Covestro’s European MDI equipment was forced to reduce its load. MDI continues to prosper, and Wanhua Chemical hopes to seize the market – TMPDA – Tetramethylpropylenediamine

Due to a supply failure of raw material nitric acid, Covestro’s European MDI and TDI plants were forced to reduce their load: On October 6, Covestro announced that its nitric acid supplier’s production plant in Europe was The factory failed to restart as scheduled after routine maintenance, and it was unable to provide sufficient raw material supply to Covestro’s MDI and TDI devices in Europe. This supply gap cannot be made up through outsourcing. Covestro has been forced to reduce the production load of TDI and MDI in Europe, and cannot guarantee on-time delivery and supply of products. The duration of this load reduction cannot yet be determined.

Covestro’s European MDI production capacity is 370,000 tons. This reduction will seriously affect the European MDI supply, and the gap between supply and demand is expected to remain in the future.

World MDI consumption is mainly concentrated in Asia, Western Europe and North America, accounting for more than 85% of total consumption. Among them, demand in Western Europe accounts for 22% of the world, second only to demand in Southeast Asia. Currently, Covestro has 200,000 tons of MDI production capacity in Germany and 170,000 tons of MDI production capacity in Spain. This force majeure reduction will seriously affect the European market supply. In addition, Covestro will shut down its production capacity in Spain at the end of 2017, mainly due to its high production costs. Although in June this year, Covestro announced the expansion of its production base in Brunsblit, Germany, with the expanded production capacity reaching 400,000 tons, the new plant is not expected to be commissioned until the end of 2018. Therefore, there will continue to be a gap in MDI supply in Europe. Wanhua Chemical actively explores overseas markets and has production bases in Yantai, Ningbo, Hungary and other places. The group has a production capacity of 240,000 tons in BC, Hungary. The sales network covers China, the United Arab Emirates, Brazil, Russia, South Korea, the United States, Japan, Turkey, India and other countries. Compared with the domestic market, the company’s overseas operating income still maintained rapid growth during this period, with an average annual compound growth rate of 19.11%. In 2015, although overseas operating income fell by 7.13% year-on-year, product sales in overseas markets still maintained more than double-digit growth. Due to the tight supply of MDI in Europe, the company is expected to seize the opportunity and further expand its market share.

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