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Petrochemicals

China’s Wanhua scales back US polyurethane project

The company blames rising capital costs for the project’s woes

by Alexander H. Tullo
September 5, 2019 | APPEARED IN VOLUME 97, ISSUE 35

 

09735-buscon2-wanhuacxd.jpg
Wanhua's complex in Ningbo, China

The Chinese polyurethane chemical maker Wanhua is scaling back and possibly changing the location of a $1.25 billion methylene diphenyl diisocyanate (MDI) plant it intends to build in the US.

Wanhua in recent years has vaulted ahead of competitors such as BASF, Covestro, and Dow to become the largest producer of the polyurethane raw material in the world. The company announced the project in 2017 and selected Convent, Louisiana, as the site last November. Construction was slated to begin this year and be completed in 2021.

Subsequent indications suggested that the project was moving forward. In its annual report, published earlier this summer, Wanhua said that “contract negotiations and related bidding work” were progressing.

In addition, Wanhua hosted Louisiana Economic Development Secretary Don Pierson at its Yantai, China, site this spring. “I have every confidence in Wanhua,” Pierson said in a company press release at the time.

William Day, a US-based Wanhua official, says in a statement that the company is being forced to “change the scope” of its plans because of “a significant increase in the capital expenditure budget of the MDI project in the past year.” It is also reviewing a new location for the plant.

“Nevertheless, the company’s plan and commitment to build an MDI facility in the US remains unchanged,” Day says.

Another Wanhua official in the US, Jacob Sturgeon, told C&EN in June that new US tariffs on MDI from China impeded the company’s efforts to establish an import market before opening the plant.

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