Chemical Industries Newsletter

December 2009

SRI Consulting - a division of Access Intelligence, LLC
Table of Contents

Cyclopentadiene/Dicyclopentadiene
Detergent Alcohols
Ethane
Ethylbenzene
Methyl Ethyl Ketone
Phosphate Rock

Styrene
Advances in Ammonia Technology
C3-C4 Oligomerization for Gasoline
Cyclic Olefin Copolymers (COC)
Plastics Additives
Rubber-Processing Chemicals
Synthetic Lubricants
ChemicalWeek Regulatory Watch
CEH Reports and Product Reviews in Preparation
PEP Reports Published in 2009
SCUP Reports Published in 2009

CEH Marketing Research Report Abstract
CYCLOPENTADIENE/DICYCLOPENTADIENE
By Henry Chinn with Takashi Kumamoto

Cyclopentadiene and its dimer, dicyclopentadiene, are obtained as by-products of the steam cracking of hydrocarbons.

The United States, Western Europe, Japan and China are the largest producing and consuming areas. Global consumption is forecast to grow at an average annual rate of 3.4% per year for 2009–2014, but will only partially make up for the drastic consumption declines of 2–20% (depending on the location) during the economic recession of 2008–2009. The overall growth in dicyclopentadiene consumption will be greatest in China, with average annual growth of 5.9% during 2009–2014. Of the major consuming countries/regions, consumption in the United States and Western Europe will increase by an average annual rate of 3.0% but this will not make up for the consumption declines of 16% and 19%, respectively, during 2008–2009. Japanese consumption will grow at an average annual rate of 1.8% during 2009–2014 and will show positive growth over 2008 levels; consumption declined by 4.4% during 2008–2009.

The following pie chart shows world consumption of dicyclopentadiene:

Sales in the primary end-use markets for dicyclopentadiene—unsaturated polyester resins, EPDM elastomers and hydrocarbon resins—depend on the performance of the general economy, and dicyclopentadiene consumption tends to swing with changes in GDP.


Production and consumption are concentrated in the United States, Western Europe and Japan but the rise of Chinese demand into traditional dicyclopentadiene markets has led to China’s becoming the fourth-largest consumer. Especially in Asia, growth in the construction, automobile and electronics industries increased consumption of dicyclopentadiene.

(For the complete marketing research report on CYCLOPENTADIENE/DICYCLOPENTADIENE, visit this report’s home page or see p. 640.5000 A of the Chemical Economics Handbook.)

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CEH Marketing Research Report Abstract
DETERGENT ALCOHOLS
By Milen Blagoev with Ralf Gubler

The 2009 global market for detergent alcohols was up slightly from 2008. This market includes mostly C12-C16 alcohols with a high degree of linearity, including C16-C20+ alcohols (mainly for personal care and oil field markets). Global demand for detergent alcohols has lagged behind recent capacity growth. With the large excess capacity that has recently come on stream, combined with the current economic crisis, average utilization rates have fallen to about 68% in 2009. In 2008 utilization rates were estimated to be about 72%, down from 81% in 2006. Utilization rates are expected to start recovering by 2011, to return to about 72% by 2013.

The continuous oversupply situation in the detergent alcohols market, combined with depressed growth potential and low margins, has increased the strain on the producers. Established producers or new market entrants were obliged to react to the global economic and financial crisis. Some, like Cognis, reduced their capacity; others, like Oleon or Mitsubishi Chemicals, exited the market altogether. Some of the planned capacity expansions were canceled, other market participants, like Domba Mas, did not commission their plants.

Among the leading competitors in synthetic alcohols (petrochemical based) are Shell Chemicals of the United Kingdom (produces only synthetic alcohols), Sasol of South Africa and BASF of Germany. In natural alcohols (oleochemical based), Cognis of Germany, Kao Corporation of Japan, LiaoNing HuaXing of China, Ecogreen Oleochemicals of Indonesia and Procter & Gamble of the United States are among the major players.

The following pie chart shows world consumption of detergent alcohols:

Over the last ten years, global demand for detergent alcohols grew on average 4.0% annually. Consumption increased especially in regions where increased availability, as a result of new production facilities, spurred demand. China, Africa (albeit from a small base), Central and South America, and Other Asia saw the strongest growth in demand. In 1998 North America accounted for 35% of the global demand; ten years later the region accounted for less than 27% of the overall consumption. The share of Western Europe declined from 38% to less than 35% over the same period of time.

It is expected that this trend will continue, as demand growth in the developing world (e.g., in Brazil, Russia, India and China) is forecast to be significantly higher than average. Over the forecast period, production is expected to shift further to China and Southeast Asia, in line with expectations for regional growth.

The profitability of the surfactant alcohol industry is currently below average for a number of reasons. Until recently, increases in raw material costs had been occurring more rapidly than producers could recover margins by increasing prices. The low average capacity utilization in 2008 depressed margins. The large excess capacity that came on stream during 2008–2009, bringing average capacity utilization rates down even lower, further reduced profitability in 2009.

(For the complete marketing research report on DETERGENT ALCOHOLS, visit this report’s home page or see p. 609.5000 A of the Chemical Economics Handbook.)

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CEH Marketing Research Report Abstract
ETHANE
By Emanuel Ormonde

Ethane is consumed as a feedstock in the production of ethylene (its largest end use, accounting for 95–99%) or as an industrial fuel (very small end use) and for other smaller uses (i.e., EOR operations). Ethane consumed in the manufacture of ethylene competes with other steam cracker feedstocks such as propane, butane, naphtha and gas oil. Most ethane occurs indigenously with other NGLs, such as propane and butane, in natural gas, either associated with crude petroleum (associated gas) or in gas reservoirs not associated with petroleum (nonassociated gas). Smaller volumes of ethane are also recovered from refinery gases generated by catalytic cracking of petroleum fractions.

The United States, Canada and the Middle East have long been the dominant producers and consumers of ethane. Western Europe and Asia have consumed much smaller amounts and Japan has essentially no market for ethane. Moreover, China consumes negligible amounts of ethane in comparison to North America and the Middle East. In the Middle East, ethane consumption has grown with additions in ethylene capacity. Feedstock prices, ethane availability, and demand for ethylene and downstream petrochemical products will help determine the future ethane producers as well as production levels.

The Middle East will continue to have the largest average annual growth rate (during the forecast period of 2009–2014) for ethane consumption as a result of the many ethane-based cracker projects coming on stream in the near term. The three major regions represent three-fourths of total ethane consumed for 2009 worldwide.

The following pie chart shows world consumption of ethane:

North America and the Middle East are the largest consumers of ethane for ethylene in the world. Other regions such as Western Europe and most of Asia use other feedstocks such as naphtha for ethylene production. The supply and cost competitiveness of ethane are key drivers for feedstock selection for steam cracking. Historically, North America and the Middle East have held most of the ethane market share.

In the Middle East, 33% of ethylene capacity in 2009 was solely ethane based, while 40% of total ethylene capacity was ethane/propane based. The Middle East is in the forefront to become the world’s major source of petrochemical products. Ethylene capacity in the region is expected to grow by around 10% per year from 2009 to 2014. The region’s vast oil and gas reserves and the current cost advantage of ethane-based ethylene production have prompted investments in petrochemical production. Because of this, the region is expecting to see an ethane price increase in the next three to four years as a result of the looming shortage of ethane supply. The Middle East will see the highest average annual growth rate for ethane consumption (7.6%) during 2009–2014.

(For the complete marketing research report on ETHANE, visit this report’s home page or see p. 360.0000 A of the Chemical Economics Handbook.)

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CEH Marketing Research Report Abstract
ETHYLBENZENE
By Sean Davis

Nearly all ethylbenzene produced in the world is used in the manufacture of styrene; therefore, ethylbenzene demand is determined primarily by styrene production. Styrene is used mostly in polymer production for polystyrene, acrylonitrile-butadiene-styrene (ABS) and styrene-acrylonitrile (SAN) resins, styrene-butadiene elastomers and latexes, and unsaturated polyester resins. The major styrene markets include packaging, electrical/electronics/appliances, construction and consumer products. Consumption of ethylbenzene for uses other than the production of styrene is estimated to be less than 1%. These applications include use as a solvent and, on occasion, in the production of diethylbenzene, acetophenone and ethyl anthraquinone.

The following pie chart shows world consumption of ethylbenzene:


Global ethylbenzene operating rates declined in 2008 as the global economic recession resulted in diminished styrene demand. In the United States, Western Europe and Japan, producers contended with rising feedstock pricing and oversupply through capacity reductions and the formation of joint ventures. In the Middle East and China, ethylbenzene/styrene capacity continues to increase to meet anticipated demand growth. Central and South American utilization rates were low in 2008 as a result of the completion of Innova’s new ethylbenzene/styrene facility in Triunfo, Brazil, which began operation late in the year, nearly doubling the region’s supply. Global operating rates should improve between 2009 and 2010 as markets slowly recover.

World ethylbenzene demand will increase at an average annual rate of 2.9% from 2008 to 2013. Consumption is expected to grow the fastest in the Middle East and China.

(For the complete marketing research report on ETHYLBENZENE, visit this report’s home page or see p. 645.3000 A of the Chemical Economics Handbook.)

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CEH Marketing Research Report Abstract
METHYL ETHYL KETONE (MEK)
By Elvira O. Camara Greiner and Chiyo Funada

Methyl ethyl ketone is a colorless, stable, flammable liquid with an odor similar to that of acetone. It is miscible with water and a variety of organic solvents. Its exceptional solvency makes it a powerful and valuable solvent for many substances, especially resinous materials.

Coating solvents continue to consume the majority of MEK. Worldwide, almost 50% of MEK was consumed for this application in 2009. There will be little change in the world MEK market breakdown by 2014. However, there are slight regional variations. Although printing inks make up only 10% of the MEK market, this application will experience the highest growth rate during 2009–2014, especially in China.

The following pie chart shows world consumption of MEK:


MEK prices seesawed during 2004–2009. A tight market and high raw material costs in 2004 and into 2005 caused prices to rise before they started falling in mid-2005 through 2007 as a result of lower demand and a more balanced supply/demand scenario. By mid-2008, escalating raw material costs sent MEK prices higher before the economic downturn (and subsequent weak demand and lower raw material costs) brought them back down in 2009.

World MEK consumption is forecast to grow at an average annual rate of 1.9% during 2009–2014. Most of that growth will come from Asia Pacific. Because of the economic downturn in 2008 and 2009, consumption contracted significantly in the developed regions, particularly in 2009. MEK consumption may increase modestly during 2011–2014 in the developed regions as it tries to regain some lost volume.

(For the complete marketing research report on METHYL ETHYL KETONE [MEK], visit this report’s home page or see p. 675.5000 A of the Chemical Economics Handbook.)

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CEH Marketing Research Report Abstract
PHOSPHATE ROCK
By Bala Suresh

The world phosphate rock industry, following a relatively buoyant period that ended in the late 1980s, experienced a sharp decline as a result of the socio-economic-political problems experienced in the Eastern bloc counties. The world’s operating rate dropped from 83% in 1990 to a low of 68% in 1993. The industry has exhibited only a marginal upward trend since. World production and consumption experienced another cyclical low in 2001. Since then, production had increased with demand for phosphate fertilizers until the ongoing global economic crisis. In late 2008, global demand for phosphate fertilizers fell drastically, resulting in minimal trade and reduced production. An average annual growth rate of around 3.5% is projected for consumption during 2008–2013. The phosphate rock market, which has been somewhat tight recently, is expected to loosen after capacity addition projects come to fruition during the next five years, coupled with reduced demand.

China is the largest phosphate rock producer, accounting for 34% of world production in 2008. In October 2008, the Chinese government enacted stricter controls for exports of phosphate rock based on the need for self sufficiency with respect to domestic consumption for fertilizer production to be used in food cultivation. The United States, Africa, the former USSR, and the Middle East are also large producers. World phosphate rock production increased by nearly 50% between 1993 and 2008. Large increases occurred in Socialist Asia, Africa, and the Middle East. Large declines have occurred in the United States, the former USSR, and Mexico since 1993.

The following pie chart shows world consumption of phosphate rock:

The primary market for phosphate rock is the production of phosphate fertilizer products such as ammonium phosphates and superphosphates. It is estimated that fertilizer production accounts for more than 90% of world phosphate rock consumption. The balance is consumed as animal feed and in a variety of industrial/technical applications. Apparent world consumption of P2O5, which by definition is equal to world production, peaked in 1988 and had dropped 30% by 1993. Although recovery occurred between 1993 and 1998, a cyclical downturn occurred once again in 2001, led by significant drops in consumption in the United States, Socialist Asia and Western Europe. However, in keeping up with population growth and the rate of growth for developing economies, the past five years have seen robust growth and that trend is expected to continue into the future.

However, the fertilizer segment’s demand for minerals has been dropping since the advent of the ongoing economic downturn and has continued on a sluggish path in 2009. Major producers have cut down their production to either boost prices or even to stabilize the market. Mosaic cut its production by about one million metric tons in 2008 and is slated to cut another one million metric tons in 2009. However, new projects have been planned outside the United States, mostly in Africa and South America.

As and when the fertilizer market improves, the phosphate rock supply is expected to exhibit tightness in the medium term, with limited capacity additions coming on stream. After the Vale project in Peru for rock production and Ma’aden project in Saudi Arabia for diammonium phosphate start operations and ramp up to expected production levels, the situation is expected to ease. It is expected that if all announced projects come through, global capacity will be increased by as much as 25–30% in the next five years.

(For the complete marketing research report on PHOSPHATE ROCK, visit this report’s home page or see p. 760.3000 A of the Chemical Economics Handbook.)

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CEH Marketing Research Report Abstract
STYRENE
By Sean Davis

Plant expansions in Asia and the Middle East and softening demand in developed regions have led to styrene oversupply in the United States, Western Europe and Japan. These changes have resulted in industry rationalization in styrene monomer and derivative capacity. During the next five years, major capacity additions for styrene will occur, mostly in China, the Middle East, and Central and South America.

The major markets for styrene are polystyrene, acrylonitrile-butadiene-styrene (ABS)/styrene-acrylonitrile (SAN) resins, styrene-butadiene (S/B) copolymer latexes, unsaturated polyester resins and SBR elastomers and latexes. Styrene demand remains dominated by its main derivative, polystyrene (59%), which has reached maturity in most developed countries. Other styrene consumption was for the production of ABS/SAN (16%), S/B copolymer latexes (6%) and unsaturated polyester, accounting for an additional 6% of world styrene demand, while SBR and SBR latexes production accounted for 4% of world demand.

The following pie chart shows world consumption of styrene:

World styrene demand grew at an average annual rate of only 0.4% during 2003–2008. Rising raw material prices and weakened demand for polystyrene in the United States, Western Europe and Japan slowed overall styrene demand growth. Growth in these three regions will be flat to declining over the forecast period.

The fastest styrene demand growth will be in China, the Middle East, Central and Eastern Europe, and Central and South America. Based on current capacity expansion announcements, the United States, Canada, Japan, Singapore, the Republic of Korea, and the Middle East will remain net exporters while Mexico, India, Thailand and other Asian countries will continue to be net importers to 2013. Capacity closures in the United States and Western Europe in 2009, and potentially into 2010, and continued capacity growth in China will gradually shift global supply closer to demand in Asia.

(For the complete marketing research report on STYRENE, visit this report’s home page or see p. 694.3000 A of the Chemical Economics Handbook.)

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PEP Report Abstract
ADVANCES IN AMMONIA TECHNOLOGY
By Victor Wan

Although fundamental ammonia-manufacturing technologies have not radically changed in the last ten to fifteen years, numerous technological changes and improvements have taken place in processing technologies, aiming for increased energy efficiencies and, of late, for higher capital productivity and improved competitive profit margins from lower operating costs. Most of the above advantages are being achieved through development and implementation of better process conditions and more efficient equipment design.

In the last decade, several improved and more efficient ammonia technologies have been commercialized worldwide by major licensors including Haldor Topsoe, KBR, Uhde and Ammonia Casale.

This PEP report provides an overview of ammonia technology developments in catalyst, process and hardware technologies since PEP Report 44A, Ammonia, was issued in 1980. The report then develops process economics for production from the most common type of ammonia feedstock, natural gas. The report will also highlight the major hallmarks of the technologies, along with the current commercial picture for the ammonia industry.

Detailed technology descriptions and cost analyses of two current-day ammonia technologies, the Uhde Dual Pressure process and the KBR PURIFIERplus process, are presented.
 

(For the complete November 2009 Report 44B on ADVANCES IN AMMONIA TECHNOLOGY, visit this report’s home page.)

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PEP Review Abstract
C3-C4 OLIGOMERIZATION FOR GASOLINE
By Richard H. Nielsen

Oligomerization is a process that converts light olefins, usually propylene, butylene or their mixtures, contained in mixtures with light paraffins from catalytic or steam cracking, visbreakers, cokers or Fischer-Tropsch units into gasoline or, obtained with hydrogenation, even jet fuel blendstocks. Paraffinic LPG is a by-product. These olefinic LPG streams are too volatile for direct blending into gasoline.

In the net reaction, one olefin reacts with one or more of the same or different olefins to form a heavier olefinic compound. The product may be hydrogenated downstream to meet specifications of the motor fuel. Two types of processes are commercial: solid acid catalyzed or homogeneously catalyzed.

Oligomerizing light olefins can increase refinery profit by providing an outlet for these light olefins at relatively low capital expenditure usually through increased gasoline sales. The process is especially attractive in situations where olefin alkylation or separation into petrochemical-grade olefins is not attractive because of the unavailability of isobutane, smaller refinery capacity or local market conditions.

We review the chemistry and technology of light olefin oligomerization with emphasis on producing gasoline blendstock. We determine the economics of two cases: oligomerizing an FCC mixed C3-C4 stream with solid phosphoric acid catalyst and dimerizing an FCC mixed C3 stream with a homogeneous catalyst. Each grassroots plant’s capacity is 3,333 BPSD (530 m3/SD) of fresh feed. Each plant is operating in a fuels refinery on the U.S. Gulf Coast.

(For the complete December 2009 Review 2009-14 on C3-C4 OLIGOMERIZATION FOR GASOLINE, visit this report’s home page.)

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PEP Review Abstract
CYCLIC OLEFIN COPOLYMERS (COC)
By R. J. Chang

Cyclic olefin copolymer (COC) exhibits superior optical properties with high-temperature resistance and moisture barrier characteristics. Demand has been growing rapidly in optical films for liquid crystal displays, lenses and high-end pharmaceutical packaging. Global capacity expanded from 7 thousand to 72 thousand metric tons from 1998 to 2009.

This review provides an industry update and summarizes new patents since PEP published its first report on COC in 1998. Among all disclosed technologies, a new Zeon technology based on a novel organoruthenium ROMP (Ring Opening Metathesis Polymerization) catalyst is selected for process economics study. The novel catalyst has high conversion in the ROMP reaction and does not poison Pd/C hydrogenation catalyst. The subsequent hydrogenation process can be carried out in the reaction mixture without separation or removal of the ROMP catalyst. The new Zeon technology is chosen for this review since it represents a major advancement of the ROMP-Hydrogenation process for producing COC. The new technology is expected to offer significant advantage in cycle time and capital costs. A conceptual design based on Zeon’s new organoruthenium catalyst technology is presented, and the associated production costs and capital investments are assessed.

(For the complete November 2009 Review 2009-7 on CYCLIC OLEFIN COPOLYMERS [COC], visit this report’s home page .)

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SCUP Report Abstract
PLASTICS ADDITIVES
By Stefan Müller with Yang-Wei, Syed Q. A. Rizvi and Kazuteru Yokose

Eight functional classes of specialty plastics additives are described in this report—antioxidants, antistatic agents, chemical blowing agents, flame retardants, heat stabilizers, impact modifiers, lubricants and light stabilizers (commodities such as plasticizers and fillers are excluded, as are polymerization catalysts and colorants). Summary data are provided for all world regions, and detailed market and producer data are provided for North America, Europe, Japan and China.

Each functional class in turn includes several product types. These products are produced by a wide spectrum of chemical companies, only a few of which produce more than two functional classes. Although there are many participants, two to four companies tend to dominate each functional type within each major world region. Additive customers include resin manufacturers, specialty compounders and plastics fabricators. The volumes of individual additive products are often quite small, and significant volumes of some of these additives are exported to customers throughout the world. Indeed, there is a growing recognition of plastics additives as a worldwide business, especially as companies broaden their participation by adding more functional types to their product lines. Another reason for a worldwide perspective is that many of the customers (i.e., the large resin producers) also operate worldwide.

While volume growth in the mature economies from 2005 to 2008 was small, prices (in U.S. dollars) gained significantly and consequently the total market value grew as well. Higher raw material prices, net margin increases, supply shortages for raw materials and an unfavorable exchange rate (from the USD import perspective) contributed to the strong growth of the market value.

The following pie chart shows world consumption of plastics additives:


The future growth of plastics additives as a class is tied largely to the growth of the resin industry and the end-use consumer segments it serves (e.g., packaging, automotive and construction). In turn, the growth of these consumer segments is tied strongly to overall economic growth, which this report assumes will resume at a modest pace following the downturn that characterized the early years of the new century. Overall volume growth for plastics additives in the major consuming areas is expected to average 0.8% per year over 2008–2013, and will be fastest (6.0–6.7%) in China and India. A slightly negative growth (–0.4%) is expected in Japan. The North American and Western European growth forecasts assume an average GDP growth rate of about 0–1% during 2008–2013 as a consequence of the economic crisis of 2008/2009. Growth in resins using these additives will follow GDP. The negative growth forecast for Japan and small growth rates for the Republic of Korea and Taiwan will likely result from a continuing shift of the production of plastics and finished goods from these countries to China, where labor and some raw material costs are much lower. Japanese additive producers hope they can continue to supply some of these customers via exports, but will face much stronger competition from highly cost-competitive producers in nearby Asia.

These developments in the East Asian market will continue to create export opportunities for U.S. and Western European suppliers of specialties. They will also present opportunities for producers in all three regions to form joint ventures with companies or government agencies in East Asian countries, especially China, to produce the required additives in that region. Increasingly, commodities from China and the Republic of Korea will be exported to all other regions of the world.

In South America, Brazil is the largest consumer of plastics and plastic products; hence it is a large user of additives. Brazil accounts for almost 50% of the 2008 South American plastics additive consumption, which in actual volume is significantly higher than that of Mexico. While U.S. and Canadian consumption is projected to increase at a slow rate, that of the South American countries is expected to be somewhat higher. In addition, over the next five years a production shift of about 10% to Mexico and South American countries is expected, because of the efforts of plastic producers and processers to offset the high costs of materials, energy, and fuel; slumping domestic car and home sales; threats of higher interest rates; and severe weather disruptions. The consequence of such a shift will be competition from Latin American manufacturers that have lower labor costs, taxes, and regulatory expenses.

(For the complete December 2009 report on PLASTICS ADDITIVES, visit this report’s home page or see vol. 12 of Specialty Chemicals—Strategies for Success.)

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SCUP Report Abstract
RUBBER-PROCESSING CHEMICALS
By Fred Hajduk, Hossein Janshekar, Akihiro Kishi and Xiaomeng Ma

Most rubber-processing chemicals are older products and are consumed predominantly in the manufacture of automotive tires. Because of increasing consolidation in the tire industry, the major tire manufacturers are in a strong position to demand low prices for rubber-processing chemicals while still maintaining the demand for high quality, product improvements, efficient delivery and strong technical support. Environmental issues are an ongoing concern that could force producers of rubber-processing chemicals to upgrade manufacturing facilities and develop less hazardous products.

These factors have led to an extended period of low profits in the rubber-processing chemicals industry. The industry response has been global consolidation, to achieve more efficient economies of scale in both manufacturing and business operations. The major international competitors are Chemtura, Flexsys and LANXESS, which are gaining share over smaller, regional producers.

The following pie chart shows world consumption of rubber-processing chemicals:


As this report was being written, the North American economies were experiencing what observers claim to be the worst economic downturn since the Great Depression of the 1930s. While opinions vary widely as to the timing of the economic recovery, many commentators opine that most industries have experienced a structure shift. While these discussions are beyond the scope of this report, in developing our forecasts, we have chosen an economic scenario in which the North American industries exhibit a period of stagnation, followed by a gradual expansion to previously historical growth rates. While conservative, the resulting product consumption forecasts do not represent the “worst case scenario,” but are believed to provide a realistic base for planning purposes. The profitability of the industry as a whole has been in doubt for several years, and the cost of meeting environmental requirements has had a major impact. In the area of government regulations, specific chemicals used as accelerators and shortstops are undergoing changes because of the formation of carcinogenic stable nitrosamines from some of these chemicals.

European rubber manufacturers have been facing increasing competition with products from emerging markets such as China, which has incited the sector to focus its production on high-tech and sophisticated products. The backward integration displayed (i.e., by some tire manufacturers) has put significant pressure on suppliers of rubber chemicals. Several synthetic rubber producers manufacture some of their own chemicals.

In Western Europe, the rubber-processing chemicals industry is mature, with mature products and well-established suppliers and customers, and exhibits a declining trend as the result of a reduction in both production and consumption of rubber in this region. Demand on a volume basis during 2008–2013 is expected to continue to decline, at an average annual rate of –1.0%. A slightly slower rate of decline is expected for antidegradants than for accelerators. There is little new product introduction. Among accelerators, use of primary amine–based sulfenamides, such as N-cyclohexyl-2-benzothiazole sulfenamide, and thiazoles, such as 2-mercaptobenzothiazole, has been promoted because these products are not considered to be a primary source of stable N-nitrosamines, a potential health hazard. There is an ongoing effort to understand and decrease the causes of allergic reactions to rubber. Among rubber-processing chemicals, accelerators have been connected most with such allergic reactions.

Since the early 1990s, the major accelerators used in the Japanese tire industry have been N-cyclohexyl-benzothiazole sulfenamide (CBS), N-t-butyl-2-benzothiazyl sulfenamide (TBBS), and benzothiazyl-2-cyclohexyl sulfenamide (DCBS). The largest-volume antidegradant used in tires is 6PPD, followed by dihydroquinolines, mainly TMQ. Japanese consumption of rubber-processing chemicals during 2005–2008 grew at an average annual rate of 1.7%. The Japanese market for rubber-processing chemicals was good until late 2008; the economy slowed in 2009 (probably a 20% drop), but is expected to recover gradually to 2013. The average annual growth rate between 2008 and 2013 is expected to be negative (–1%), but there will be ups and downs in the market.

China became a net exporter of rubber-processing chemicals in 2005. Production (especially of accelerators) exceeding domestic demand is one of the primary factors that stimulated exports. In 2008, exports of rubber-processing chemicals declined as a result of the global economic downturn.

(For the complete December 2009 report on RUBBER-PROCESSING CHEMICALS, visit this report’s home page or see vol. 14 of Specialty Chemicals—Strategies for Success.)

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SCUP Report Abstract
SYNTHETIC LUBRICANTS
By Stefan Müller with Masahiro Yoneyama, Yang-Wei and Syed Q. A. Rizvi

Synthetic lubricants (synlubes) are defined as lubricant products that consist of fluids made by chemical conversion of low-molecular-weight components plus additives. Products derived by hydrogenation/cracking after distillation of crude oil are not within the scope of this report. Mineral oil–derived products are marketed as “synthetic” by the industry.

Synthetic base stocks (fluids) are produced by processes that are controlled in order to restrict the finished base fluid to one or a defined range of compounds. This permits the selection of those chemical compounds that have the best properties and provide superior lubricant performance compared with conventional mineral oil–based lubricants under specific operating conditions. These superior properties may include good thermal and oxidative stability, low-temperature fluidity, low volatility, high viscosity indexes and fire resistance. There are about ten significant synlube product types or classes, most of which contain many individual products or individual molecular structures. Each of these product classes has unique properties that make it particularly well-suited for certain specific applications, but not for others. Thus, each class rarely competes with more than one or two other classes of synlubes in any specific end use.

Since synlubes are generally far more expensive than conventional mineral oils, their use has traditionally been restricted to those applications that demand the very high performance characteristics that only the synlubes can provide. Increasingly, however, industrial customers in some segments are taking a broader and longer view of their total costs and are opting to use synlubes to reduce maintenance, minimize disposal problems, or satisfy health, safety or environmental regulations. Since the 1990s, a major driving force for the strong growth of synlubes in the automotive sector has been the promotional campaigns of lubricant manufacturers for their synthetic automotive crankcase and gear oils and the new requirements of automotive manufacturers, especially in Western Europe. The ongoing demand for higher fuel economy has also pushed the use of high-quality motor and gear oils. Another important development was the growing use of synlubes as refrigerator oils to provide compatibility with the new refrigerants that have replaced chlorofluorocarbons (CFCs). The latter development has continued into the new century, and greatly increased the use of synlubes in this application.

The market for synthetic lubricants is dominated by three product groups: polyalphaolefins, esters and polyalkylene glycols. Their combined market share in 2008 was 90%. The major market drivers during 2005–2008 were the growing demand for industrial lubricants in China and India as well as the growing automotive fleets in China, Russia and Brazil.

The following pie chart shows world consumption of synthetic lubricants:


The synlube business includes large volumes of polyalkylene glycols and low-viscosity polyalphaolefins that are sold largely as commodities, but also many small-volume, high-priced specialty chemical products. Nearly all synlubes enjoy growth rates that are faster than mineral oils, and many are growing faster than other specialty chemical product types. Although many segments of this business appear attractive (good growth and limited competition), entry into this market would not be easy, except through acquisition, which often means acquiring other related businesses linked to synlubes only by the family of products the acquired company produces.

While the total share of synthetic lubricants in the global lubricant business is only around 2.6%, their importance is growing as more and more applications demand a performance that is borderline or beyond the capabilities of conventional lubricants. This is reflected by the fact that synlubes represent about 10% of the total value of the global lube oil market. The world market is projected to grow at an average annual rate of 2.0% per year on a volume basis to 2013. Growth in synlubes is expected to continue at a low rate in North America and Europe. In contrast, no growth or even decline is expected in Japan and Western Europe. High growth rates are expected in China, Brazil and India.

(For the complete December 2009 report on SYNTHETIC LUBRICANTS, visit this report’s home page or see vol. 10 of Specialty Chemicals—Strategies for Success.)

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The inaugural issue on September 15, 2009 covered the following key areas:

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See for yourself ChemicalWeek Regulatory Watch’s comprehensive coverage of the regulatory developments arising out of the chemical industry business and activities. When you sign up for your free trial subscription, every other Tuesday you’ll receive the ChemicalWeek’s Regulatory Watch email that takes you right to the online, in-depth, up-to-date developments in this unparalleled resource.

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CEH Reports and Product
Reviews in Preparation

Report Title

Author

Acetic Acid

Mike Malveda

Acetic Anhydride

Mike Malveda

Acrylic and Modacrylic Fibers

Barbara Sesto
Acrylic Surface Coatings Eric Linak
Activated Carbon Elvira Greiner
Alkyl Acetates Thomas Kälin
Ammonium Phosphates Don Lauriente
Benzene Sean Davis
Biodegradable Polymers Mike Malveda
Carbon Fibers Sebastian Bizzari
Chlorobenzenes Sean Davis
Ethyleneamines Milen Blagoev
Fluoroelastomers Uwe Löchner
Formaldehyde Sebastian Bizzari
Hydrogen Cyanide Bala Suresh
Inorganic Zinc Chemicals Stefan Schlag
Ketene/Diketene Mike Malveda
Linear Alkylate Sulfonates Bob Modler
Miscellaneous Sulfur Chemicals Stefan Schlag
Mono-, Di- and Triethylene Glycols Henry Chinn
Phthalic Anhydride Sebastian Bizzari
Polybutadiene Elastomers Emanuel Ormonde
Polypropylene Resins Andrea Borruso
Polyurethane Elastomers Henry Chinn
Silicones Ray Will
Sodium Cyanide

Bala Suresh

Styrenic Copolymers Uwe Löchner
Toluene Sean Davis
Vinyl Surface Coatings Eric Linak
Wet-Process Phosphoric Acid Stefan Schlag
   


This list is provided for the benefit of Chemical Economics Handbook users who may simultaneously be undertaking their own studies in these areas. Clients are welcome to write or call us in order to discuss the work in progress.

CEH Reports Available Separately 

To obtain a list of CEH marketing research reports or product reviews for sale separately, please see our website at http://chemical.ihs.com/CEH/Public/Reports/ or contact:

                Koon-Ling Ring, Director
                Chemical Economics Handbook Program
                SRI Consulting
                4300 Bohannon Drive, Suite 200
                Menlo Park, CA 94025
                Tel. (650) 384-4300  Fax: (650) 330-1149

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PEP Reports Published in 2009

Report Title

Author

Status

Gasoline Benzene Removal

Richard Nielsen

Published

Ethylene Glycol

Syed Naqvi

Published

Supercritical CO2: A Green Solvent Susan Bell Published
Dimethyl Ether (DME) from Coal Ron Smith Published
Advances in Ammonia Technology Victor Wan Published

Advanced Carbon Capture

Mike Arné

Published*

Thermochemical Cellulosic Ethanol

Ron Bray

Published*

Higher Alcohols from Syngas

P. D. Pavlechko

Published*

Coal to Gasoline

Ron Smith

Published*

Polysilicon for Solar Wafers

Tony Pavone

Published*

     

*Abstracts for these reports will be published in the January 2010 issue of the Newsletter.

To view a list of PEP reports for sale separately, please see our website at http://chemical.ihs.com/PEP/Public/Reports/By_Name.html. For additional information, please contact:
            R. J. Chang, Director
            Process Economics Program
            SRI Consulting
            4300 Bohannon Drive, Suite 200
            Menlo Park, CA 94025
            Tel. (650) 384-4300   Fax: (650) 330-1149

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SCUP Reports Published in 2009

Report Title

Author

Status

Mining Chemicals

Patricia Thiers

Published

Specialty Chemicals Overview

Uwe Fink

Published

Antioxidants

Fred Hajduk

Published

Specialty Paper Chemicals Ray Will Published
Imaging Chemicals: Inkjet Technologies Uwe Fink Published
Corrosion Inhibitors Stefan Müller Published
Printing Inks Ray Will Published
Rubber-Processing Chemicals Fred Hajduk Published
Plastics Additives Stefan Müller Published
Synthetic Lubricants Stefan Müller Published
Specialty Films Fred Hajduk Published*
Adhesives and Sealants Ray Will Published*
     

 

 

 

*Abstracts for these reports will be published in the January 2010 issue of the Newsletter.

To view a list of SCUP reports for sale separately, please see our website at http://chemical.ihs.com/SCUP/Public/Reports/. For additional information, please contact:
             Ralf Gubler, Acting Director
             Specialty Chemicals Update Program
             SRI Consulting
             4300 Bohannon Drive, Suite 200
             Menlo Park, CA 94025
             Tel. (650) 384-4300   Fax: (650) 330-1149

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CHEMICAL INDUSTRIES NEWSLETTER

The Chemical Industries Newsletter is published monthly by SRI Consulting. The contents of the Newsletter are drawn from current research and publications of SRIC's multiclient programs. Readers are welcome to call or write for more information about the subjects and programs mentioned (see addresses and telephone/fax numbers below).

SRI Consulting offers the world's most comprehensive ongoing multiclient databases on the chemical industry. The major multiclient programs include:
 

Chemical Economics Handbook Directory of Chemical Producers
The China Report Canada Mexico
Process Economics Program China Middle East
Specialty Chemicals Update Program East Asia South/Central America
World Petrochemicals Europe United States
India  

Companies may participate in these continuing programs for the chemical industry through annual subscriptions or by purchasing individual reports. Each program is supported by inquiry and consulting privileges; electronic access is also available for all of these products.

SRI Consulting ..................................................................... ......John Pearson, President and CEO
George Intille, Senior Vice President

Ralf Gubler, Vice President
Russell Heinen, Vice President
Linda Henderson, Vice President
Steven Landau, Director—Operations

Chemical Economics Handbook ......................................
Directory of Chemical Producers .....................................
Process Economics Program .............................................
Production/Databases .......................................................
Specialty Chemicals Update Program ............................
World Petrochemicals ........................................................

......................Koon-Ling Ring, Director
..........................Carolyn Read, Director
...............................R.J. Chang, Director
........................Steven F. Read, Director
.................Ralf Gubler, Acting Director
..............................Ed Gartner, Director

About SRI Consulting

SRI Consulting provides the world's most comprehensive ongoing databases on the chemical industries. We offer an array of research-based programs designed to provide clients with specific market intelligence and analysis. These programs, combined with strategic information services, help clients define new market opportunities, identify and communicate future challenges, formulate and implement business strategies, and develop innovative products, processes and services. SRIC provides creative yet practical strategies, supported by renowned industry and technology expertise and delivered by multidisciplinary teams working closely with clients to ensure implementation. SRI Consulting is a division of Access Intelligence, LLC.

About Access Intelligence, LLC

Access Intelligence, LLC is a full-service global information and marketing solutions provider of competitive business-to-business information. The company publishes daily news services, premium-value newsletters, subscription-based websites, magazines, directories, and databases.

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See our website at chemical.ihs.com
Chemical Industries Newsletter
Ellen Blue, Editor

© 2009 by SRI Consulting.
All rights reserved. Unauthorized reproduction prohibited.


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