Chinese producer Yisheng Petrochemical announced today that it has permanently shut its oldest purified terephthalic acid (PTA) line, the 650,000 t/yr No.1 unit, at its Ningbo site in east China's Zhejiang province.
The main reason for the closure is weak production margins. A massive expansion of PTA capacity in China over the past two years has squeezed margins, and Yisheng — China's largest PTA producer — does not expect significant improvements in the coming years. The typical breakeven cost for a PTA unit of this scale is around or above 700 yuan/t ($108/t), much higher than Yn400-500/t for larger and newer plants.
A new round of shutdowns of older producers began in China in March. State-controlled Sinopec Yangzi Petrochemical dismantled its 300,000 t/yr No.1 PTA unit in Nanjing in April, while producers Zhejiang Reignwood and Ningbo Liwan have kept their production lines idle since March.
More such closures will be seen in the future with the planned start-up of new plants in China. Yisheng plans to bring on line a new 3mn t/yr PTA production line at its Ningbo site in early July.
