Methionine production at its site in Commentry, inactive since October 2022 due to challenging economic conditions, will not recommence.
Located in the Auvergne region, Commentry is the group's only multi-product site. Up until October 2023, the facility was manufacturing methionine powder (Rhodimet), coated methionine (Smartamine) and vitamins (Microvit).
In announcing a temporary shutdown of that site’s methionine powder unit last year, Adisseo cited the higher energy and raw material costs, as well as demand stagnation. The supplier had recorded long-term contract cost increases of +26% for propylene, +13% for methanol and +78% for sulphur compared to the year prior.
After a thorough evaluation, the company, a subsidiary of China National BlueStar, announced today that it has determined that restoring the plant is no longer viable. A voluntary redundancy plan, encompassing 47 positions, from a total workforce of 335, is anticipated to take effect from April 2024.
That plan will be accompanied by negotiations for a robust job protection plan with trade unions, added the animal nutrition player.
The Commentry plant represented more than 10% of European methionine capacity, noted Kemiex in 2022.
Adisseo stressed that the closing of the Dl-methionine unit at Commentry is designed to fortify the competitiveness of its production activities on a European scale. Efforts to centralize its production of that amino acid at Roches-Roussillon are aimed at safeguarding competitiveness amid an evolving and competitive landscape, it continued.
Supply outpacing demand
Hervé Alexandre, executive director of Adisseo's methionine SBU, highlighted the significant and lasting change in the methionine market globally and in Europe. Globally, methionine production capacity has outpaced demand, particularly in Europe, where powdered methionine demand is declining.
Commenting on methionine market developments today, Kemiex's Stefan Schmidinger told us:
“A preliminary estimate suggests that methionine quantities exported from France may have dropped by about -31% from 2022 to about 50,000 tons, and by -38% from 2021. In monetary terms, we are talking about an annual revenue shortfall of about €60-90m (US$65-98m).
"Coincidentally, China has ramped up production to reach total export quantities of 154,000 tons in 2023 from only 50,000 tons in 2020 with further capacities coming onstream lately and in near future.
"China’s monthly exports to the EU hit the largest on record in December 2023 (5,700 tons), totalling about 30,700 tons over the full year 2023, mostly NHU brand material.”
Despite the shuttering of the methionine powder operations, Adisseo said it is committed to preserving its industrial presence in the Commentry area. It made investments totaling just under €30m between 2021 and 2023, with an additional €20m outlay planned for 2025. The focus will shift to the production of Smartamine, a high value-added product, and Vitamin A.
Adisseo has six research centers and production sites located in Europe, the US, China, and Thailand.