Vienna — The European propylene industry is looking for additional imports in the hope of securing sufficient volumes next year as domestic output is set to drop drastically amid numerous production outages planned for 2019, sources said at the sidelines of the 52nd annual EPCA conference in Vienna Tuesday.
The US, Middle East and Asia are all considered as potential sources of molecules amid expectations of higher production in those regions.
“There will be imports in the first half of the year from the US. We expect prices to decline as [propane dehydrogentation] units should be running at full capacity next year,” a propylene consumer said.
“This year PDH units in the US have had a poor operating record. It is always the case during the start-up year. But they should be running better in 2019,” a propylene producer said.
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Additional volumes could come from the Middle East, following the start-up of the ADNOC’s 520,000 mt/year PDH plant in Abu Dhabi earlier this year and potentially from Malaysia, where Lotte is expanding capacity by 170,000 mt/year.
Several companies are planning to take down their crackers for major maintenance works in Europe at different times between February and October, which will curtail supplies of propylene.
The first steam cracker expected to undergo maintenance next year is Shell’s unit in Moerdijk in the Netherlands, starting in mid-February, S&P Global Platts reported earlier.
The cracker has the capacity to produce around 910,000 mt/year of ethylene and 510,000 mt/year of propylene.
While some derivatives units, particularly polypropylene, will try to time their works to coincide with the cracker outages, it is unlikely to balance out the loss of propylene production, sources said. Plants of other derivatives, such as oxo-alcohols and ACN, are likely to run normally next year, following works and production issues this year.
“Europe will be short — it is a given, and imports will increase. The question is whether all derivatives will be able to afford imports,” a propylene producer said.
–Maria Tsay, [email protected]
–Lara Berton, [email protected]
–Edited by Maurice Geller, [email protected]
Source: S&P Global Platts
