Europe's Iran embargo starves region of EG, US tries to fill hole

HOUSTON (ICIS) -- European trade sanctions against Iran has left the continent without a major source of ethylene glycol (EG), and US suppliers take advantage of a wide-open arbitrage window, a trader said on Friday.

US suppliers can sell EG at a net price of about 45 cents/lb ($992/tonne or ┬714/tonne) in Europe, and higher prices could be on the way. One week ago, US spot prices of 38-39 cents/lb were considered high, the trader said.

US EG has been tight following a series of turnarounds beginning in late July and lasting through September. Unplanned cracker outages in the third quarter added to the lack of supply.

The supply shortage in Europe was due primarily to a lack of supply from Iran amid recently enforced trading sanctions, the trader noted.

Through the first six months of 2010, approximately 25,000 tonnes of EG were exported to Europe from Iran, compared with about 60,000 tonnes of supply in 2009.

US EG producers include Equistar, Huntsman, MEGlobal, Old World, SABIC and Shell.

MRC

MOSCOW (MRC) -- By the end of October - beginning of November the Russian market expects DOP price fall - MRC analysts say.

Next week the restart of DOP fabrication is expected after long-term suspension of Plasticizers fabrication plant in Roshal. DOP fabrication volumes in Roshal on the average makes 2-2.1 kt per month. The start-up will allow to decrease the Russian market dependance from the imports considerably, as per marketers opinion. The price fall is also expected along with the plant start-up.

Deficit in the Russian DOP market began in April because of the necessary suspension of production in Roshal. By early October the Russian DOP price level has reached 88.000 - 91.500 RUB/t, including VAT, FCA.

MRC

CINCINNATI (Plastics News) -- Consumer products giant Procter & Gamble Co. has announced a sweeping sustainability effort, one that likely will have far-reaching impact on the plastics industry.

P&G spokeswoman Rotha Penn confirmed that the company's long-term vision is to eliminate all petroleum-based virgin plastic. P&G earlier this year announced plans to use Braskem SA's sugarcane-derived polyethylene in selected packaging for P&G' products.

Len Sauers, P&G's vice president of global sustainability, said that P&G plans to entirely eliminate PVC packaging within two years.

P&G began to avoid the use of PVC in packaging in the early 1990s. Today, PVC represents less than 1.5 percent of the company's total use of plastic packaging materials.

MRC

LONDON (ICIS) -- BASF's 60,000 tonne/year capacity expansion of its biodegradable plastics plant in Ludwigshafen will go on stream at the end of 2010 to meet rising market demand, the German chemical major said on Friday.

The group expected a significant market growth for biodegradable plastics through to 2020, he added.

BASF first announced the expansion of its Ecoflex production line to 60,000 tonnes/year from 14,000 tonnes/year in April 2008. BASF said it wanted to focus on improving the performance of its products Ecoflex and Ecovio as biodegradable and compostable plastics for agricultural use.

As a consequence, its business with the additive Envirocare, which was part of the Ciba range used to manufacture polyethylene mulch films, was terminated effective 1 July 2010, BASF added.

MRC

SINGAPORE (ICIS)--Thailand's PTT Chemical will shut its 400,000 tonne/year linear low density polyethylene (LLDPE) plant at Mab Ta Phut in Rayong province on 9 October for maintenance, a company source said on Friday.

⌠The maintenance will last for about two weeks, he said.

PTT Chemical's plant shutdown was unlikely to have significant impact on local supply as the other two LLDPE plants at Mab Ta Phut, eastern Thailand, with a combined capacity of 420,000 tonnes/year were still running, domestic distributors said.

The other two plants are operated by Thai Polyethylene and Siam Polyethylene.

mrcplast.com