THE MERCURY CELL CHLORALKALI DEADLINE – ONE YEAR ON · The European caustic soda market tightened...
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THE MERCURY CELL CHLORALKALI DEADLINE – ONE YEAR ON The European caustic soda market tightened after mercury cell plants closed in 2017, but then unexpectedly re-balanced this year. The European caustic soda market has balanced and prices have fallen in the first half of 2018 as a result of higher capacity utilization at existing plants. By Chris Barker CAUSTIC SODA CAPACITY CLOSURES 2017 Akzo Nobel Ibbenburen, Germany 110,000 dmt/year Spolana Neratovice, Czech Republic 150,000 dmt/year INOVYN Antwerp, Belgium 110,000 dmt/year Ercros Vila-seca, Spain 79,500 dmt/year Ercros Flix, Spain 84,000 dmt/year ICIS pricing and analytics solutions provides you with the information you need to understand the impact on supply as a result of planned and unplanned outages for over 60 commodities including Caustic Soda. TRACK LIVE CAUSTIC SODA GLOBAL OUTAGES INOVYN Martorell, Spain 240,000 dmt/year Replacement capacity being considered GLOBAL CAUSTIC SODA SUPPLY DISRUPTION BY MONTH (KT) August 2017 April 2018 October 2018 200 150 100 50 0 Unplanned outages Planned outages Almost 800,000 DMT/year of European caustic soda capacity closed in 2017 Visit icis.com to find out more
Transcript of THE MERCURY CELL CHLORALKALI DEADLINE – ONE YEAR ON · The European caustic soda market tightened...
THE MERCURY CELL CHLORALKALI DEADLINE – ONE YEAR ONThe European caustic soda market tightened after mercury cell plants closed in 2017, but then unexpectedly re-balanced this year. The European caustic soda market has balanced and prices have fallen in the first half of 2018 as a result of higher capacity utilization at existing plants. By Chris Barker
CAUSTIC SODA CAPACITY CLOSURES 2017
Akzo Nobel Ibbenburen, Germany
110,000 dmt/year
Spolana Neratovice, Czech Republic
150,000 dmt/year
INOVYN Antwerp, Belgium
110,000 dmt/year
Ercros Vila-seca, Spain
79,500 dmt/year
Ercros Flix, Spain
84,000 dmt/year
ICIS pricing and analytics solutions provides you with the information you need to understand the impact on supply as a result of planned and unplanned outages for over 60 commodities including Caustic Soda.
TRACK LIVE CAUSTIC SODA GLOBAL OUTAGES
INOVYN Martorell, Spain
240,000 dmt/year Replacement capacity being considered
GLOBAL CAUSTIC SODA SUPPLY DISRUPTION BY MONTH (KT)
August 2017 April 2018 October 2018
200
150
100
50
0
Unplanned outagesPlanned outages
Almost 800,000 DMT/year of European caustic soda capacity closed in 2017 Visit icis.com to find out more
Capacity Utilization in Europe
Caustic Soda Trade Data
Average chloralkali capacity utilisation rates reached almost 86% in the first half of 2018, compared to a 2006-2017 average of less than 80%. Higher capacity utilisation results in higher chlorine and caustic soda production
Trade data shows that Europe became a net importer of caustic soda in 2017, with North America as the biggest source of imports to the market
70.3
252.1
10.471.5
4.217.1
2.314.7
30.95.9
130.7
68.4
North America
Africa
Middle East
North East Asia
Asia/Pacific
South & Central America
Former USSR
EUROPE
Contributing anaylstCiaran Healy
27.3
AVERAGE CAPACITY UTILISATION RATE
68
70
72
74
76
78
80
82
84
86
88
H1 2018 rate2017 rate2016 rate2015 rate2014 rate2013 rate
Source: Eurochlor
2018 CHLORINE PRODUCTION VS 5-YEAR AVERAGE
680
700
720
740
760
780
800
820
840
860
JuneMayAprilMarchFebruaryJanuary
2013-2017 average production
2018 production
Source: Eurochlor
’000
CAUSTIC SODA FOB PRICE
0
100
200
300
400
500
600
700
Average Q3 2018Average Q3 2017-Q2 2018Average Q1 2013-Q2 2017
FOB Med priceFOB NW price
Total exports 2017 (Kdmt) 213.8
Total imports 2017 (Kdmt) 492.0
Net imports 2017 (Kdmt) 278.2
2017 Exports (Kdmt)
2017 Imports (Kdmt)
The price decreases in 2018 show the industry has absorbed the drop in nameplate capacity, in part by increasing production rates at the remaining plants.
Chlorine production in the first half of 2018 has been higher than the five-year average in Europe. Caustic soda is a co-product of chlorine and its production rate tracks the chlorine manufacturing rate.
Iberian monthly contract prices fell more than 14% from January to July 2018. European free on board (FOB) caustic soda prices dropped from unprecedented heights in late 2017 to much closer to historically normal levels in H3 2018. Mediterranean prices fell by more than a third after peaking in Q4 2017.
