Celanese considering construction of new acetic acid plant in U.S. or China due to countries' less expensive raw materials, proximity to customers

LOS ANGELES , October 26, 2011 () – The CEO of Celanese Corp. said the company might build a new plant to make acetic acid in the U.S. or China because of the countries’ less expensive raw materials, Bloomberg reported Oct. 25.

CEO David Weidman told Bloomberg the cost advantage of making the acid from either U.S. natural gas or Chinese coal is quite "compelling." Mark Oberle, a company spokesman, told Bloomberg that a decision will be made sometime over the next six months.

Oberle said that since Celanese is rerouting some of its acid-making capacity to ethanol production in Nanjing, China, it must expand to retain at least one-third of the 11 million ton annual market for acetic acid. Celanese invested roughly US$350 million over three years to build the Nanjing complex, Oberle added. Two of the company's acetic acid plants, one in Singapore, the other in Clear Lake, Texas, may be expanded from 1.2 million tons of output yearly to 1.5 million tons, Oberle told Bloomberg.

Inexpensive feedstock is not the only factor being considered regarding the construction of a new plant, Oberle said. The other factor is proximity to customers. U.S. has an advantage because of its proximity to customers in Europe, and China is the center of explosive Asian growth, he added.

The primary source of this article is Bloomberg, New York, New York, on Oct. 25, 2011.

* All content is copyrighted by Industry Intelligence, or the original respective author or source. You may not recirculate, redistrubte or publish the analysis and presentation included in the service without Industry Intelligence's prior written consent. Please review our terms of use.