Phenol and Acetone supply in Asia low amid Force Majeure by Major Producer

Taiwan Prosperity Chemical Corp (TPCC) which is a major producer of Phenol and Acetone in Asia has declared Force Majeure on the supplies of Phenol and Acetone from the company’s plant located in Kaohsiung, Taiwan. 

The plant at Kaohsiung has a production capacity of 360,000 tonnes per year of Phenol and 221,000 tonnes per year of Acetone. 

This has led to a supply crunch in the Asian markets for Phenol and Acetone. The prices of Acetone rose consistently in August with the prices at USD 780 per tonne on Aug 1st, USD 860 per tonne on Aug 15th and around USD 895 per tonne last week.

TPCC was acquired by Chang Chun plastics in March 2021 for USD 85 million from Taiwan Cement Group which doesn’t hold any share in TPCC anymore. 

Acetone is a flammable, colourless, and volatile liquid which is commonly used as an industrial solvent. It is produced as a by product during Phenol manufacturing. Cumene process is the most widely used method for producing both Phenol and Acetone. Acetone undergoes further modification with the help of oxidation to manufacture Bisphenol A, Methyl Methacrylate, and other solvents. 

Phenol is an aromatic compound which has higher acidity levels. It is a volatile white crystalline solid and is used to manufacture a variety of chemicals. Its major applications are Epoxy Resins, Polycarbonates, Nylon, Bakelite, Phenolic Resins etc. 

As per ChemAnalyst, “the supply crunch in the Asian markets is expected to continue until some domestic producers increase their production capacities. The forecast for Acetone prices is between USD 895-900 per tonne in the upcoming last week of August.”