SABIC stops CX production at Wilton, to withdraw from global market

LONDON (ICIS)–SABIC has stopped production at its Wilton, UK, cyclohexane (CX) facility, and will exit the global market after working down inventory, a company source confirmed on Wednesday.

Production stopped at the producer’s facility two weeks ago, with material being supplied from stocks at this time, according to the source.

There was no comment from the company on how long it will be able to supply from stock, but sources in the market expect this to continue into February. 

At this stage the producer will leave the global CX market.

The facility at Wilton has a nameplate capacity of 330,000 tonnes/year, according to ICIS data, but was thought to have been running at approximately 195,000 tonnes/year before the closure, according to market sources.

The closure came as no surprise to the industry, following SABIC’s announcement of plans to modify its 865,000 tonne/year Wilton ethylene plant to crack ethane from the US, alongside other feedstocks.

Supply at the start of the year started at a tighter level, following a production problem that was understood to have occurred for ExxonMobil at its Botlek, Netherlands, facility, and a decrease in imports in December.

There was no confirmation from ExxonMobil on the production problem, which was said by sources to have been resolved at the start of the year, with the producer then building up stock.

The European CX market has been left more reliant on imports. The drop in import volumes in December, combined with the closure of SABIC’s Wilton facility, has reduced the length in the European market.

Buyers building stocks at the start of 2017, after the traditional end of year destocking phase, added additional strain to the supply balance.

At this stage, it is unclear if other European producers have increased utilisation rates, but there are expectations that that this will occur in the wake of the SABIC closure.

Given the recent bullish benzene prices, combined with tightened supply, it has been a firm start to the year for the European CX market.