Haldia Petrochemicals is still suffering from underfinancing

MOSCOW (MRC) -- Haldia Petrochemicals (HPL) is once again staring at the doors of Board for Industrial and Financial Reconstruction (BIFR) as its net worth is around Rs 900 crore as per the latest financial statement, reported Plastemart.

HPL's net worth should be more than Rs 1,200 crore to save it from reporting to BIFR. According to a senior HPL official, the lenders are still wary of injecting more funds and have asked the cash strapped petrochemical major to bring in more fund before they expect lenders' help.

HPL suffers Rs 50-60 crore of cash loss every month and desperately needs non-interest bearing funds to the tune of Rs 1,000 crore. HPL has defaulted on working capital loan. In March 2012, HPL was in similar situation and was about to be reported to BIFR but the board then had approved conversion of a part of HPL's loan into equity and that saved the day for HPL.

We remind that, as MRC reported earlier, Indian government is keen on completing transfer of its shares in Haldia Petrochemicals Ltd (HPL), which is facing funds crunch, before March 31 next year.

Haldia Petrochemicals Ltd is a modern naphtha based petrochemical complex at Haldia, West Bengal, India. Haldia has played the role of a catalyst in emergence of more than 500 downstream processing industries in West Bengal with a capacity to process more than 3,50,000 TPA of polymers, among which are polyethylene (PE) and polypropylene (PP).
MRC

MOSCOW (MRC) - Belarus Mogilevkhimvolokno on prices increase in foreign markets raised January price for the domestic market by BRb2.1 m/tonne, excluding VAT, according ICIS-MRC Price Report.

In January, the price of the Belarus PET for the domestic market has grown on price increase of imported PET and rising trend in external markets. The material for production of PET preforms increased by BRb2.1 m/tonne, excluding VAT, compared to December price. According to converters, the price level of the plant was voiced at BRb14.7 m/tonne, FCA Mogilevkhimvolokno, excluding VAT.

According to the source, the price increase was expected. The plant does not raise the prices on the domestic market is sufficiently long period, despite the increase in supply of imported suppliers in recent months.

The cost of PET for the Belarusian export shipments increased by EUR90-95/tonne (pre-paid), from December. The increase in export prices of PET was quite reasonable. For a long time, the price of Belarusian PET remained below the price of PET in CIS markets.

Mogilevkhimvolokno is the only producer of PET in Belarus. The capacity utilization of PET granulate production of the plant makes about 80,000 tonnes per year.


MRC

MOSCOW (MRC) -- The Japanese petrochemicals industry has been beset by declining domestic demand and the situation is unlikelyto improve radically in 2013 with growth set to decline, according to BMI's Japan petrochemicals report, reported MarketResearch.

The appreciation of the yen and competition from new plants starting up in the Middle East and Asia aggravated the situation of petrochemical industry in Japan, which is unlikelyto improve radically in 2013 with growth set to decline to 1.2% from 1.5% as the country struggles to find new markets and suffers because of weakening demand both at home and abroad. The competition is likely to be fierce with an additional 3.39m tonnes per annum (tpa) of ethylene capacity set to come online in Asia over 2013. Closures are planned over the next two years as Japanese producers seek torestructure operations, but a further slump in both domestic and regional markets could lead to permanent shut-downs.

Mitsubishi Chemical is set to reduce total ethylene capacity at its Kashima complex by 340,000 tpa, reducing total national capacity to 6.46mn tpa by 2017.

Tosoh's proposed restructuring of operations in Nanyo could lead to a net loss of 320,000 tpa of vinyl chloride monomer (VCM) capacity, thereby tightening feedstock supply to the polyvinylchloride (PVC) industry. Almost one year after a fire seriously damaged its complex in Nanyo, Tosoh Corporation (Tokyo, Japan) has touted plans to raise output at the site's number 3 vinyl chloride monomer plant. The building phase of the 200,000 t/y capacity expansion was to kick off in November this year, with completion scheduled for October 2014.

A total of 179,000 tpa of polypropylene (PP) capacity is scheduled to come offstream over the next two years, although low operating rates in the segment may prompt further reductions.

We remind that, as MRC informed earlier, in late October Mitsubishi Chemical Performance Polymers (MCPP) acquited a polyvinyl chloride compound plant in Bellevue, Ohio (USA) from A. Schulman, in a move to expand its presence in North America's polyvinyl chloride (PVC) compound market.
MRC

MOSCOW (ICIS-MRC) - The scheduled shutdown on turnaround of the largest petrochemical complexes in the Middle East amid active purchases from Asian markets resulted in a serious increase in prices of polyethylene (PE) and polypropylene (PP). January prices of PE and PP for CIS markets increased by USD80-130/tonne, from December, according to ICIS-MRC Price report.

Planned turnarounds of the largest GCC petrochemical complexes along with high demand from Asian markets have become one of the main drivers for the increase in PE and PP prices. Asian and Middle Eastern producers increased prices over the month by USD80-130/tonne.

The largest petrochemical complex in the UAE Borouge stopped its capacity for scheduled turnaround. 10 plants from GCC countries (with the total monthly capacity of LLDPE 118,000 tonnes, 353,000 tonnes of HDPE and 238,000 tonnes of PP) plan to stop on turnaround over January-April 2013. These turnarounds coincid with a period of active procurement (January-February) of PE and PP from Asian markets, particularly China and India.

GCC producers are planning to meet the needs of the Asian market primarily, and only then the markets of Africa, Europe and Turkey. The limited supply from the largest suppliers is pushing prices up.

The price increase also refers to CIS markets. The deals for January shipment of Middle Eastern and Asian HDPE and LLDPE are in the range of USD1,630-1,700/tonne, CFR St. Petersburg and Odessa. PP increased up to USD1,600-1,640/tonne, CFR St. Petersburg and Odessa, for PP-homo.

Some market participants believe that in March after reopening of GCC plants from turnarounds, and an increase in export quotas, PE and PP prices will be going down. Though the current price rise was caused by a limited supply there is no fundamental economic reasons for price increase. Middle Eastern producers, in their turn, say that the current price increase is economically grounded by the current price of oil.


MRC

MOSCOW (MRC) -- DSM Dyneema, the inventor and manufacturer of ultra high molecular weight polyethylene (UHMWPE) fiber branded as Dyneema, officially opened its new Asia Pacific Technical Center in Singapore on 11
January, reported compositesworld.

In addition to traditional materials testing capabilities, the center houses Singapore’s first-ever independent ballistics testing facility, featuring two ballistic ranges, as well as labs for conducting comprehensive tests for both personal and vehicle armor applications in Dyneema. Tests can be carried out in accordance with international and regional ballistics standards. For DSM Dyneema, this will be the third global ballistics testing facility, complementing the existing technical centers in the U.S. and Europe.

"With the setup of the Technical Center in Singapore, DSM Dyneema will be able to further expand and reinforce its global R&D expertise via local channels," says Christian Widdershoven, vice president, marketing and sales at DSM Dyneema. "The center is designed to meet current and future needs of customers in the rapidly growing Asia Pacific region. It will bring our company and solutions closer and faster to them."

We remind that, as MRC informed earlier, DSM is going to invest about EUR100 million in three new R&D facilities in Delft and Sittard-Geleen (both in the Netherlands) over the next two years.

In November 2012, DSM reached an agreement with Borealis AG for the sale of DEXPlastomers V.o.F, a 50/50 Joint Venture of DSM with an affiliate of ExxonMobil Chemical. DSM will also sell its LLDPE Compact Solution Technology to Borealis. Subject to customary approvals and notifications, the transaction is expected to close in Q1 2013.
MRC