New Middle East Phenol Acetone Capacity to Influence Trade Flows
Posted on : 15 Feb, 2017
2017 is a key year for the phenol and acetone market as the long-awaited phenol-acetone unit of Petro Rabigh in Saudi Arabia is set to come on stream. The new facility will have capacity of 250,000 and 160,000 metric tons of phenol and acetone yearly.
How will this new facility impact trade flows? Speculations suggest that European producers are expected to be affected by the new Middle East capacity. European producers are said to be considering whether to focus on market share or on margin when selling phenol and acetone – to counter the presence of Petro Rabigh.
Asia will remain the major buyer of phenol – with more than half the phenol produced to go to east Asia, some to northeastern Asia, and some to India. Turkey is also expected to be a key consumer of Petro Rabigh’s phenol and a third of Rabigh’s acetone to go into the Mideast [Turkey], with the rest exported. Some of the acetone maybe exported to Western Europe. However, these exports are expected to merely displace imports from other regions. Meanwhile Europe has limited demand for acetone coming from the larger industrial consumers in the methyl methacrylate and BPA sectors. Also demand for solvents is fragmented across a large number of small consumers that are supplied by the distribution sector.
Despite the Middle East capacity, Europe’s phenol market is expected to sustain slow but steady growth. This means a likelihood for increased acetone supply and weakening spot prices in 2017 and potentially 2018.
More on phenol/acetone trade dynamics at 14th Phenol/Acetone & Derivatives Markets on 7-8 March, 2017 in Bangkok.
For more information, contact Ms. Grace Oh at firstname.lastname@example.org or call +65 6346 9147.