1 min read
Outages and Raw Materials Shortages Keep Isocyanates Under Pressure
Regina Sousa : Aug 2, 2021 12:00:00 AM
The North American MDI market continues to be disrupted due to raw material shortages and prices are still firming. Lack of supply availability, even though most plants are reported to be online, and issues sourcing raw materials, plus high freight costs and truck shortages, are adding upward pressure on MDI prices. Demand in July has been strong, housing starts and construction continue to perform well, and is in line with expectations for the season. Offtake volumes from furniture and bedding has also been healthy and this is likely to continue in the short term.
European MDI supply remains more or less unchanged from June; production continues to be disrupted and availability is low. Covestro was reportedly running its European units at reduced rates in order to complete maintenance. But, on 2 July the operator declared force majeure at the 200 ktpa MDI Brunsbuttel, Germany plant. The length of the force majeure is unknown. Borsodchem was due to start planned maintenance at its MDI unit in Kazincbarcika, Hungary. The unit usually shuts in mid-July and coincides with a turnaround at its TDI plant at the same site. In terms of demand, some market players say that demand is still strong, particularly from the construction sector. August is usually seasonally quiet and demand could slow down as most of Europe takes time off for the summer holiday. However, demand is still very high, supply low and this, combined with the current backlog of orders, could mean the market will see less of a slow down.