Several phthalic anhydride plants in West Europe have been affected by a string of production problems over the last few months, in addition other units have gone through planned turnarounds during this period and therefore supply in the region has tightened very quickly. In the last month, there has also been a sharp increase in flake spot prices, partly due to the production problems at the largest flake unit in the region, Atmosa.
As for the outlook for 2017, market players are reporting strong demand in the first quarter and are cautiously optimistic for the remainder of the year. In West Europe, phthalic anhydride consumption is forecast to grow at around GDP level.
Consumption in the largest applications, phthalates and UP resins, is expected to remain relatively stable, on the other hand overall demand will be supported by healthy growth in the polyols sector, which could grow at around 10% this year, driven by consumption in rigid foam insulation in roofing and the trend towards using polyester polyols instead of polyether polyols, due to their better fire retardant properties.
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