OREANDA-NEWS. South Korea's Hanwha General Chemical plans to shut its No.1 and No.3 purified terephthalic acid (PTA) units at Ulsan from 24 October, with no immediate plans for a restart. The facilities have total nameplate capacity of 850,000 t/yr.

The negative paraxylene (PX)-PTA margin is the main reason for the shutdown. PX-PTA margins have fallen below $70/t since the second half of July, prompting Hanwha to lower operating rates at its Ulsan units by 20pc to 80pc in early August. But margins have been squeezed further in the past month, falling to $50/t in the first half of September.

Increased supply of the fiber intermediate in India has hit Korean exports to that country, as well as to buyers in the Middle East since August. The fall in demand has combined with negative margins to force Hanwha to cut production from next month.

Hanwha General Chemical operates four PTA lines in Korea, comprising three lines at Ulsan with total capacity of 1.3mn t/yr and one 700,000 t/yr line at Daesan.