USES

Four butyl acetates exist, but only normal butyl acetate (n-butyl acetate) and iso-butyl acetate are of commercial importance. The major outlet for n-butyl acetate (butac) is as a solvent for lacquers because it gives good flow and brush resistance when used in film-coating resins such as cellulose nitrate, cellulose acetate butyrate, ethyl cellulose, polystyrene (PS) and methyl methacrylate (MMA) resins.

It is also widely used as a solvent in the preparation of artificial leathers, textiles and plastics, as an extractant for oils and pharmaceuticals, and as an ingredient for perfumes and synthetic flavours. Butac and butanol can be used as a dehydrating agent because they form a ternary azeotrope with water.

SUPPLY/DEMAND

European supply of butac was limited for much of 2017 due to a force majeure declared by BASF in October 2016 following an explosion and shutdown of its plant in Ludwigshafen, Germany. In addition, OXEA had an unplanned shutdown and declared force majeure in February, following a technical issue at their plant in Marl, Germany. This further tightened European supply.

Limited imports, tightness in feedstock nbutanol (NBA) and the absence of BASF kept the market tight until July-August, when seasonally weaker demand allowed supply to return to a balanced situation.

BASF also lifted its almost year-long force majeure in August, though production remained at reduced rates. Market conditions returned to stability during the fourth quarter, with balanced supply and demand largely within the expectations of market players. It was confirmed in early December that production of butac at Ludwigshafen had returned to normal rates.

PRICES

In February, butac prices surged to their highest levels since ICIS records of its price in euros began in November 1999, on news of OXEA’s declaration of force majeure and a subsequent tightening of supply.

Feedstock NBA costs also surged to record levels in the first half of the year on tightness largely caused by BASF declaring force majeure on NBA from Ludwigshafen following the explosion in October 2016. BASF is the largest producer of NBA in Europe.

This incentivised producers to sell additional NBA rather than using it to produce butac and supported continued high downstream price levels. Prices steadily decreased throughout the second half of 2017 as availability of butac and NBA eased, but remained significantly above levels seen in 2016 before BASF declared force majeure.

TECHNOLOGY

Butac is produced by esterifying acetic acid with butanol in the presence of sulphuric acid, which acts as a catalyst. The acetic acid, butanol and sulphuric acid are heated in a reactor to 89˚C (192˚F). Vapours containing butac, butanol and water are removed and condensed.

The top layer is fed to a low boiler column where unreacted alcohol is flashed off and recycled to the reactor. The crude ester mixture undergoes a second distillation to separate the butac from other byproducts.

OUTLOOK

BASF’s resumption of normal production rates at Ludwigshafen has returned the European butac market to the structurally long situation last seen in September 2016 where the three major European producers (BASF, INEOS and OXEA) are all producing at normal rates. This situation has the potential to cause supply in Europe to become long, which would put downwards pressure on prices.

The main question for 2018 is whether, despite this lengthening of supply and demand likely to remain stable, prices will remain at levels consistent with 2012-2014 or will fall to the lower levels seen in 2015-2016. Several sources said that they expect some downward pressure on pricing in early 2018, though they did not believe that prices would return to the levels seen immediately before BASF declared force majeure in 2016.

A buyer said that it expected pressure from its downstream customers to reduce prices now that BASF’s force majeure has ended, which would put pressure on the prices it is paying for butac in order to maintain its margins.

The source also said that it expected competition on pricing from Russian and Polish producers, who were more active than usual in northwest Europe during BASF and OXEA’s production issues. However, upstream factors will also be a strong influence, with higher crude oil and propylene prices opposing the downwards pressure caused by the normalised supply situation.

Price movements for key feedstock NBA could also be influential on butac prices. NBA is expected to be stable to soft but supply limitations caused by scheduled shutdowns may limit further price decreases which could be passed through to butac.