Bayer MaterialScience wraps up major investment in Germany

MOSCOW (MRC) -- Bayer MaterialScience has successfully concluded a major capital expenditure project in Germany, said the company in its press release.

The company brought an ultra-efficient and resource-conserving world-scale plant for the production of the chemical TDI, a main component in high-quality foams, on stream at its site in Dormagen, located in the state of North Rhine-Westphalia.

Valued at some EUR250 million, the high-tech plant was inaugurated at a ceremony attended by representatives from politics, industry, public administration authorities and the local community.

Including infrastructure and supplier costs, total capital expenditure at Chempark Dormagen amounts to more than EUR 400 million. The site is to become Bayer MaterialScience’s European center for TDI production. Under construction for 30 months, the new plant replaces a smaller production unit for toluene diisocyanate (TDI). The chemical is used in the production of flexible polyurethane foams, which is used to produce many everyday articles including mattresses, car seats and upholstered furniture. Demand for TDI is expected to continue growing steadily worldwide in the years ahead.

Hannelore Kraft, governor of North Rhine-Westphalia, said at the inauguration ceremony, "The investment clearly illustrates the capability of Bayer's Dormagen site. But it is also an important signal about the international competitiveness of North Rhine-Westphalia as a center of the chemical industry." She added that the fact that Bayer also sent clear signals with respect to environmental protection is the way of the future. Another key factor for the success of the local chemical industry besides the funding of training and education is the strengthening of public acceptance. "Bayer did an exemplary job in terms of local public involvement."

As MRC wrote before, Bayer MaterialScience (BMS) plans to invest EUR 15 million in the construction of a production line at its Dormagen site, which will use CO2 to produce a precursor for premium polyurethane foam. The line will have an annual production capacity of 5,000 metric tons.

With 2013 sales of EUR 11.2 billion, Bayer MaterialScience is among the world’s largest polymer companies. Business activities are focused on the manufacture of high-tech polymer materials and the development of innovative solutions for products used in many areas of daily life. The main segments served are the automotive, electrical and electronics, construction and the sports and leisure industries. At the end of 2013, Bayer MaterialScience had 30 production sites and employed approximately 14,300 people around the globe. Bayer MaterialScience is a Bayer Group company.
MRC

MOSCOW (MRC) -- To offer customers in the United States and Canada greater availability of specialty styrenic materials, Styrolution, the global leader in styrenics, is expanding its distribution arrangements with PolyOne and Entec Polymers, reported the company on its site.

Moving forward, both companies will now offer Styrolution's full portfolio of specialty products. PolyOne and Entec Polymers were selected for expanded relationships based on their best-in-class customer support with regards to technical, industry and market segment expertise, service, logistical capabilities and geographical competencies. These distribution channels will provide significant value to customers in both the healthcare and automotive industries due to both companies' proven expertise in these industry segments.

Resulting from the expansion, PolyOne will now add to their line of specialty polymers Luran (SAN), Terlux (transparent ABS), Novodur (specialty ABS), Luran S (ASA), Styrolux (SBC) and Styroflex (SBC). These products complete PolyOne's existing portfolio of Styrolution products, which also includes Styrolution's full range of transparent styrenic polymers and polystyrene. Additionally, Entec Polymers will also offer the full range of Styrolution's specialty polymers by enhancing its transparent styrenic offerings with the additions of Zylar (MBS), NAS (SMMA) and Clearblend (MBS).

These expanded distribution relationships come shortly after the company's recent announcement of new transparent grades, Zylar 670 and Clearblend 155, which are also available through PolyOne and Entec Polymers.

The expanded distribution network advances the goals of Styrolution's "Triple Shift" growth strategy, which calls for a focus on styrenic specialties and ABS Standard, higher-growth industries and growth in emerging markets. Through these expanded relationships and by leveraging the deep industry-specific expertise of PolyOne and Entec Polymers, Styrolution continues to elevate its specialties product lines while providing customers with the support and insights necessary to develop market-leading applications.

Bill Bryant, Director of Sales, Styrenic Specialties & Distribution, Styrolution: "We are committed to providing our customers around the world and especially in North America, with the material solutions necessary to address their application requirements, no matter the industry. This includes working with distributors with a reputation and legacy of best-in-class customer and technical support, and industry expertise. As such, we are pleased to expand our distribution network with proven and experienced companies like PolyOne and Entec Polymers to offer our customers greater access to the materials and insights they need for success."

As MRC wrote before, in February 2014, in order to further strengthen its polystyrene (PS) business in North America, Styrolution announced it plans to consolidate PS capacity in the region. In addition, Styrolution will accelerate growth in styrenic specialties through an expansion of its offering for high-performance transparent styrenics, by providing local supply in Europe, the Middle East and Africa (EMEA). Part of Styrolution's Triple Shift growth strategy, these measures will further enhance the company's position as the global leader in styrenics.

The Styrolution Group GmbH is a global provider of styrenics , headquartered in Frankfurt am Main. The company is a joint venture between BASF (50%) and INEOS (50%), were merged into the main styrene operations of the two partners. Its main focus is on the production of monomer, polystyrene, styrenic specialties, and ABS. The company offers styrene plastics for a variety of everyday products from different industries, such as automotive, electronics, construction, household, leisure, packaging, medicine and health. In 2013, the company's sales were at EUR5.8 billion, resulting in an EBITDA before special items of EUR442 million. Styrolution employs approximately 3,200 people and operates 17 production sites in ten countries.
MRC

MOSCOW (MRC) - Russia's imports of polypropylene (PP) decreased by 19% in the first eleven months of this year. Decrease in imports largely resulted from the growth of its own PP production, but in recent months the pressure on import put the sharp devaluation of the national currency, according to MRC DataScope.

Russia's PP imports increased to 9,900 tonnes in November, from 13,400 tonnes in October. Total PP imports in Russia decreased to 157,400 tonnes in January - November 2014, compared with 195,100 tonnes year on year.

Significant increase in the production volumes (up 20%) reduced the dependence of the Russian market of homopolymer PP (down 34%).
Devaluation of the rouble led to a reduction in demand for imported propylene copolymers.

PP imports in Russia over the reported period looked as follows.

November imports of homopolymer PP to Russia decreased to 2,700 tonnes, compared with 3,500 tonnes in October because of the reduced supplies of Turkmenistan raffia. Total imports of homopolymer PP into Russia were 51,000 tonnes in the first eleven months of this year, down 34% year on year.

November imports of PP block copolymer reduced to 2,100 tonnes, from 3,600 tonnes in October) on the back of the seasonal factor and price rise for imported material. Total imports of block copolymers of propylene into Russia decreased to 41,000 tonnes in the first eleven months of the year, compared with 50,900 tonnes year on year, with the largest reduction in demand occurred for the pipe producers.

Imports of PP random copolymers into Russia were 2,800 tonnes in November, compared with 3,600 tonnes in October because of weaker demand for BOPP films. Total imports of PP random copolymers into Russia decreased to 32,100 tonnes in January - November, compared with 36,000 tonnes year on year.

The main drop in demand occurred for injection moulding (down 21%) and extrusion grades (down 36%), while the demand for the copolymers from the producers of BOPP films increased by 8%.

Imports of other PP grades grew to 33,300 tonnes in the first eleven months of the year, compared with 30,400 tonnes.


MRC

MOSCOW (MRC) - Importers of polyethylene terephthalate (PET) in the CIS countries reported a price drop for Chinese bottle grade PET.
This week the price for PET chips fell below psychological level of USD1,000/tonne FOB China, according to ICIS-MRC Price Report.

On Tuesday, 16, December export quotations for Asian PET were heard in the range of USD980-1,010/tonne FOB China, excluding VAT.
Buying activity remains weak on a bearish market. Prices for PET have been falling in line with decline in the feedstock prices.

Producers of terephthalic acid (PTA) in China have reduced capacity utilisation in an attempt to keep prices from further decline. At the same time, falling prices of paraxylene will force producers of PTA to make concessions to buyers (PET producers).

Paraxylene prices have dropped below USD900/tonne CFR China last week. However, though margins in the production of paraxylene narrowed, but remains high. The difference between the prices of paraxylene and naphtha in Asia last week reached USD350/tonne.

Producers of paraxylene will go on further price cuts amid falling oil quotations, which affects PET prices. According to MRC Price Forecast report, PET prices in roubles in the Russian market will continue upward trend in December 2014 and January 2015.

Importers have received cheapening PET in dollar terms (coming to the market with a delay of 45-50 days). However, the rate of national currency are falling, ahead of price reductions for PET chips in Asia, leading to an increase in the cost of procurement.

Russian PET prices are far from the parity to Asian prices (considerably lower). Local plants will continues to raise prices in 2015.


MRC

MOSCOW (MRC) -- Imports of high density polyethylene (HDPE) to the Russian market rose by 3% over the first eleven months of 2014. September, a month of shutdowns for maintenance at Tatarstan plants, accounted for the peak imports, after which imports began gradually to decline, according to MRC DataScope report.

September accounted for the peak HDPE imports, when Tatarstan producers - Kazanorgsintez and Nizhnekamskneftekhim - shut down their production for scheduled maintenance works. Imports began to decrease since October and totalled just over 21,000 tonnes in November (28,600 tonnes in October). The overall imports of this polyethylene (PE) grade to Russia increased to 275,500 tonnes from January to November 2014 versus 266,900 tonnes a year earlier. Extrusion blow moulding HDPE accounted for the largest increase in imports.

The supply structure by consumption sectors looks the following way over the stated period.

Last month's pipe grade HDPE imports fell to 5,200 tonnes under the pressure of seasonal factors from 7,400 tonnes in October. The overall imports of pipe grade PE to Russia totalled 78,800 tonnes over the first eleven months of 2014, up by 23% year on year.

November imports of HDPE for extrusion coating of large-diameter steel pipes virtually remained at the level of October and totalled 5,500 tonnes. PE shipments into this processing sector decreased by 20% over the said period and reached 54,400 tonnes. Lower imports of this HDPE grade were caused by the increased domestic production among other reasons (Metakley launched a similar PE production in the middle of 2014). Nizhnekamskneftekhim also intends to enter this segment.

Last month's imports of blow moulding HDPE fell almost two-fold in comparison with October and were 3,300 tonnes. The fall in imports was caused by both seasonal factors and increased shipments of Russian producers, particularly, of Kazanorgsintez. The overall imports of this PE grade surged by 40% from January to November 2014 to 49,300 tonnes.

November imports of injection moulding HDPE remained at the level of October and were 3,600 tonnes. Imports of this HDPE grade to Russia rose by only 3% over the first eleven months of the year and totalled about 43,000 tonnes.

September accounted for the peak film grade HDPE imports - 7,800 tonnes, and then shipments began to rapidly decline. Last month's figure dropped to 2,000 tonnes (4,600 tonnes in October). Film grade PE imports were 36,800 tonnes over the said period, down by 15% year on year.

HDPE imports to other sectors of consumption (cable extrusion, rotational moulding, etc.) dropped to 13,000 tonnes from 14,800 tonnes a year earlier.

MRC