US IPA Producers Increase Supplies Opportune by the Reduction in Imports

Imports to the US witnessed a major drop from various Iso Propyl Alcohol (IPA) exporters including China. However, domestic supply subsequently improved as decrease in imports prompted better margins and better sales opportunities for the domestic producers. Following, several large-scale producers including LyondellBasell revealed to have increased their allocation volumes to 100% for the customers. China exported around 2000 tons of IPA in May and June 2020, contrastingly exports fell to 49 and 5 tons for January and February 2021, respectively.

IPA prices which were already under the pressure due to the gush in Propylene prices, and have witnessed consistent surge due to the material in the US in the past few months. However, with the beginning of second Q2 of 2021, IPA prices considerably stabilized in April backed by the consistent demand and domestic production tracing back the desired levels.

Domestic prices of IPA remained stable in the beginning of April in US Gulf and were assessed at USD 1960 - 2050 per MT. Whereas export discussions settled at FOB USD 1920 – 2010 per MT.

Chemical derivatives segments constitute the largest consumption share of IPA produced in US.

As per ChemAnalyst data, US corresponds to around 72 percent of the overall IPA production capacity in North America.

Production of IPA in Q1 2021 remained under dark shadows due to the force majeure announced in the US in February following the freezing snap in the US Gulf Storm. Although, its production was comparatively less affected with respect to other petrochemical derivatives like butyl acetate and mono propylene glycol, but it remained below the desired levels as two of its major producers were compelled to induce a temporary turnaround.