Covestro to Hang onto Tarragona MDI Site

14.12.2017 -

Engineering plastics producer Covestro has committed itself to continuing production of MDI in Spain rather than close its plant at Tarragona at the end of this year as envisioned two years ago. The former BayerMaterialScience, still based at Leverkusen, Germany, said it now plans to keep the facility open “beyond 2020.”

Based on the timetable for the just announced €200 million upgrade of the Spanish site up to 2022 and the still buoyant demand for the polyurethane precursor, production seems likely to continue for years to come. Chief Commercial Officer and CEO-designate (from April 2018) Markus Steilemann said he expects MDI demand to continue growing ahead of supply.

After the separation from Bayer, the newly independent company had considered concentrating MDI output at Brunsbüttel and Uerdingen, Germany. Last spring, it hinted at a strategy revision, saying that Tarragona would stay on stream for the “foreseeable future,” before making the official announcement this week.

CEO Patrick Thomas stressed that the plastics producer is “fully committed” to the MDI market and to Tarragona.  With the planned upgrade of the 170,000 t/y Spanish facility to add 50,000 t/y of capacity through debottlenecking – along with the establishment of a captive chlorine supply – the site will become a more competitive and efficient part of the European production network, he said.

Covestro is also widening MDI output is elsewhere. Up to the end of 2018, capacity is ar Brunsbüttel will be doubled to 400,000 t/y.

The two German sites have their own chlorine production, and the decision to keep Tarragona running was contingent on its having a captive supply. In the past, the company’s needs were met by Barcelona-based Ercros, but the supplier’s mercury process plant was forced to close, due to new EU regulations that favor the more environmentally friendly membrane process.

Until the new plant for the key raw material starts up at the end of 2020 – a capacity figure has not been disclosed –  chlorine will be sourced externally.