INEOS restarting Chocolate Bayou cracker

(Plastemart) -- INEOS has embarked on restarting one of its Chocolate Bayou crackers in Texas, which were downed by lightning on 1 November. Outage at this plant triggered a significant rally in ethylene spot prices, as per ICIS. With two steam crackers in Chocolate Bayou, INEOS has a combined ethylene capacity of 1.8 mln tpa.

Olefins 1, with 907,000 tpa ethylene capacity is being restarted. The second cracker is unlikely to restart until mid-December.

The outage at Chocolate Bayou triggered a 27% surge in US ethylene spot prices, which had already been rising as a result of planned and unplanned shutdowns at four other units in prior weeks. Ethylene for November soared to US$1146/ton after the INEOS shutdown, rising from a deal done at 41 cents/lb only a couple of days before the outages.

Last week saw additional gains in ethylene on news of an extended outage at a Louisiana cracker. November ethylene traded as high as 53.50 cents/lb on 9 November, its highest level since the last week of April.


LyondellBasell will keep US BD on allocation in December

(ICIS) -- LyondellBasell plans to keep US butadiene (BD) on allocation in December amid continued strong demand for the product, the company said on Friday in a letter sent to customers. The restriction was set at 85%, compared with 90% in November.

LyondellBasell last week rescinded its force majeure (FM) on BD, which had been in place since 18 May following mechanical problems at its Channelview extraction unit in Texas. The company said those problems were corrected during planned maintenance in October.

But LyondellBasell said BD demand for December was well above historical norms, adding that for that reason it was unable to meet 100% of its customers' needs. The company also has two steam crackers in Channelview, each with 873,000 tonnes/year of capacity.


Europe PE buyers unable to obtain lower prices in November

(ICIS) -- Polyethylene (PE) buyers in Europe have been unable to obtain lower prices from producers in November as a result of smaller-than-expected amounts of imported material amid lacklustre demand and a flat market, sources said on Friday.

PE buyers had faced price increases of around ┬30/tonne in November, an amount that would cover the ┬28/tonne increase in the monthly ethylene contract price, which now stood at ┬978/tonne FD (free delivered) NWE (northwest Europe).

Buyers of low density polyethylene (LDPE) were under even more pressure, as producers aim to raise prices next month. On 18 November, Dow Chemical announced a ┬70/tonne increase for December PE. The US-based chemical major was making it clear that it was looking to cover what it saw as its increased costs in PE.

Producers of LDPE and linear low density polyethylene (LLDPE) reported strong demand this month, and Dow said that it had already closed its order books for November.


Honam Petrochemical looking to PET

(Korea JoongAng Daily) -- Honam Petrochemical, an affiliate of the Lotte Group, decided on Nov.19 to set foot in the polyethylene terephthalate (PET) film business as a part of its expansion strategy in the performance material business.

Honam said it will build a production facility within KP Chemical's site in Ulsan, which will be able to annually produce of 20,000 tons by 2012 and 40,000 tons by 2014.

Because Honam is the leading polyethylene producer in the Asian region and is ranked second in Asia for ethylene and polypropylene productions, its entry into the PET film industry will be a positive entry for its future task of becoming a ⌠total solution provider, but not so easy considering other competitors making a name in the market.


Bayer plans to cut workforce to save ┬800m/year

(ICIS) -- Bayer plans to reduce its workforce by 2,000 by 2012 as part of an ┬800m/year ($1.1bn/year) cost-cutting programme, the chief executive of the German pharmaceuticals and specialty chemicals producer said on Thursday.

The programme aims to shift the company's focus toward researching, developing and marketing new products in its pharmaceuticals and pesticides businesses, as well as expanding activities in emerging markets, Bayer said.

Bayer said about 4,500 positions - including 1,700 in Germany - would be cut, while 2,500 new jobs would be added, mostly in emerging markets. The company did not specify from which units that jobs would be cut.

The ┬800m/year in savings would be realised beginning in 2013.