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Polybutenes
In
addition, two companies produce highly reactive polyisobutylene (HR-PIB).
Chevron Oronite Company at Belle Chasse, La. has 130 million pounds of capacity,
and Texas Petrochemical Company has 65 million pounds of
capacity in Houston, Tex. Both of these HR-PIB units came on-line in 2000. In
2001 BP consolidated its North American polybutene production at its Whiting,
Ind. refinery, while ceasing polybutene production at its Texas City, Tex.
refinery. About 255 million pounds of annual capacity were eliminated by the
move. Infineum
U.S.A. LP is a joint venture formed for lubricant oil additives by Exxon
Chemical Company, Shell Petroleum Company Ltd. and Shell Chemical Company in
1999. The production facilities in Baytown, Tex. and Linden, N.J. were
previously part of the Exxon operations. Infineum’s production is captive. DEMAND 2002:
725 million pounds; 2003: 740 million pounds; 2007: 755 million pounds,
projected. Demand equals production plus imports (2002: 24 million pounds; 2003:
52 million pounds) less exports (2002: 46 million pounds; 2003: 47 million
pounds). GROWTH Historical
(1998 - 2003): 0.5 percent per year; future: 0.5 percent per year through 2007. PRICE Historical
(1998 - 2003): High, 43˘ per pound, 950-1300 mol. wt., tanks, f.o.b.; low, 38.5˘,
same basis. Current: 47.5˘, same basis. USES Fuel
and lube oil additives (production of corrosion inhibitors and dispersants), 60
percent; adhesives, adhesives and sealants, 25 percent; miscellaneous, including
lubricant viscosity control, leather impregnation, resin plasticizers, and
dielectric fluids for electrical applications, 15 percent. STRENGTH Polybutene
consumption is most influenced by the market for lube oil additives, which in
turn, is a function of lubricant sales. Lubricant sales in the US are growing at
1 to 2 percent per year. Polyisobutene succinimides dominates the dispersant
market in lubricants with an 80 percent share. An additional 15 percent share is
held by polyisobutene succinates. These market shares have not changed
significantly in the last few years. Higher-molecular-weight
polybutenes are used as modifiers in various adhesives, especially hot-melt and
pressure-sensitive products. These applications have modest growth prospects. WEAKNESS Polybutene
consumption in lube oil additives is also a function of additive levels.
Dispersant levels have dropped 10 to 15 after 1996 following the adoption of new
quality specifications. Highly
reactive polyisobutylene (HR-PIB) competes with conventional polybutenes in the
fuel additives market. In this sector it is growing at 1 to 2 percent per year,
while conventional polybutenes are flat to declining. Manufacture of HR-PIB uses
high-purity isobutylene as its feedstock. HR-PIB commands a 25 to 30 percent
premium over conventional polybutenes, but its superior performance in most
applications can compensate for the price differential. OUTLOOK Rationalization
of capacity by BP in 2001 tightened the polybutene supply side, causing an
attendant drop in exports and an increase in imports the following year.
In 2003, imports grew again while exports remained relatively flat. The
market appears to be in balance and should remain so as demand growth is
comparatively soft, projected at 0.5 percent for the forecast period. Two price
increases of 4.5˘ each in 2003, allowed producers to recover margins eroded by
hydrocarbon costs that had been dramatically increasing since 2001. With the
strong economy, produces may look again for another price increase in 2004. HISTORICAL DATA
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