Uses

The largest use for methyl methacrylate (MMA) is to make polymethyl methacrylate (PMMA), which once cast or moulded, is clear, hard, UV-transparent and resistant to gamma rays. Another major application is in surface coatings. Methacrylate butadiene styrene resins are used as a modifier for polyvinyl chloride (PVC) and in food and pharmaceutical packaging.

Supply/demand

In 2020, European MMA consumption was around 570,000 tonnes, a decrease of 9.3% or around 60,000 tonnes compared with 2019, on coronavirus pandemic impacts.

We expect a full recovery to take place within two years, showing strong growth of 9.2% in 2021 followed by 3.6% growth in 2022, getting back to pre-crisis consumption levels. European MMA consumption is then expected to continue growing at around 1.2%/year in the following three years.

MMA is consumed mainly to produce the homopolymer PMMA, accounting for 52% of MMA consumption, and other products including other methacrylate monomers (EMA, BMA, 2EHMA) or in combination with other monomers to obtain other polymers with various properties.

The demand picture has been mixed so far in 2021 and this is expected to continue into Q3.

Pressure upstream in acetone has impacted MMA, causing prices to rise and forcing major producer Roehm to introduce sales controls.

The market has also been impacted by force majeures restricting product availability.

Dow’s force majeure was introduced in February, largely because the US winter storm impacted the European supply chain.

This is expected to remain in place heading into the second half of the year while US production continues its slow recovery and refills the supply chain.

Prices

Globally, prices hit highs not seen since the start of 2018.

These came as demand rebounded from the pandemic lockdowns which hit all sectors of global economies.

From June 2020, spot prices began to rise as business began to slowly open back up, marking the end of three-year downward trend.

Since then, MMA supply globally has seen a number of issues, including upstream constraints. These factors have kept the market tight.

Between June 2020 and April 2021, prices rose by more than 120%.

Imports into the region, largely from Asia, have been vital to availability and are expected to remain a key part of supply for the rest of 2021.

Contracts have also increased over the same timeframe, with significant jumps in the monthly and quarterly contract settlements.

The upward pressure on prices appears to have peaked in May 2021, with the global supply picture slowly improving.

Technology

Many plants are based on the acetone cyanohydrin (ACH) route.

Germany’s Evonik Industries has further developed the ACH route by using a new catalyst and removing the need for sulfuric acid.

Mitsubishi developed its Alpha process based on ethylene, methanol and carbon monoxide. The 250,000 tonne/year plant that came onstream in April 2018 uses this technology, with a further plant expected post-2023 by the producer.

Evonik also announced in late 2017 that it would be working on an ethylene-based MMA production method.

Some Japanese plants use isobutylene or tertiary butanol. Evonik is using technology based on isobutylene in a plant in China.

Outlook

Supply length is expected to slowly increase throughout the remainder of 2021 as the US market continues its production recovery.

This will allow more material to remain in, and be imported to, Europe as the global tightness eases.

Upstream, tightness in key feedstock acetone is also expected to ease, which would lead to softening prices.

Demand traditionally grows at approximately 3%/year on a global basis for MMA, although there are some applications at higher levels.

However, a concern is the performance of the automotive sector, which is a key end-user for both plastics and coatings.

While there was an uptick in the immediate post-coronavirus world, issues with semiconductors are causing auto manufacturers to slow and stop production, which is impacting MMA demand. There are concerns over how long this will last.

Elsewhere, there are concerns on demand when government support for economies begins to be eased, with uncertainty over what this will mean for end-use demand. ■