United States petrochemicals sector surprised to the upside in H212

MOSCOW (MRC) --The US petrochemicals report examines the short-term trends in domestic consumption and production growth going into 2013, when the local market will feel the effects of the continued global economic slowdown and the eurozone debt crisis, as per Sbwire.

The performance of the US chemicals sector surprised to the upside in H212. Strong growth in the automotive and construction sectors was driven by rising activity in construction related resins, coatings, pigments and other chemicals. In terms of ethylene production, output in Q312 totalled 6.2mn tonnes, down 0.6% year-on-year but up 10.7% quarter-on-quarter.

Ethylene margins gained towards end-2012 due to a fall in ethane feedstock prices caused by longer supply, although this was partly undermined by weaker spot prices and lower cracker co-product values for chemicals such as propylene, butadiene and benzene. The fall in ethane costs filtered through to improved polyethylene (PE) margins.

As MRC wrote this week a number of US companies increased their prices of PE.

Over the long term, the proposed pace of growth in US ethylene capacity could lead to a bust after 2017, when ethylene capacity will total at least 32.8mn tonnes per annum (tpa) and could potentially top 40mn tpa. An increase in cracker capacity – by a third in 2016-2017, and by 50 %by 2020 based on currently confirmed plans – will cause regional and global shock-waves, particularly if it coincides with a downturn in the economic cycle.

US ethane-fed petrochemicals production can undercut naphtha-fed Latin American output and boost US participation in the regional market. As a result, US PE exports could exceed 40% of output by 2017, up from around 20% in 2012.

MRC

MOSCOW (ICIS-MRC) -- Higher prices of feedstocks for the production of PET in Asia resulted in an increase of export prices of PET granulate by USD30-40/tonne, which led to a price rise for the material for Russian, Ukrainian and Kazakh consumers of granulate, according to MRC Price report.

Prices of bottle PET granulate in the foreign markets keep their upward dynamics on an increase of productions costs. The price hike for feedstocks resulted in the PET price to rise in Asia by more than USD100/tonne over the past four weeks, report converters.

This week, the purchasing price of Asian bottle PET for Russian consumers, including delivery to the Central region, makes USD1,670-1,700/tonne, DAP Moscow, excluding VAT.

The price of Asian PET granulate in the Ukrainian port grew to the level of USD1,660-1,690/tonne, CIF Odessa, excluding VAT.

The price offer of Asian bottle PET for Kazakh buyers, including delivery, made USD1,755-1,785/tonne, DAP Almaty, excluding VAT.

As it was reported earlier, PET producers in Russia are increasing prices for their production following the upward trend of quotations in Asia. On the price hike of the imported feedstock and absence of large stocks residues, last week Russian makers of PET granulate raised their prices by Rb1,000-2,000/tonne from the last week of December.
MRC

MOSCOW (MRC) -- Georgia Gulf Corporation announced that when its pending merger with PPG’s commodity chemicals business is completed, it will change its name to Axiall Corporation. The company will trade on the New York Stock Exchange under the ticker symbol AXLL, said Georgia Gulf in its press-release.

"The new and distinctive brand represents a clear break from the legacy names of the two businesses, and gives us the flexibility to enter new markets, make future acquisitions, and diversify our portfolio without the need to rebrand our organization."

"The new name is the result of more than five months of effort and creativity by a group of employees from both Georgia Gulf and PPG," said Paul Carrico, president and chief executive officer.

As MRC wrote earlier, Georgia Gulf and PPG's announced the merger between commodity chemicals business in July,2012.

Georgia Gulf Corporation is a leading, integrated North American manufacturer of two chemical lines, chlorovinyls and aromatics, and manufactures vinyl-based building and home improvement products.

Pittsburgh-based PPG will continue to operate with a focus on its other businesses, including paints and coatings, glass and fiberglass, and specialty materials like silicas. The company operates in more than 60 countries around the world.


MRC

MOSCOW (MRC) -- The first working week of 2013 in the Russian polyethylene market was fairly quiet. Polyethylene prices remained unchanged in comparison with the last week of December, according to a Price Report ICIS-MRC.

Expectedly buying activity in the first week of the current year in the Russian polyethylene market was quite calm, especially in the first half of the week. The converters did not replenish their inventories. Quite a big number of converters in the second half of December formed their inventories for the first half of January.

The price spread in the market of low-density polyethylene (LDPE) is still quite wide. The offers for the supply of 158-LDPE was voiced on average at Rb53,500-56,000/tonne, including VAT, CPT Moscow. Buying activity is low; the offer of polyethylene is ample.

The market of HDPE last week was also quite calm. The prices injection moulding HDPE declined slightly in the spot market under the pressure of low demand and excess supply. HDPE prices remained at the level of the second half of December and were at Rb71,000-73,000/tonne, including VAT, CPT Moscow, for the film grades, and Rb65,200-66,000/tonne, including VAT, CPT Moscow, for injection moulding PE.


MRC

MOSCOW (MRC) -- A new innovative TE-cap, a combination of a lightweight paper pot and a deep-freeze grade polypropylene (PP) lid, was developed by IPS. The patented lid design provides a tamper evident seal delivering product security, with easy opening and re-closure for consumer convenience, reported Plastech.

Historically tamper features were usually limited to injection moulded pots. This innovative lid means that now even paper containers can be made Tamper Evident. The packaging features an injection moulded break-off tab and skirt which eliminates the need for foil or membrane sealing and provides instant evidence of any interference. This is a convenient way to assure the consumer that package contents have not been tampered with prior to purchase.

According to Gerard Connolly, Sales and Marketing Manager at IPS, brand owners are looking to protect their most valuable asset - their brand. The TE-cap is the perfect packaging solution; it eliminates the need for heat sealing, improves line efficiencies, optimizes package safety and protects their brand. The company is confident that the TE-cap will make an immediate impact in the frozen dairy sector. It offers effective decorative options for visual impact and maintains product freshness, making it ideal for other markets including chilled foods and ready to eat products.

We remind that another large chemical producer Borealis, had launched last year the next generation transparent polypropylene (PP) grade Borpact SH950MO for packaging of deep freeze products. SABIC has also developed a new brand of high clarity polypropylene SABIC PP Qrystal QR681K, as MRC reported earlier.
MRC