Orthoxylene, Phthalic Anhydride & Plasticisers Chain

Chemicals Committee Meeting at APIC 2012

Kuala Lumpur, 18 May 2012
Angel Fernandez & Zhao Na , Tecnon OrbiChem

APIC2012

ORTHOXYLENE, PHTHALIC ANHYDRIDE &

PLASTICISERS CHAIN
Global Overview and Forecast of Orthoxylene
Overview, Trends and Forecast for Phthalic Anhydride
Oxo Alcohols Overview and Trends
Plasticisers Overview and Forecast
Phthalates and Non-Phthalate Plasticisers Trends

Source: Tecnon OrbiChem

APIC 2012

WORLD ORTHOXYLENE CAPACITY BY REGION

1,000 Metric Tons
6,000

Capacity x 0.90
Consumption

5,000

China
4,000

Northeast Asia
S & SE Asia

3,000

ME & Africa
East Europe

2,000

West Europe
South America

1,000

North America

0
2009 2010 2011

2012 2013 2014 2015 2016

Source: Tecnon OrbiChem

2017 2018 2019

APIC 2012

NEW ORTHOXYLENE PLANTS & EXPANSIONS

Capacity
Change
(ktpa)

Start-up
Date

240

2012

50

2013

Company

Location

Dragon Aromatics

Zhangzhou, Fujian, China

Byco Oil Pakistan Ltd

Lasbela, Pakistan

Shanghai Petrochemical (SPC)

Jinshan, Shanghai, China

100

2013

Jurong Aromatics Corp.

Jurong Island, Singapore

200

2014

100

2014

Hainan Refinery & Chemical Co. Yangpu, Hainan, China

Source: Tecnon OrbiChem

APIC 2012

WORLD PHTHALIC ANHYDRIDE SUPPLY & DEMAND

1,000 Metric Tons
6,500
6,000

Capacity

5,500

Consumption

5,000
4,500

Production

4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Source: Tecnon OrbiChem

APIC 2012

PHTHALIC ANHYDRIDE TRENDS

Phthalic anhydride downstream application areas, such as
construction, automotive and marine industries have been severely
affected by the financial crisis, especially in Europe and North
America
Some plasticisers producers are looking at production of nonphthalate plasticisers, where PA is not needed as a feedstock
Margins have been eroded as phthalic producers are unable to
pass on feedstock orthoxylene cost increases
In Asia, many plants have been forced to run at low operating
rates to reduce production losses
In Europe, while there is an estimated oversupply of phthalic
anhydride in the market, there are no plant closures announced

Source: Tecnon OrbiChem

APIC 2012

PHTHALIC ANHYDRIDE CONSUMPTION BY END USE

1,000 Metric Tons
Other Uses

3,000

Alkyd Resins
UPE Resins
2,000

1,000

0
2009 2010
2011 2012
2013 2014
2015 2016
2017 2018
2019

Source: Tecnon OrbiChem

Phthalates

APIC 2012

WORLD PLASTICISERS ALCOHOLS CONSUMPTION

1,000 Metric Tons
7,000

Miscellaneous
6,000

C7-C13

5,000

Linear Alcohols

4,000

Isodecanol

3,000

INA

2,000

2EH

1,000
0

2009

2011

Source: Tecnon OrbiChem

2015

2019

APIC 2012

WORLD 2-EH CONSUMPTION BY REGION

1,000 Metric Tons
5,000

Capacity

New capacities
coming in China

Production

4,000

China
Northeast Asia
3,000

S & SE Asia
ME & Africa

2,000

East Europe
West Europe
South America

1,000

North America
0
2009

2010 2011 2012

Source: Tecnon OrbiChem

2013 2014 2015

2016

2017 2018

2019

APIC 2012

2-ETHYLHEXANOL - WHAT NEXT?

Asia, and particularly China, is the main growth area for 2-EH on the
back of continued demand for DOP and increasing consumption in
DOTP in the recent years
China is the only area where new 2-EH plants are coming on stream.
This new capacity is raising fears in the traditional 2-EH export countries
that China could become self-sufficient in the near future
Conversely, demand in many other parts of the world is already slowing
down due to a decrease in DOP use and its substitution by other
plasticisers
Many 2-EH producers, especially those with captive DOP production,
are looking for alternatives, like producing non-phthalate plasticisers
such as TOTM, DOA and especially DOTP
2-EH consumption in 2-ethylhexyl acrylate accounts for approximately
12% of 2-EH demand worldwide

Source: Tecnon OrbiChem

APIC 2012

ISONONANOL TRENDS
The substitution of DOP by DINP has already had a significant
impact on the increase in demand for INA over the last few
years, with growth worldwide forecast to continue at around
3% annually
This would bring INA production close to total capacity in
around 5 years time
The ExxonMobil expansion to 345 ktpa in Singapore in 2011,
is so far the only announced major increase in INA capacity
However BASF has recently signed an agreement with top
local company PETRONAS to form a new entity (BASF 60%;
PETRONAS 40%) to develop and build production facilities for
isononanol in Malaysia

Source: Tecnon OrbiChem

APIC 2012

LINEAR ALCOHOLS, ISODECANOL &

MISCELLANEOUS C7-C13 PLASTICISERS ALCOHOLS,
OVERVIEW AND TRENDS
DIDP is by far the largest end-use for isodecanol accounting for
94% of the total global consumption
The total demand growth for the miscellaneous C7-C13 plasticiser
alcohols is estimated at around 7% over the next several years
This is predominantly due to the forecast growth for DPHP, and in
turn for its precursor alcohol 2-PH
BASF is by far the dominant producer of 2-PH worldwide with
production in Europe and the US, and from 2011 in China
Evonik also has a relatively small production in Germany while
Perstorp has plans to start producing 2-PH by 2014 in Sweden

Source: Tecnon OrbiChem

APIC 2012

WORLD PHTHALATE PLASTICISERS PRODUCTION

1,000 Metric Tons
11,000

Capacity

10,000
9,000

Non
Plasticisers
Alcohols
Miscellaneous
C7-C13
Linear
Phthalates

8,000
7,000
6,000
5,000
4,000

DIDP

3,000

DINP

2,000
1,000

DOP

0
2009

2010

2011

2012

Source: Tecnon OrbiChem

2013

2014

2015

2016

2017

2018

2019

DBP + DIBP

APIC 2012

DI-OCTYL PHTHALATE CONSUMPTION BY REGION

1,000 Metric Tons
4,000

China

3,500

Northeast Asia

3,000

S & SE Asia

2,500

E Europe
2,000

ME & Africa

1,500

West Europe

1,000
500

S America

N America

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

In the US after the introduction of the consumer product safety improvement act DOP demand
has been decreasing in recent years

In Europe the implementation of the new REACH regulations DOP has had a significant
negative impact on demand and it could decline as much as 9% for some time to come

In some countries in Northeast Asia DOP consumption has started to slow down or decrease in
some cases

Demand in South and Southeast Asia is expected to grow at a relatively healthy 3.5% over the
next several years

China is now estimated to grow at a similar pace compared with annual growth rates well in
excess of 5% annually in the earlier 2000s

Source: Tecnon OrbiChem

APIC 2012

DI-ISONONYL PHTHALATE TRENDS

DINP production is forecast to grow worldwide at around 3.3%
per annum through to 2020
West Europe is the main production region of DINP worldwide
and will have an estimated growth of around 3.5% during this
period
The European Commission has confirmed that DINP poses no risk
to either human health or the environment from any current use
DINP production is expected to grow in Asia over the next
several years as supply of DINPs precursor alcohol isononanol is
expected to increase in the region

Source: Tecnon OrbiChem

APIC 2012

DOP & DINP PRODUCTION BY REGION

China
24%

North America
17%

2011

China
44%
N.America
5%

South America
4%

S America
4%

DOP

DINP
Northeast Asia
18%

West Europe
30%

Northeast Asia
23%

South &
Southeast Asia
7%

China
25%

North America
15%
South America
4%

West Europe
5%
East Europe
3%

China
53%

2019

South &
Southeast Asia
7%

Source: Tecnon OrbiChem

N.America
3%
S America
4%

East Europe
3%
ME & Africa
5%

West Europe
31%

Northeast Asia
18%

Southeast Asia
11%

West Europe
3%

DOP

DINP

ME & Africa
South & 5%

Northeast Asia
17%

South &
Southeast Asia
12%

APIC 2012

OTHER C7-C13 PHTHALATE PLASTICISERS

Production of miscellaneous C7-C13 plasticisers (of which
DPHP is the largest product) is expected to show growth of around
8% annually for several years to come
BASF is the main producer of DPHP worldwide, with production in
the US and Europe and has started 2-PH production in Nanjing,
China in 2011
Perstorp is also building up DPHP production, and has plans to
produce its feedstock 2-PH, in Sweden, expected start-up 2014
DIDP is expected to grow steadily at around 2% per annum

Source: Tecnon OrbiChem

APIC 2012

NON-PHTHALATE PLASTICISERS, SOME PRODUCERS

MOVING AWAY FROM PHTHALATE PLASTICISERS?
Several plasticiser manufacturers are looking at producing and
promoting phthalate-free plasticisers as an alternative to the
traditional phthalate products and of DOP in particular
OXEA stopped DOP production in Germany in 2009 and it has plans
to increase its production of DOTP, TOTM and DOA in Europe and
from 2013 will start production of phthalate-free plasticisers in China
Eastman is now the sole DOP producer in the US, however the
company is also expanding and promoting DOTP among other
products (TOTM, DOA)
DOTP is rapidly becoming a commodity phthalate in China where its
production has surged over the last few years
BASF has also developed a non-phthalate plasticiser, DINCH
Source: Tecnon OrbiChem

APIC 2012

WHAT NEXT FOR SOME MAJOR PLAYERS IN THE

PLASTICISER MARKET?
BASF produces 2-PH, and DPHP in the US and Europe
o BASF has recently announced an agreement with PETRONAS to
produce isononanol in Malaysia
o It plans to double DINCH production capacity, at its plant in
Ludwigshafen, up to 200 ktpa
Eastman in 2011 acquired the Sterling Chemical plasticiser plant
o This plant is starting to produce non-phthalate plasticisers (including
DOTP) from Q2 2012
o Eastman is also promoting DOTP in Europe and has acquired a plant
in Estonia, where they produce benzoate plasticisers

ExxonMobil will continue to promote DINP and DIDP

o It has recently increased its INA capacity at Singapore to 345 ktpa

Source: Tecnon OrbiChem

APIC 2012

CONCLUSIONS
There is overcapacity on phthalic anhydride in Europe.
Expansions are mainly confined to China
Some 2-EH producers, particularly those with captive DOP
production, are looking for alternative end uses such as
producing non-phthalate plasticisers DOTP in particular
Key phthalate market players are focusing on a specific phthalate
products
Consumption of DOP will continue to decrease in Europe and
North America and to a lesser extent in some other areas such as
Northeast Asia. Some producers in these areas are looking to
move away from DOP production
Source: Tecnon OrbiChem

..your source of expert

chemical industry knowledge

APIC 2012

CHINESE ORTHOXYLENE, PHTHALIC ANHYDRIDE &

PLASTICISERS CHAIN
Orthoxylene Overview and Forecast
Phthalic Anhydride Overview, Forecast and Trends
2-EH Overview, Expansions and Trends
Plasticisers Market Overview

Source: Tecnon OrbiChem

APIC 2012

CHINA ORTHOXYLENE SUPPLY & DEMAND

1,000 Metric Tons
2,000

Capacity
Total
Consumption

1,500

Production

1,000

500

0
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Source: Tecnon OrbiChem

APIC 2012

NEW ORTHOXYLENE PLANTS & EXPANSIONS

Capacity
Change
(ktpa)

Start-up
Date

Company

Location

Dragon Aromatics

Zhangzhou, Fujian, China

240

late
2012

Shanghai Petrochemical (SPC)

Jinshan, Shanghai, China

100

2013

100

2014

Hainan Refinery & Chemical Co. Yangpu, Hainan, China

Source: Tecnon OrbiChem

APIC 2012

CHINA PHTHALIC ANHYDRIDE SUPPLY & DEMAND

1,000 Metric Tons
3,000

Capacity
2,500

Consumption

2,000

Production

1,500

1,000

500

0
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Source: Tecnon OrbiChem

APIC 2012

CHINESE OX-BASED PHTHALIC ANHYDRIDE

PLANTS & EXPANSIONS
Producer

Location

Taizhou Union

Taizhou, Jiangsu

Changzhou Yabang

Changzhou, Jiangsu

Wuxi Coking

Capacity
Change
(ktpa)

Start-up
Date

70

Q1 2011

100

H1 2011

Taixing, Jiangsu

50

H2 2011

Anhui Tongling

Tongling, Anhui

50

Q1 2012

Shandong Xintai Liaherd

Xintai, Shandong

50

Q2 2012

Shandong Hongxin

Zibo, Shandong

60

Q3 2012

Continental Petrochemicals

Zhuhai, Guangdong

80

late 2012/
early 2013

UPC

Liaoyang, Liaoning

140

2013

Source: Tecnon OrbiChem

APIC 2012

CHINESE PHTHALIC ANHYDRIDE

& ORTHOXYLENE PRICES
Rmb/ton
14,000
Phthalic
Anhydride
EXW

12,000
10,000

Orthoxylene
EXW

8,000
6,000
4,000
2,000
0
2007

2008

Source: Tecnon OrbiChem

2009

2010

2011

2012

APIC 2012

CHINESE 2-EH SUPPLY & DEMAND

1,000 Metric Tons
2,500
Other Uses

2,000

2-EH Acrylate
DOP

1,500

Capacity
Production

1,000

500

0
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Source: Tecnon OrbiChem

APIC 2012

CHINESE 2-EH PLANTS AND EXPANSIONS

Producer

Location

Capacity
Change
(ktpa)

Start-up
Date

Daqing Petrochemical

Daqing, Heilongjiang

75

2012

Shandong Jianlan

Zibo, Shandong

70

Q2 2012

Shandong Quilu Plasticisers

Zibo, Shandong

140

H2 2012

PetroChina Sichuan

Chengdu, Sichuan

80

H2 2012

Tianjin Bohai

Tianjin

140

Q2 2013

Baling Petrochemical

Yueyang, Hunan

120

2013

Shandong Hualu Hengsheng Group

Dezhou, Shandong

140

2013

Shandong Luxi Chemical

Liaocheng, Shandong

140

2013

Wison (Nanjing) Clean Energy

Nanjing, Jiangsu

125

Q3 2013

Anqing Petrochemical

Anqing, Anhui

110

End 2013

Source: Tecnon OrbiChem

APIC 2012

CHINESE PHTHALATE PLASTICISERS

CAPACITY & PRODUCTION
1,000 Metric Tons
4,000

Misc. C7-C13
DIDP

3,000

DBP + DIBP
DINP

2,000

DOP
Total Capacity

1,000

0
2009

2010

2011

2012

Source: Tecnon OrbiChem

2013

2014

2015

2016

2017

2018

2019

APIC 2012

NEW PHTHALATE PLASTICISERS (DOP)

PLANTS & EXPANSIONS
Capacity
Change
(ktpa)

Start-up
Date

100

July 2011

Company

Location

Tianjin Bohua Vastrde Yongli

Chemical

Tianjin

Zhejiang Hailiye

Jiaxing, Zhejiang

80

Nov 2011

Jingzhou Pearled

Jingzhou, Hubei

50

Sep 2011

Dongying Yimeide

Dongying, Shandong

100

2012

Continental Petrochemicals

Zhuhai, Guangdong

120

H2 2012

Tianjin Jinyuantai Chemical

Tianjin

200

End 2012

Shandong Chenxi
Petrochemical

Rizhao, Shandong

150

2012

Source: Tecnon OrbiChem

APIC 2012

CONCLUSIONS
Short supply of orthoxylene is expected to continue in the future
Phthalic anhydride outlook is not optimistic, due to cost pressure and
slow demand
2-EH new plants coming on stream could result in overcapacity in the
coming years and 2-EH producers are considering other potential uses
downstream
DOP still dominates the Chinese market and will continue to do so for
the foreseeable future
DINP, as a major alternative to DOP, is developing fast but its growth
could be limited by the availability of its feedstock isononanol
Demand for non-phthalate plasticisers, especially DOTP, is also
increasing rapidly but replacement of DOP as a dominant plasticiser
could take some time
Source: Tecnon OrbiChem

..your source of expert

chemical industry knowledge

APIC 2012

CHINESE 2-EH & INA CONSUMPTION

1,000 Metric Tons
2,000
Isononanol
2-EH

1,500

1,000

500

0
2009

2010

2011

Source: Tecnon OrbiChem

2012

2013

2014

2015

2016

2017

2018

2019