MOSCOW (MRC) -- BASF, the world's petrochemical major, has declared force majeure (FM) on the supply of n-butanol after hitting unspecified technical problems at its production plant in Ludwigshafen, Germany, according to Chemweek.
The FM was declared “with immediate effect” on 8 December by BASF in a letter to all its n-butanol customers. “Our production plant for n-butanol has encountered unforeseeable technical problems. To remedy the situation, we were forced to shut the plant down and start the necessary repair work immediately,” it said. The incident was described in the letter as being “beyond BASF’s reasonable control,” impacting its ability to supply customers with n-butanol according to its contractual obligations, it said. The FM will remain in place “until further notice.”
BASF will allocate the supply of n-butanol for the time being, and said it would continue to use all reasonable efforts to mitigate the effects of the shortage.
The tightening market for n-butanol in Europe and globally has gone “from feast to famine” at a time when demand for derivatives such as butyl acrylate, butyl acetate, and glycol ethers has been higher than usual for this time of year, according to Denis Poussin, global director/acrylic acid and acrylates at IHS Markit. Lower n-butanol supply may lead to further tightness and rising prices in those derivative markets, he says.
As MRC informed previously, BASF restarted its No. 1 steam cracker following a maintenance turnaround on September 30, 2019. The plant was shut for maintenance in mid-August, 2019. Located at Ludwigshafen in Germany, the No. 1 cracker has an ethylene production capacity of 235,000 mt/year and a propylene production capacity of 125,000 mt/year.
Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,760,950 tonnes in the first ten months of 2020, up by 3% year on year. Only high density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments increased. At the same time, PP shipments to the Russian market reached 978,870 tonnes in January-October 2020 (calculated using the formula: production minus exports plus imports minus producers' inventories as of 1 January, 2020). Supply of exclusively of PP random copolymer increased.
BASF is the leading chemical company. It produces a wide range of chemicals, for example solvents, amines, resins, glues, electronic-grade chemicals, industrial gases, basic petrochemicals and inorganic chemicals. The most important customers for this segment are the pharmaceutical, construction, textile and automotive industries.