Shanghai Chlor-Alkali setting up second CPVC plant

MOSCOW (MRC) -- Shanghai Chlor-Alkali Chemical Co. Ltd., a Chinese maker of chlorinated PVC, is setting up a second plant in Shanghai, said Plasticsnews.

The company's current plant there, launched in the fourth quarter of 2012, has annual CPVC capacity of 22 million pounds. That plant became operational in the last quarter of 2012.

The upcoming facility will have total capacity of 176 million pounds of CPVC, implemented in two phases. The plant should be operational by the first quarter of 2015, said general manager He Gang at Vinyl India 2013. The show was held April 12-13 in Mumbai.

In addition to China, the firm is targeting India and the Middle East. The Indian CPVC market is growing 15% annually, according to He, who estimates the country consumes about 55 million pounds of CPVC annually.
"The Indian market is dependent on imports as there is no local production of CPVC yet," he said.

As MRC informed before, Shanghai Chlor-Alkali is in plans to shut 720,000 dry mt/yearcaustic soda plant for maintenance in June 2013. It will remain off-stream for around one month.

Shanghai Chlor-Alkali Chemical Co., Ltd. manufactures and markets chlorine and alkaline chemicals. The Company's products include caustic soda, polyvinyl chloride, and other basic chemicals. Shanghai Chlor-Alkali Chemical also has operation in property development.
MRC

MOSCOW (MRC) -- SIBUR’sTreasury was awarded as Best Treasury of the Year at the Russian CFO Awards ceremony launched by the Adam Smith Institute (UK), according to the company's press release.

First held in 2012, the Russian CFO Awards seek to bring the best projects to the attention of the financial community and to honour the best professionals in the Russian financial sector. The Awards judging panel includes representatives of the Russian Economic School, the Higher School of Economics, the Federal Agency for State Property Management of the Russian Federation, the CFO-Russia magazine, and other research institutions and companies.

SIBUR’s Treasury was recognised by the experts for a number of projects and programmes it had implemented in the areas of capital raising, insurance, automation of treasury operations, and for its work with rating agencies.

"We would like to thank the financial community for recognition of our work. We believe this recognition to be a reflection of the company’s growth and investment potential and its strong financial position," said Pavel Ananienko, SIBUR’s Head of Treasury.

We remind that, as MRC informed earlier, in 2012, SIBUR productions facilities achieved a 22% year-on-year reduction in sanitary waste generation, a 5% reduction in waste water discharge, and a 3% reduction in air pollution. The company's total investment in environmental protection in 2012 under the corporate Dedicated Environmental Programmes reached RUB2.234 bln with the Company’s payments for the environmental impact reduced to .28.2mln (down by RUB7 mln).

SIBUR is the leading petrochemical company in Russia and Eastern Europe. The Company operates across the entire petrochemical process chain from gas processing to the production of monomers, plastics and synthetic rubbers, as well as the processing of plastics.
MRC

MOSCOW (MRC) -- LyondellBasell Industries' expansion plans for North America could include more than 1.2 billion pounds of new polyethylene capacity, said Plasticsnews.

At the firm's recent Investor Day event, officials described a new PE line with around 1 billion pounds of annual capacity as "possible," and also listed a 220 million pound PE debottleneck as a new project.

The new line would cost around USD200 million and would be operational in 2016, officials said. The debottleneck would cost about USD20 million and would come online next year. The firm - based in Rotterdam, the Netherlands, with North American headquarters in Houston — already had increased its PE capacity by 100 million pounds last year via a debottleneck at its plant in Morris, Ill.

LyondellBasell - one of the world's largest makers of PE and polypropylene — also is in the process of adding 800 million pounds of capacity for ethylene feedstock in La Porte, Texas. It has additionally announced plans to add 800 million pounds of ethylene capacity in Corpus Christi, Texas, and 250 million pounds in Channelview, Texas. The combined cost of those three projects will be more than USD900 million, but officials said they could create as much as USD700 million in potential growth value per year.

"The availability of abundant supplies of natural gas and natural gas liquids from shale deposits is creating a tremendous advantage for U.S. manufacturers," CEO Jim Gallogly said in a news release. "And LyondellBasell is well-positioned to seize this opportunity at our Gulf Coast and Midwest facilities."

In an April 22 phone interview, company spokesman David Harpole said that the firm "is looking at adding polyethylene capacity" in North America, but hasn't yet made a decision as to location or on the technology it would use. He added that the new ethylene capacity being brought on by LyondellBasell "is the equivalent of a new ethylene cracker," so adding new PE capacity "would be an opportunity to utilize some of (the new ethylene) internally, and the remainder would be a growth opportunity."

The firm now is the sixth PE maker to announce plans for new capacity in North America, joining Chevron Phillips Chemical Co. LP, Nova Chemicals Corp., Formosa Plastics Corp. USA, Dow Chemical Co. And ExxonMobil Chemical Co. The CP Chem, Formosa and ExxonMobil expansions would add almost 6 billion pounds of new capacity. No capacity numbers for the Dow and Nova projects have been released.

Outside of North America, LyondellBasell is increasing capacity for plastic feedstock butadiene by 40 percent at its plant in Wesseling, Germany. That project is expected to be completed later this year.

LyondellBasell posted record profit of more than USD2.8 billion in 2012 on sales of almost USD45.4 billion. Profit for 2012 was up 32% vs. 2011, while the sales number was down almost 6%.

The firm's olefins and polyolefins business in the Americas saw its 2012 pretax profit soar more than 38% vs. 2012, as the business benefited from geographically advantaged feedstocks.

As MRC wrote earlier, LyondellBasell announced that OAO Nizhnekamskneftekhim, the largest petrochemical company in Russia, has selected the company's Spheripol process technology for a new 400 KT per year single-line polypropylene (PP) plant to be built in Nizhnekamsk, Russia Federation.

MRC

MOSCOW (MRC) -- European producers have reduced export prices of polyethylene (PE) and polypropylene (PP) for CIS countries on the fall in contract prices of olefins and oil prices, according to ICIS-MRC Price Report.

April contract prices of ethylene and propylene in Europe were agreed by EUR50-60/tonne down from March level.
Low demand and a serious decline in feedstock costs have forced European producers to reduce export prices of polyolefins for CIS countries in the first half of April by EUR30-60/tonne, compared with the level in March.

But the drop in oil prices has caused further reduction in prices of PE and PP in the second half of April. The price of high-density polyethylene (HDPE) were cut most of all.

By mid-April European PE prices for CIS countries have been reduced by EUR40-60/tonne, from March level.
Deals for high-density polyethylene (HDPE) were concluded in the range of EUR1,170-1,230/tonne FCA. By the end of the month some companies managed to reduce prices HDPE prices to EUR1,040-1,070/tonne FCA.

European polypropylene prices fell on average by EUR20-40/tonne compared to the price of mid-March. Last week deals for homopolymer of propylene (homopolymer PP) were stricken in the range of EUR1,150-1,200/tonne FCA. Deals for copolymers of propylene were in the range of EUR1,220-1,280/tonne FCA. By the end of the month homopolymer PP prices have been settled at EUR1,140-1,180/tonne FCA.

Since early April, futures of Brent oil have decreased by 6%. Many market participants on falling crude prices expect contract prices of ethylene and propylene in May to be cut not less than in April, which results in further reduction of export prices of polyethylene and polypropylene for CIS countries.

MRC

MOSCOW (MRC) -- MRC news digest over the past week.

1. Russian market participants expect PS prices to decline.

Although the contract price of styrene monomer (SM) in Europe in April decreased by EUR64/tonne to EUR1,411/tonne, FOB ARA, Russian producers have not significantly changed their price quotation. Participants of the PS market are waiting for the price reductions from Russian producers due to the ongoing SM price cuts in Europe. Thus, in the beginning of April, spot prices of SM were at USD1,560-1, 580/tonne, and in the mid-April the price has fallen to USD1,530-1,540/tonne. Buyers of polystyrene in the Russian market on the back of sliding SM prices are waiting for the price adjustments from Russian producers.

2. PP imports to Ukraine in Q1 2013 grew twofold.

Ukraine's imports of polypropylene (PP) is rapidly growing on the back of the outage of local producer Linik. Thus, PP imports to Ukraine in Q1 2013 grew more than twofold, reaching 39,300 tonnes, from 19,000 tonnes in Q1 2012. March PP imports to Ukraine reached 14,600 tonnes, up 20% from February. March imports of homopolymer of polypropylene (PP-homo) to Ukraine amounted to about 11,400 tonnes, up 18% from February. The total import supplies of PP-homo in the first quarter of 2013 reached 31,700 tonnes, up 166% year on year. This year Ukrainian companies have significantly increased the imports of PP-homo from Saudi Arabia, India and the United States. The share of European producers has declined, the only exception made the material by Rompetrol production. Imports of block copolymers of propylene (PP-block) last month made 1,200 tonnes, which is almost equal to the February imports. Ukraine's imports of PP-block in the first quarter of this year made around 3,300 tonnes, up 10% year on year. In January - March 2013 imports of PP-random is very close to 3,000 tonnes, up 24% year on year. Only pipe producers increased their demand for PP-random in Q1, while other sectors, on the contrary, reduced it.

3. Output of products from polymers in Russia rose by 13% in Q1, 2013.

In the first quarter, Russian converters of polymers increased production of finished products by 12,8% year-on-year. The sector of sheets production accounted for the largest production volume, while, by contrast, the output of bottles, flasks and similar articles from polymers slumped by 14,8% to 3.13 billion items. However, the output of these products in March rose by nearly a quarter from February and reached the level of 1.24 billion items. The production of plates, non-porous sheets in March fell to 13,500 tonnes, while in February this index made 17,900 tonnes. In January-March, 2013, the total output of plates, non-porous sheets by Russian plants made about 51,000 tonnes, up 30% year-on-year. In the construction sector, plastic windows and window sills accounted for the largest increase in production volumes. According to Rosstat, last month the output of these products amounted to 1.6 million square metres, up 22% from February. Overall, in January-March this year, the production volume of plastic windows and window sills made 3.9 million square meters, an increase of 21% year-on-year. In March 2013, the output of doors and their polymer boxes reached 60,400 square metres, an increase of 26% from February. However, in January-March 2013, the total production volume of doors and polymer boxes grew by only 3,3% year-on-year. The production of plastic pipes and fittings in March rose to 47,200 tonnes, up 12% from February. Over the first three months of 2013, the total output of plastic pipes and fittings went up to 127,000 tonnes, up 6,4% year-on-year. Last month, the output of plates, polymer non-porous and non-reinforced films made about 70,900 tonnes, an increase of 9% compared to February. In January-March 2013, the total production volume of these products amounted to 183,000 tonnes, up 7,1% year-on-year.

4. Imports of PET to Ukraine grew by nearly 3% in Q1, 2013.

In the first quarter, 2013, Ukrainian companies increased their imports of PET granulate by 2,6% year-on-year. In January-March 2013, imports of PET to Ukraine for the production of PET preforms mades about 38,700 tonnes, nearly 1,000 tonnes more than last year. In 2012, imports of granulate amounted to about 37,800 tonnes. February accounted for the peak volumes of imports in the first quarter of the year. In February, total imports of PET made about 16,000 tonnes, while in March, the supply of granulate to the country amounted to about 14,300 tonnes.

5. Russian PET production in March rose by 20%.

In March, Russian producers increased the output of bottle polyethylene terephthalate (PET) granulate by 20% from February and reached 41,300 tonnes. Russian companies in March have produced 41,300 tonnes of PET granulate, up by 5,600 from February. The increase in production resulted from the increased capacity utilization of Alco-Naphtha, Kaliningrad, and a larger number of calendar days in the month. Sibur-PETF, Senezh and Polyef kept the same level of their capacity utilisation. For the Q1 2013 Russia's production of PET granulate made about 112,000 tonnes, which is slightly more than in the same period last year - 110,000 tonnes.

6. Asian PET prices fell following drop in feedstock prices.

Export prices of bottle PET granulate for CIF countries declined by USD10/tonne following the decline in the spot prices of paraxylene (PX), purified terephthalic acid (PTA) and monoethylene glycol (MEG). Asian PET granulate prices having recovered last week resumed their downtrend again on the back of the falling feedstock prices. PX price in China dropped by USD50/tonne, PTA prices were cut by USD27-29/tonne and spot quotations of MEG were at USD21-23/tonne lower than the week before. The future trend of PET prices is uncertain due to the falling prices of feedstock in the market. Buyers prefer to stay on the sideline.

7. Production of polyethylene in Russia rose by 9% in March.

In March, the output of polyethylene (PE) by Russian producers increased by 9% from February and reached 149,000 tonnes. In the first quarter of the year, the total production volumes made 436,000 tonnes. All Russian producers of high-density polyethylene (HDPE) reduced their level of capacity utilization with the exception of Gazprom neftekhim Salavat (its output grew to 5,900 tonnes). Nizhnekamskneftekhim accounts for the largest cut in the output - 9% compared to February (to 15,600 tonnes). In March, Kazanorgsintez and Stavrolen produced 43,000 tonnes and 24,400 tonnes, respectively. The overall output of HDPE in March amounted to 89,000 tonnes. In the first quarter of the year, the total production volume of HDPE by Russian producers made more than 266,000 tonnes, up 43% year-on-year. The March production volume of low-density polyethylene (LDPE) made 60,000 tonnes, up 16% from February. Last month, all Russian producers raised their volumes of LDPE production. Overall, in January-March, the total production of LDPE amounted to 169,700 tonnes, up 4% year-on-year. Linear polyethylene (LLDPE) was not produced in March.

8. Imports of titanium dioxide to Russia grew by half in March.

In March, imports of titanium dioxide (TiO2) to Russia increased by 53% year-on-year. Last month, the total supply volumes of the imported material to Russia amounted to 8,760 tonnes. All major suppliers of titanium dioxide to the country, such as Ukraine, the USA, China and Germany, accounted for the growth of import shipments. According to customs statistics, in March 2013, imports of TiO2 for the production of paints and varnishes made 6,460 tonnes. About 1,700 tonnes of specialized grades of TiO2 for the production of rigid compounds were imported. About 600 tonnes of titanium oxide were imported for the production of paper, building materials, household chemicals and for other segments of pigment consumption. In Q1 2013, imports of titanium dioxide to the Russian domestic market amounted to about 21,600 tonnes.

9. Ukrainian exports of titanium dioxide in March fell by 25%.

Ukraine's exports of titanium dioxide in March decreased by 24% year on year. On the back of weak consumer activity in foreign markets Ukrainian producers have reduced the sales of titanium dioxide. In March, export shipments of Ukrainian titanium dioxide fell by 3,500 tonnes as compared to March 2012, and amounted to about 11,000 tonnes. Compared with February 2013 exports declined by 1,16 tonnes. The exports fell due to the overproduction of the material in the world, which resulted in a decrease in spot prices of titanium dioxide. Ukraine's exports of titanium dioxide in Q1 2013 on the back of decline in foreign prices made 33,300 tonnes, from 38,000 tonnes in Q1 2012 - down 12% year on year. The increase in exports relative to the previous year was seen only in January and made only 340 tonnes, while in February and March, exports of TiO2 fell by 1,570 tonnes and 3,500 tonnes respectively.

10. Ukrainian imports of PE in Q1 2013 increased by 11%.

Ukraine's imports of polyethylene (PE) in Q1 2013 increased by 11% and made 83,500 tonnes, on the back of an increase in the demand due to the outage of Ukrainian Karpatneftekhim (Lukoil Group). March PE imports to Ukraine decreased by 3%, from February and made 25,600 tonnes. However, in January - March, the total imports of polyethylene to the Ukrainian market made 83,400 tonnes, up 11% year on year. Last month's imports of high density polyethylene (HDPE) to Ukraine decreased by 6% compared with February and made about 11,000 tonnes. The total imports of HDPE in Q1 2013 amounted to 33,800 tonnes, up 28% year on year. Imports of low-density polyethylene (LDPE), after the peak in January continued to decline, and in March was about 7,900 tonnes, due to large carryovers from the end of last year and weak demand for finished films from many sectors of consumption. In January - March of the current year, the total imports of LDPE to Ukraine made 29,600 tonnes, down 5% year on year. Linear polyethylene (LLDPE) is the only polyethylene, which shows a stable growth. March imports of LLDPE increased to 5,800 tonnes, up 20% from February. In Q1 2013 LLDPE imports by increased by 15% to 17,200 tonnes. The main increase in consumption provided the producers of multilayer films. Import of other polymers of ethylene in the first quarter of 2013 remained practically at the level of the first quarter of 2012 and made a little more than 1,000 tonnes.

11. Production of caustic soda in Russia surged by 9% in March.

In March, the total output of caustic soda by Russian plants increased by 9% from February. Because of the large number of calendar days in March compared to February, the final production volumes of domestic plants rose by 8,100 tonnes and made about 95,000 tonnes last month. Meanwhile, an average capacity utilization of Russian caustic soda producers remained unchanged. The share of Kaustik (Volgograd) accounted for 20% of Russia's production of caustic soda. Last month, Sayanskkhimplast and Kaustik (Sterlitamak) produced 18% and 16% of the total production volumes of the material, respectively. Overall, in Q1 2013, the output of caustic soda by Russian plants amounted to 276,400 tonnes. The production of caustic soda in Russia remains stable year-on-year. Thus, in the first quarter of 2012, Russia produced 276,300 tonnes of caustic soda.

12. PET consumption in Russia rose by 4% in March.

In March, consumption of polyethylene terephthalate (PET) in Russia increased by 4% from February to 52,500 tonnes. In the Russian PET market, a seasonal increase in market players' activity contributes to the growth of the estimated consumption of the material. Amid rising demand, domestic plants have raised their production of granulate. Overall, in March, PET production in Russia surged by 20% from February and made 41,300 tonnes. In March, imports of PET to Russia amounted to about 14,700 tonnes, whereas in the previous month this index equalled 16,000 tonnes. In January-March, the estimated rate of consumption of the material in Russia increased by 5% or 6,500 tonnes year-on-year. In the first quarter of the year, the final consumption volumes made 146,000 tonnes. In 2012, the peak indices for the estimated PET consumption by Russian companies accounted for June. Thus, in June 2012, domestic converters consumed about 59,000 tonnes of the material.

13. Russian DOP will go up in value in May.

In April, the planned outage for maintenance at Salavat plant and a growing seasonal demand led to a serious increase in prices of DOP plasticizer in the Russian market. In early April, the increasing cost of 2-ethylhexanol resulted in rise in prices of DOP plasticizer in the Russian spot market by Rb3,000/tonne to the level of Rb70,000-72,000/tonne, including VAT and delivery. Since 20 April, Gazprom Neftekhim Salavat has shut its DOP production for a monthly turnaround. As a result, in the last week of April, the plasticizer prices reached the level of Rb72,000-75,000/tonne, including VAT and delivery, in the spot market. Russian producers do not exclude further increases of DOP prices in May on a continuing rise in feedstock prices and limited supply. Price offers for June shipments of South Korean DOP were voiced in the range of USD77,000-79,000/tonne, including VAT and delivery.

14. Investments in PVC processing in 2012 decreased by 21%.

In 2012, the investments in processing of PVC made USD74.3 mln, down 21% from 2011, when investments rose sharply after two-years fall in investments. Investments in PVC processing in 2008 was 2.5 times higher than in 2012. In 2012 there were installed 436 production lines with total capacity of PVC processing about 450,000 tonnes/year, down almost 21% from 2011. The investments in the largest sector of PVC processing - extrusion profile-moulding products (PMP), which in 2004-2012 made more than 50% of the total investment in the processing of PVC, gradually slow down compared to to the pre-crisis period with average annual growth of investments about 30%, is now being close to saturation. The capacities of PMP production in 2012 amounted to 147,000 tonnes, down 19% compared to 2011, while in 2008 this figure was 435,000 tonnes. Total investments in equipment for the production of PMP made USD36 mln, down 19% from 2011 and more than two times less than in the record 2008. The largest share of investments in the sector PMP (more than USD20 mln) was provided by the sector of window profiles. At the same time, growth in PVC processing by cable extrusion almost doubled - to 41,000 tonnes (74 production lines), which is more than twice less than the capacities of imported lines in 2008.
MRC