Covestro to continue MDI production in Tarragona, suspends closure of facility

Having announced in December that it would shut down its MDI production in Tarragona, Spain, that has capacity of 170,000 tonnes/year by the end of 2017 due to not being competitive, materials manufacturer Covestro has rethinked its strategy.

It now says it has resolved to continue manufacturing the rigid foam precursor MDI in Tarragona and the plant closure that had originally been planned for the end of 2017 has been suspended for the time being. The main reason for this decision was the significant increase in demand for MDI.

Furthermore, Covestro says it has managed to get access to important raw materials – in particular chlorine – for the Tarragona site for the next years beyond the end of 2017. According to current plans, the impact on the employees will be minimixed.

“This is good news for the Tarragona site and our employees. Through our continued operations in Tarragona, we want to reliably meet our customers’ growth further on,” said Andrea Firenze, Managing Director of Covestro S.L. in Spain.

The continuous optimixation of the production worldwide remains an important element of Covestro’s strategy. The aim is to operate the most efficient facilities when compared with competitors.

“The decision is a clear statement that we remain committed to the MDI market. We will investigate various options for additional MDI to cover the growing demand”, added Markus Steilemann, Head of the Business Unit Polyurethanes and Board Member for Innovation. In this context, Covestro is committed to its plans to increase MDI production at its German site in Brunsbüttel.

MDI is an important component in the manufacture of polyurethane rigid foam, which is amongst other applications used for effective building insulation and along the entire cold chain. The energy savings achieved lead to reductions in CO2 emissions.

Covestro has two locations in Spain that currently employ around 330 people. The Covestro site in Barcelona (Zona Franca) is dedicated to the manufacturing of resins and the production of coatings, textile and fabric treatments, acrylic dispersions and polyurethanes. At the end of 2016, the company announced the incorporation of a new production line of polyurethane dispersion for coating textiles.

At the Tarragona location, Covestro operates an MDI facility, a polyurethane system house and infrastructure facilities that are also available to other companies in the chemical park. In addition, a logistics center for hydrochloric acid will be built here, with an investment of around EUR3 million.