western Europe, it will be driven by the
plasticisers and unsaturated polyester resins segments in Asia. Continuing rapid demand growth in some regions, particularly in Asia (excluding
Japan), mainly for plasticizers and
UPR, will balance out moderate growth
in some markets, such as the United
States, and marginal growth in Western Europe. Weakening demand for
PAN in plasticizers and negative
growth for alkyd resins are the main
factors behind slower demand in the
United States and Western Europe.
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Table 4
Phthalic anhydride capacity in Asia, Middle East & Africa
[Kilotons per year]
Company
Middle East
Africa
South Africa
Asia-Pacific
China
India
IG Petrochemicals
Thirumalai Chemicals Ltd.
Asian Paints Ltd.
Schenectady Herdillia Ltd.
Mysore petrochemicals
Indonesia
Petrowidada
Japan
Japan Phthalic
Kawasaki Kasei
Nippon Steel Chemical
Nippon Steel Chemical
Nippon Shokubai
Kawasaki Steel
Korea
Aekyung Petrochemical
DC Petrochemical
LG Petrochemical
Others
Malaysia
Philippines
Taiwan
Taiwan Oil
Nan Ya Plastics
Union Petrochemical
Union Petrochemical

Location

Capacity
40
14
14
2004
540

Maharashtra
Tamil Nadu
Gujarat
Maharashtra
Karnataka

120
100
25
10
12
70

Mizushima
Kawasaki
Kitakyushu
Sakai
Hieji
Chiba

80
80
44
34
44
40

Ulsan
Pohang
Yeochon

180
155
50
10
50
20

BASF Petronas
Hsien-Hsi Hsiang
Mailiao
Linyuan
Taipei

Price trends
PAN prices generally fall in line with
the price of its feedstock OX. Over the
last six years PAN prices have gone up
from US$620 per ton in 2002-03 to
US$1190 per ton in 2006-07 and are expected to touch around US$1,300 per ton
in 2007-08 due to robust demand for PAN
and spiraling prices of OX.
Recently, PAN prices in Southeast

130
100
80
30

Asia were on a downtrend, in line with

OX prices. PAN prices dropped 12.6% to
$1,190-1,220 per ton CFR (cost and
freight) SE Asia in November 2007.
PAN prices in China were also on a
downtrend, reflecting price drops in domestic Chinese prices. Volumes to China
continued to be limited, due to the wide
price gap between imports and domestic cargoes.

Chemical Weekly January 8, 2008

Report

Table 5
Phthalic anhydride: Price
trends
[US$ per ton]
Year

Price

2002-03
2003-04
2004-05
2005-06
2006-07
2007-08E

620
600
900
900
1,190
1,300

The European PAN market was extremely tight in August 2007 as a result
of planned and unplanned shutdowns both
in August and the preceding months.
Contract prices fell despite the tight conditions as feedstock OX shed Euro 67 per
ton, but freely negotiated contracts did
not follow the full OX movement. In September, the market recovered very
quickly and with the majority of lost production back onstream, prices in both
the spot and contract markets fell dramatically as OX continued its swift descent. The downward trend continued
through October and while contract
prices were now more or less moving in
line with the upstream market, a substantial volume of imported material put
the spot flake market under considerable
pressure. Downward pressure was still
evident in early November as OX prices
were still trending down and cheap offers
for flaked material were still on offer.
US PAN (molten) prices in November were at 57.50-62.50 cents/lb
(US$1,268-1,378 per ton), down by 5.50
cents/lb from August, due to a softening in feedstock OX prices. PAN demand is expected to drop in the fourth
quarter amid a seasonal slowdown in
downstream markets. PAN consumption has already softened in the alkyd
paint and unsaturated polyester resin
sectors, while consumption in the
plasticiser segment is expected to
slow down.
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