Celanese sees stable acetyls market due to construction, paints and coatings: CEO

The global acetyls market remains stable amid weak, mostly downstream demand, according to Celanese President and CEO Lori Ryerkerk.

"It is stable for construction, paints and coatings, specifically that sector at a very low rate," Ryerkerk said during the company's second-quarter earnings call. Celanese's cellulose acetate tow business is also stable, she added.

Celanese faced price pressures on raw and nylon polymer in the second quarter and shut its Uentrop, Germany, facility to avoid negative margins, Ryerkerk said.

"We could be buying raw polymer on the market in what was a very low-priced situation, certainly lower than we would have been able to make it ourselves," she said.

Celanese's Clear Lake, Texas, facility remained under force majeure, with expectations that it will be lifted in the third quarter, Ryerkerkhad said. The total expected cost from the outage was estimated at $35 million in Q2, with another $5 million-$10 million in losses expected in Q3. The company said the Clear Lake outage was caused by supply issues with several different raw materials and carbon monoxide.

Chief Operating Officer Scott Richardson, also in the call, cited growth opportunities for the development of the nylon market in Asia.

"While the competitiveness in the standard grades is definitely there, there's still really good opportunities kind of in that that spec-in and specialty area," Richardson said.

Celanese is increasingly focusing more on Asia, where it has "seen more opportunities in our emulsions as well as our redispersible powders business," said Richardson, but added that it does fluctuate weekly and by region.

The startup of a new vinyl acetate ethylene unit in Nanjing, China, as part of the extension of Celanese's CO Phase II contract with Nanjing Chengzhi Clean Energy Co., announced in April, was cited as a way to develop the Asian market.

"Asia is more balanced than where we're selling in the Western Hemisphere," Richardson said.

The new assets were expected to feed the downstream caprolactam, polyvinyl alcohol and ethylene vinyl acetatemarkets. But weak demand in China for both construction and EVA made market conditions more economical "to ship it and put it in other parts of Asia than necessarily to get it to China," said Ryerkerk, adding that the utilization for EVA plants has gone to 70% or below due softness in solar panels manufacture.

Platts, part of S&P Global Commodity Insights, last assessed US spot export medium EVA grade at $1,250/mt FAS Houston on Aug. 5, stable on the day. High EVA grade CFR China was assessed at $1,050/mt and medium EVA grade CFR China at $1,150/mt, both assessments also stable on the day.