Bassett commented that Dow is investing in propane to propylene on the gulf coast which "will be a huge benefit to our customers," and feed into the PO business. The introduction of shale gas, which is used primarily for ethylene derivatives, "has prompted a resurgence in the US chemicals business, taking it back to the cost position of the 1950s, Bassett commented.
Burns pointed out that benzene prices used to be a multiple of crude oil prices. "This is no longer the case, something has changed fundamentally. Also, the US now relies on imports for a quarter of its benzene needs. "I attribute the volatility to the difficulties with imports, and perhaps now the US has started some investment in refining capability, then the US will see a reduction in imports and more stable prices," he concluded.
China MDI approval in 2013?
In China, Huntsman Polyurethanes is still going through the approval process to double its 240 ktpa MDI plant in Caojing, Shanghai. Hankins said it has gained local approvals and is now waiting for central government approval in Beijing, which it hopes to gain early next year.
Hankins said the government has been looking at all aspects including approval for phosgene processes. Chemical sites in China are becoming highly concentrated, he noted: "It is absolutely right that the government is looking deeply at the H&S aspects of plants."
Hankins said the long view is for huge growth of the business still in China and in India, "with short-term fluctuations that simply have to be ridden." He pointed to Huntsman's $40-million new technical centre in Shanghai as evidence of this confidence.
Hankins said he is especially pleased with the way sales are progressing in South East Asia, citing Thailand, Vietnam and Indonesia as regions that are good outlets for MDI. Huntsman has just made a big investment in a systems house in Jakarta, which will open soon, to serve that rapidly expanding market, he pointed out.
Four strong MDI outlets
Hankins feels that the kind of growth Huntsman has been seeing is because of a strong focus on four key areas of MDI use. "Insulation is clearly a high growth area for us. Energy conservation is a global megatrend that will continue for some years ... and MDI is well placed to serve the market here," he stressed.
The second growth area is in binders for composite wood panels, driven in North America by formaldehyde substitution. Huntsman is now seeing very good growth in Europe in this outlet, as well, he added.
A third area is high-end automotive. Hankins observed that, "Most of the automotive market has been quite challenging but the premium end of the business continues to offer strong opportunities," in the US, Europe and especially in China, for companies such as BMW. This is in seating and also for backfoamed dashboards and skins for instrument panels.
The fourth area is in adhesives and coatings, which is particularly strong where governments are investing in infrastructure: MDI does well here, said the Huntsman boss.
In total, Hankins said, MDI and its applications are "a very attractive industry and that makes it a very attractive sector for investment."
Sadara forging ahead
Dow has broken ground for its major Sadara joint venture with Saudi Aramco in Saudi Arabia, where it is adding capacity for MDI, TDI, PO and polyols. "They are pushing forward to try to come out ahead of schedule," Bassett said.
Bassett said start-up is scheduled for late 2015/early 2016, and while Dow has not revealed the scope of the polyurethane assets, they will be world scale, Bassett indicated.
"We continue to look at opportunities in all regions," Bassett said, noting that it has just started up its large PO plant in Thailand.
These project are evidence of Dow's commitment to the business, the executive said.
Bassett commented that Dow has a big initiative to improve reliability of supply for customers.
"This issue plagues the industry in general and isocyanates specifically, and is one thing Dow is really keen to address," he said.
Upstream/downstream split
Huntsman splits its PU business into upstream and downstream value chains, and aims "to make the upstream value chain as high quality, cost-effective and efficient as possible," said Hankins. Its Geismar MDI plant, which Huntsman is considering expanding, epitomises this ideal. "By making a deeper investment there, we think we can take that facility to a whole new level."
Meanwhile Huntsman's downstream strategy in systems is about technology, markets and customers. "That's where we've been investing in acquisitions to access that deep value," Hankins said.
Huntsman now has 17 systems houses worldwide. This year it took full ownership of its Russian systems unit, Huntsman Nizhne-kamskneftechim, and also of the EMA systems unit in Turkey, and built a new Indonesian unit.
Huntsman will continue to search out these kinds of acquisitions "because they give us new routes to market, technological expertise, applications expertise that we can leverage globally," the Huntsman executive continued.
Upstream/downstream split
Huntsman splits its PU business into upstream and downstream value chains, and aims "to make the upstream value chain as high quality, cost-effective and efficient as possible," said Hankins. Its Geismar MDI plant, which Huntsman is considering expanding, epitomises this ideal. "By making a deeper investment there, we think we can take that facility to a whole new level."
Meanwhile Huntsman's downstream strategy in systems is about technology, markets and customers. "That's where we've been investing in acquisitions to access that deep value," Hankins said.
Huntsman now has 17 systems houses worldwide. This year it took full ownership of its Russian systems unit, Huntsman Nizhne-kamskneftechim, and also of the EMA systems unit in Turkey, and built a new Indonesian unit.
Huntsman will continue to search out these kinds of acquisitions "because they give us new routes to market, technological expertise, applications expertise that we can leverage globally," the Huntsman executive continued.
ITWC a good addition for BASF
BASF's systems business has a 100-percent focus on applications and product development, across a lot of industries. Podesta said the ITWC systems business BASF has just acquired makes the group "a stronger player in hot and cold cast elastomers," in the CASE segment. ITWC's systems are a good addition to its range, and the deal also gives BASF polyester polyols.
A little over half of the polyester polyols made are for captive use: "We will have some available to sell to the market," Podesta said.
In the CASE business, BASF is promoting its Filterpave product, for pervious pavement, Podesta said. This is a product with a "wonderful value proposition," which BASF wants to get into the market. "Like a lot of things it takes longer than you think to change the conventional approach," Podesta said.
Also in use is the Elastocoast ballast-binding material for protection against coastal erosion. Again Elastocoast is seeing slow and steady growth, with the technology also being exploited for stabilising ballast on parts of rail lines that have high stress. All the examples of PU as a binder are impressive, Podesta said.