According to research from Chemical Market Associates, Inc. (CMAI), over the next five years, phenol capacity increases of over 2 million tons are expected to reduce global phenol operating rates.
The supply growth will be aided by cumene-based production, since alternative feedstocks are not expected to begin production before 2010, which is when a unit in Southeast Asia will begin production with benzene-C4 technology, CMAI said.
According to CMAI, a lack of cumene feedstock supply helped raise prices of crude oil, benzene and propylene. The new benzene capacity that is expected to come online should lower benzene prices, but crude oil and propylene are expected to remain high.
New phenol capacity in Asia will make Northeast Asia almost equal to Europe and the U.S. in production, although Northeast Asia (namely China) will continue to be a net importer, accounting for 10 percent of global phenol demand, which will increase to 16 percent by 2011, CMAI said.
CMAI is forecasting the smaller size and greater memory storage of MP3 players to decrease the sales and growth in the polycarbonate market. The overall demand growth over the next five years is expected to be better than 2005, but far from the pre-2000 levels, CMAI said.
CMAI is a petrochemical consulting firm that provides consulting services for the petrochemical, plastics, fiber and chlor-alkali industries.
For more information, visit http://www.cmaiglobal.com/.