Despite attractive VAM prices, Taiwan's Dairen Chemical will run its vinyl acetate monomer (VAM) plants in Mailiao at an average of 70% during November. These run rates are unchanged from October due to a continuing shortage of ethylene feedstock and, as per Platts. Dairen has two VAM plants at Mailiao with a combined capacity of 650,000 tpa, being supplied ethylene feedstock by Formosa Petrochemicals. Ethylene supply from Formosa had been tight since July as it had to shut down its No. 1 naphtha-fed steam cracker on July 7 following a fire.The No. 1 cracker, which capacity to produce 700,000 tpa of ethylene was restarted on October 1. At the same time, Formosa shut its No. 2 naphtha-fed steam cracker at Mailiao October 5 for 40 days of routine maintenance. The No. 2 steam cracker is able to produce 1.03 mln tpa of ethylene.
Buying ethylene in the spot market is not being considered a viable option, as this would push up the ethylene prices as not many spot cargoes were heard available. VAM prices on a CFR China basis were around US$949/mt, while feedstock ethylene was around US$1045/mt CFR Northeast Asia.