US ACRYLATES EXPECTED

US acrylic acid and acrylate esters demand in 2017 is likely to trend flat with 2016 or fare slightly better, in line with higher GDP forecasts.

Most sources pegged year-on-year growth in 2016 at an average of 5%, and 2017 estimates are similar, especially with GDP estimated stronger but not significantly.

 The US acrylates market typically follows GDP, so growth in 2017 is anticipated a little better than in 2016 – about 2-2.5% by some estimates.

A bit more optimistic is Moody’s Analytics estimate of US GDP growth at just below 3.0% in 2017, but above 3.0% in 2018 due to fiscal stimulus expected from President Donald Trump in the form of federal infrastructure spending and tax cuts.

US GDP growth has not risen above 3% since the end of the 2008-2009 recession.

Also driving a mostly optimistic near-term acrylates outlook is the first-quarter 2017 paint-blending season, which seasonally boosts demand for acrylic acid ahead of typically peak spring coatings demand in the second quarter.

Acrylates pricing headwinds, however, could include potential pressure from volatile primary feedstock propylene and some forecasts of increased snowfall in the winter of 2017. Inclement winter weather could dampen and/or delay the usual seasonal spring-demand highs.

As for how demand levels will balance with supply, a seller said it anticipates a snug market.

“We will keep our domestic customers supplied, primarily,” the producer said. “We will have enough to satisfy US demand which, if you look downstream, usually reflects GDP. I don’t see anything different from the capacity side, just keeping pace with demand.”

Though there were some operational issues in 2016, the market was broadly disciplined regarding price and supply constraints, a source said, and it expects the same in 2017.

Acrylates are commonly used to make products including paint and coatings, ACIDS ACRYLATES plastics and construction and pressuresensitive adhesives.

US acrylates suppliers include Arkema, BASF, Dow Chemical and Sasol.

 Company Location Timing Dow Chemical Deer Park, Texas 580,000 t/yr Arkema Clear Lake 270,000 t/yr BASF Corp - Chemical Division Freeport 230000 t/yr American Acryl Bayport, Texas 120,000 t/yr Dow Chemical Co Taft, Louisiana 110,000 t/yr US Acrylic Acid capacity, tonnes/year

US Acrylic Acid capacity, tonnes/year