Ineos, the world's largest producer of phenol and acetone, reduced output at its Gladbeck facility, in western Germany, as freezing temperatures across Europe have been causing problems with the supply of feedstock cumene, a company executive said Friday.
Frozen rivers and blocked roads and railways have been forcing Ineos to adjust its operating rates on a daily basis depending on the availability of cumene, said the source, who couldn't be named as he isn't authorized to speak publicly for the company.
"We were forced to reduce rates by as much as 70%. But that changes everyday. Despite that, we haven't had any problems to meet our commitments," he added.
Gladbeck has the capacity to produce around 650,000 mt/year of phenol and 395,000 mt/year of acetone.
To compensate for the shortfall, Ineos has been shipping product from its Antwerp plant, in Belgium, the source said. "We are bringing material through the Rhine river, which is still open, to our storage facilities in Duisburg," he added.
The cutback in production rates comes at a time when acetone and phenol availability in Europe has began to dry up. Strong demand from restocking combined with pre-buying ahead of feedstock increases in February have contributed to tighten supply, sources said.
In addition, upcoming turnarounds at Cepsa's Huelva, in Spain and Ineo's Gladbeck, in Germany have also reduced the amount of product major producers can offer to the spot market, sources said.
Acetone and phenol were last assessed by Platts at Eur825/mt FD NWE and Eur1,300/mt FD NWE on Tuesday, respectively.
"The market is already higher. We are not selling acetone below Eur900/mt FD NWE," the Ineos source said.
