Japan's Showa Denko Likely to Keep AA Plant Idle until End 2009

Tokyo (Platts)--21Jan2009

Japan's Showa Denko will likely keep production of Acetic Acid (AA) at its Oita complex shut until the end of the year as it is more economical to buy AA than to produce it, a source close to the company said Thursday. 

Production at the 130,000 mt/year AA plant has been shut since early January, and the company was importing AA from Malaysia's BP Petronas Acetyls instead, the source said. 

The source said the company was, however, not planning to scrap the plant, keeping the possibility of restarting it again in the future open. 

The company needs around 120,000 mt/year AA to feed its 175,000 mt/year vinyl acetate monomer plant at the complex, according to industry estimates. 

The company had been selling surplus acetic acid to purified terephthalic acid producers in Japan, but it has canceled all contracts for 2009, the source said, indicating the AA plant would not be restarted this year.

Source: www.platts.com