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Nitroaromatics Nitrochlorobenzene These chemicals are used in the manufacture of dyes, intermediate dyes, pharmaceuticals, agrochemicals and rubber chemicals. The nitro chloro benzenes can classified in three forms Para nitro chlorobenzene (PNCB) Ortho nitro chlorobenzene (ONCB) Meta nitrochlorobenzene (MNCB) Manufacturing process These products are produced by continuos nitration of monochlorobenzene with nitric acid and sulphuric acid. The process involves chlorination in the first stage, which results in the formation of MCB. Second stage involves the process of nitration in which chlorobenzenes are produced. The third stage involves crystallization process where crude NCBs are purified. For producing 1 ton of NCB 0.75 ton of benzene and 0.7 ton of chlorine is required. To produce 1 ton of NCB -0.77 ton of NCB, 0.44 ton of nitro acid and 0.4 tons of sulphuric acid are required. The technology has an in built changeover facility so that the production can shift from one nitroaromatic compound to another. PNCB is available as flakes and in molten form. Transportation and storing is a problem, as molten form requires heated tanks. ONCB can be stored and transported as a liquid. MNCB is usually thrown away, as it has no use. The production of these three compounds (namely PNCB, ONCB and MNCB) is in the ratio of 65:34:1. Thorough research is being undertaken to improve production as well as purity, which is often the main criterion in sales. Markets ONCB In terms of consumption of ONCB demand comes from agrochemicals. The pharma sector especially Sandoz, United Phosphorous and Gujarat Insecticides utilize it to produce quinalphos. The demand has declined mainly due to substitute products being used instead of ONCB. The remaining demand for ONCB comes from dyes and intermediates. This is used as an intermediate product for the manufacture of red dye and aniline. The remaining demand comes from the rubber chemicals, synthetic aromatics, perfumes and lubricants. PNCB The demand has seen a growth of about 20% in the previous decade. The major demand comes from pharma sector. This is basically used in the manufacture of framycetin, paracetamol and dyes. Dyes account for more than 40% of the total demand. They are used to manufacture para-chloroaniline, para-nisidineand para-nitroaniline. The export sector of this product is growing at a healthy pace. Agrochemicals and rubber chemicals contribute nearly 25% of the total demand. MNCB It is used in the manufacture of aniline dyes like fast orange base and aniline based drugs. The demand is skewed in terms of regional concentration and time period. As the dyes and textile units are located in the western region, the demand for Agrochemicals peaks in the months from April to July. While the demand for pharma products peaks in the months from July to August. Demand and supply The demand and supply scenario is slightly complicated, as PNCB and ONCB are co- produced. The price movements are inverse in terms of these co-products. In case of PNCB there has been an oversupply. While there has been a lack of supply of ONCB due to rising international prices and substantial increase in exports. Any effort to increase the production of ONCB leads to the production of PNCB and hence will lead to the fall in the already low prices. Imports are not a threat as internationally the producers are facing difficult times due to environmental and economic concerns. Raw material & production costs These constitute around 40-45% of the total production costs. Chlorine and Benzene Most of the plants are in the process of integrating backwards, as chlorine and benzene are the building blocks of nitochlorobenzenes. MCBs Most of the producers produce this in-house. There are a few who buy it from outside producers but it does not effect the profitability. Acids Most of the companies are launching their own acid manufacturing plants as the freight cost of acids, especially nitroacids is an expensive proposition. The capital cost of setting up a plant of 5,000 ton capacity, is to the tune of Rs3.15bn Outlook There is a threat of oversupply. Exports are a succor only in the case of ONCB, as international prices are rising and exports are increasing at a healthy pace, while in case of PNCB the demand is declining hence an oversupply in the markets is resulting in the fall of prices.The total demand for PNCB is expected to be around 29,000ton, while the demandfor ONCB is expected to be around 17,500ton. Other sector reports Previous chapter Next chapter

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