Acetone Capacity ExpandsBy Xiao Ming

Stable demand growth in the worldThe acetone production in the world developed rapidly in recent years and the capacity reached 6.315 million t/a in 2005. Ineos Phenol is the largest acetone producer in the world today with a capacity of 1.037 million t/a. Sunoco comes next with a capacity of 577 000 t/a. Shell Chemical is the third by the  526 000 t/a capacity. Around 93.2% of the acetone units in the world use the cumene process, 5.2% of the acetone units use the isopropanol dehydrogenation process and 1.6% of the acetone units use other processes.    Acetone in the world is mainly used to produce bisphenol A, ACH/MMA (acetone cyanohydrin/methacrylate), MIBK (methyl isobutyl ketone), MIBC (methyl isobutyl carbinol) and isophorone and also used as solvent. The total consumption of acetone in the world was around 4.825 million tons in 2004. The consumption accounted for around 30.7% for solvent, around 29.2% for ACH/MMA, around 19.9% for bisphenol A and around 20.2% for others. It is expected that the consumption of acetone in the world will increase at an average annual rate of 4.5% in the next few years and reach 6.008 million tons in 2009. Bisphenol A and solvent are the most important consumption sectors, and the average annual growth of the consumption in the two segments will be 6.8% and 5.7% respectively.

Rapid capacity expansion in China

With the successful startup of the 120 000 t/a phenol/acetone renovation project in BlueStar New Chemical Materials Co., Ltd., Harbin Branch (CCR2006, No. 3) the capacity of acetone in China reached 390 000 t/a. Four acetone units use the cumene process and their total capacity is 303 000 t/a. The 121 000 t/a unit in Shanghai Gaoqiao Petrochemical Company Ltd. is the biggest acetone unit in China today. Quite a few local producers use the grain fermentation process in production, but due to the high production cost their operating rate is quite low.   The output of acetone in China was 350 000 tons in 2005, an increase of 41.7% over the previous year. The import amount of acetone in China reached 337 400 tons in 2005, an increase of 32.7% over the previous year. The import is mainly made from Russia, Taiwan Province, Japan, the United States and Singapore.    Owing to the rapid demand growth, many enterprises are planning to construct new acetone units or expand existing units. According to uncertain information, the 76 000 t/a acetone unit constructed by Hong Kong Kingboard Chemical Group will start production at the end of 2006. The company also plans to construct another 76 000 t/a unit in Changzhou of Jiangsu province. Jilin Petrochemical Company Ltd. intends to expand the capacity of the existing unit to 100 000 t/a in 2006. It is expected that the total capacity of acetone in China will reach around 640 000 t/a in 2010. Forthcoming remarkable changes in consumption distributionThe constant development of ACH/MMA, coatings and bisphenol A sectors in China has promoted a consumption growth of acetone in recent years. The apparent consumption of acetone in China was 501 thousand tons in 2004 and reached 687 thousand tons in 2005, an increase of 37.1% over the previous year.   Acetone as solvent is mainly used in coatings, pesticide and pharmaceutical sectors. The consumption of acetone in solvents accounted for 73% of the total in 2005. Owing to the rapid development of the coatings sector, the consumption of acetone as coatings solvent has achieved a drastic increase and the growth is higher than the growth as solvent in other sectors. With the extensive application of high-effect solvent recovery systems, it is estimated that the demand growth of acetone in solvents will be slowed down. In the pharmaceutical sector, besides the use as solvent acetone is also used to produce antibiotics, hormones and vitamin C. As great quantities of vitamin C produced in China are for export, the application of acetone in the pharmaceutical sector will be influenced by the changes in the international vitamin C market.    The consumption of acetone in ACH/MMA segment accounted for around 19% of the total in 2005. The total capacity of ACH in China is around 120 000 t/a today. The import amount of MMA reached 195 000 tons in 2005. MMA is mainly used in automobile and construction sectors. It is also used in audio/video products, pharmaceuticals and household electric appliances, as well as in the production of impact modifiers, PVC processing aids and unsaturated polyester resin modifiers. Owing to the rapid demand growth of MMA and downstream products, the consumption of acetone in this segment will still have a considerable increase in future. Some MMA producers started to use iso-butene or ethylene as raw material in recent years and the consumption of acetone in this sector will be affected.    Acetone is one of the main raw materials for the production of bisphenol A. The total capacity of bisphenol A in China is 55 000 t/a and the output is around 40 thousand tons. The consumption of acetone in this sector accounts for around 2% of the total. The import amount of bisphenol A and downstream products (epoxy resins and polycarbonates) reached around 1.27 million tons in 2005. With the constant consumption growth of bisphenol A downstream products epoxy resins and polycarbonates in electronic, construction material, automobile, communication and computer sectors, the demand of bisphenol A in China will have a drastic increase. Attracted by the huge market potential, many companies are planning to construct new bisphenol A units or expand the existing units. Bayer has launched a joint venture 100 000 t/a PC and 100 000 t/a bisphenol A project in Shanghai. Tangshan Nanbao Development Zone Economic Development Bureau will also construct a 200 000 t/a bisphenol A project. (CCR2005, No. 9) Sinopec Corp. and Mitsui Chemical of Japan signed a contract in Shanghai on October 15th, 2005. Both sides have decided to establish Shanghai Sinopec Gaoqiao Mitsui Chemical Co., Ltd. and jointly construct a 120 000 t/a bisphenol A unit. Besides, some large local petrochemical enterprises are also actively seeking partners to launch large-scale bisphenol A and PC projects. It is expected that the bisphenol A industry in China will enter a stage of rapid development in the next few years and a rapid consumption growth of acetone in China will be effectively promoted.    The consumption of MIBK in China is around 40 thousand tons a year. The domestic demand is almost totally satisfied by imports. The import amount reached 38.7 thousand tons in 2005. The 15 000 t/a MIBK unit in CNPC Jilin Petrochemical Company already started production in 2005. (CCR2005, No. 25) Mitsui Chemical of Japan also intends to construct MIBK units in China. The consumption of acetone in this segment will have an increase in future.   It is expected that the total consumption of acetone in China will reach 900 thousand - 950 thousand tons in 2010 and there will still be a considerable supply deficit. Compared with advanced countries in the world, the consumption proportion in solvents is unduly high in China. Bisphenol A, MMA and MIBK sectors are not yet well developed and the consumption of acetone is not big. With the readjustment and the development of the industrial layout, the consumption structure of acetone in China will have remarkable changes in the next 5 - 10 years. The consumption proportion in bisphenol A, MMA and MIBK will have a considerable increase whereas the consumption proportion in solvents will make a reduction.    The capacity of acetone in the world expanded significantly in recent years and will have a surplus supply in 2006. New units and expansion units are almost all concentrated in Asia. Acetone