Dow has launched a new MDI distillation and prepolymerization unit into commercial operation at its Freeport, Texas, manufacturing site. This investment will help optimize Dow's existing manufacturing facilities and strengthen Dow's leading position in attractive applications such as the automotive, construction, consumer and industrial markets.
This new Freeport MDI unit replaces Dow's North American capacity in La Porte, Texas, and will provide Dow customers with an additional 30 percent of their product supply. In conjunction with the start-up of the new MDI facility, Dow shut down the polyurethane production facility at its La Porte facility.
Jane Palmieri, President of Dow's Industrial Intermediates and Infrastructure Operations, said: "Our customers are seeking cost-competitive and reliable supplies of upstream polyurethane critical raw materials to support their growth. The back-end integration of the Freeport manufacturing site increases operational flexibility and reliability, and provides a more sustainable production process, ensuring we are in the best position to support customer demand and downstream growth."
The new facility in Freeport reduces Dow's annual greenhouse gas emissions from operations, reduces freshwater intake and reduces the proportion of wastewater discharged each year, resulting in a more sustainable production process.
Global MDI capacity distribution
Diphenylmethane diisocyanate (MDI) is one of the main raw materials for the production of polyurethane, and polyurethane (full name of polyurethane) is a material that can be used in the production of plastics, fibers, coatings, rubber and other products, and can be used in household appliances, construction, transportation and other scenarios. It is known as the sixth largest synthetic material (the remaining five major synthetic materials are PE, PP, PVC, PS, PET).
Because MDI has high technical barriers, high financial barriers, complex technology, and difficult production management, MDI production technology has been blocked in the hands of the giants, thus limiting new entrants in the industry, and MDI global supply is an oligopoly.
In 2022, the total global MDI production capacity is about 9.9 million tons/year, of which Wanhua Chemical's annual production capacity reaches 3.05 million tons, accounting for 31% of the global production capacity, ranking first in the world, and BASF (1.81 million tons/year), Covestro (1.77 million tons/year), Dow Chemical (1.36 million tons/year), Huntsman (1.4 million tons/year), In total, it occupies more than 88% market share.
In April 2023, after obtaining the controlling stake of Yantai Juli, Wanhua Chemical added 400,000 tons/annual production capacity, further securing the leading position in the MDI industry.
On July 31, BASF and Huntsman, together with their Chinese partners - Shanghai Huayi, Gaoqiao Petrochemical and Shanghai Chlor-Alkali Chemical - announced the separation of the joint venture MDI production facility of Shanghai Lianheng Isocyanate Co., LTD. (SLIC). After the reorganization of Shanghai Lianheng, BASF MDI's global production capacity will reach about 1.9 million tons. In addition to the Caojing plant in Shanghai, BASF also has MDI production sites in Chongqing, China; Yeosu, Korea; Antwerp, Belgium; and Geismar, Louisiana, United States.
