Moodys downgrades DuPont ratings

MOSCOW (MRC) -- Moody's Investors Service downgraded the long term issuer and senior unsecured ratings of E.I. du Pont de Nemours and Company's (DuPont) to A3 from A2, as per Moody's statement.

The commercial paper rating was also downgraded to Prime-2 from Prime-1. The outlook is stable. The downgrade reflects the extended period of strained metrics for the previous rating categories, and recognizes that shareholder pressures and operational headwinds are likely to impede a near-to-medium term resurgence in metrics to levels that are commensurate with the higher rating. This downgrade concludes the review which commenced on January 24, 2015.

"The downgrade reflects a sustained period where DuPont's metrics have not been supportive of A2 ratings, while its portfolio is being downsized through divestitures where most or all of the proceeds have gone (or will go) to shareholders," said Joseph Princiotta, VP - Senior Analyst and lead analyst for DuPont. "The recent proxy contest with Trian might be over, but we expect shareholder pressures on management to be the new normal."

DuPont's A3 ratings reflect its standing as a leading science and technology company with a business profile that is supported by product and geographic diversity, leading market shares and the specialty nature of many of its products. The ratings are also supported by a strong competitive position in agricultural products, DuPont's largest segment, which includes a robust development pipeline in new insect control and triple stack seed traits that strengthen its position in this growing but highly competitive and dynamic marketplace.

DuPont is one of the largest chemical producers and benefits from economies of scale. The company has diverse global operations serving a broad customer base in many end markets. Some of DuPont's well-known brands include Pioneer, Tyvek, Corian, Kevlar, Ti Pure, Teflon and Opteon (the latter three soon to be separated with Chemours).Headquartered in Wilmington, Delaware, E.I. du Pont de Nemours and Company (DuPont) is one of the largest US and global chemical companies with a diverse portfolio of specialty materials, chemicals, polymers and agricultural products. The company reported USD33.7 billion of revenues for the twelve months ending March 31, 2015.
MRC

MOSCOW (MRC) -- May prices of low density polyethylene (LDPE) began to drop gradually in the Russian market after a record in April. Supply of polymer has been gradually increasing, but, at the same time, large deferred demand remained, according to ICIS-MRC Price report.

The Russian LLDPE market faced an acute shortage in April, which was caused by a scheduled shutdown for maintenance at Kazanorgsintez, Russia' second-largest producer. As a result, prices reached record levels. May brought a considerable reduction in prices, especially, in the second half of the month. At the same time, deferred demand for LDPE was still great, which will slow down a further price fall.

The April deficit of LDPE in the Russian market led to price increases of up to Rb105,000/tonne FCA, including VAT, and higher. Some of converters could not bear such a high price level and limited their purchasing by Rb100,000/tonne FCA, including VAT. Someone still had to buy material at higher prices because of commitments to their customers.

After long May holidays, prices started to roll back gradually in the market. Kazanorgsintez resumed its LDPE production after maintenance in the middle of the month, but becuase of technical issues, the plant was not able to reach full capacity utilisation for a long time, and polyethylene (PE) shipments to the domestic market were resumed after a long delay.

Prices of many LDPE grades had gone down to Rb90,000/tonne FCA, including VAT, and lower. PE supply has been gradually increasing in the market, but the market is still far from saturation, and producer's stocks are virtually absent. The great deferred demand and a slow saturation of the market are most likely to still limit the price reduction in the near future.
MRC

MOSCOW (MRC) -- Celanese Corporation, a global technology and specialty materials company, will increase list and off-list selling prices for acetic acid and acetic anhydride in view of the recent rapid increase and continued volatility in China methanol prices, said the producer on its site.

The price increases below will be effective immediately, or as contracts allow:

- acetic acid - RMB 100 per tonne;
- acetic anhydride - RMB 100 per tonne.

As MRC informed previously, Celanese Corporation raised list and off-list selling prices for vinyl acetate monomer (VAM), effective June 1, 2015, or as contracts allow. Thus, the company's VAM prices were increased by EUR 75/tonne for Europe and Middle East and by USD30/tonne for Asia (outside China).

Besides, in mid-May 2015, Celanese also increased list and off-list selling prices for acetic acid in view of the recent rapid increase and continued volatility in China methanol prices. The following price increase was effective immediately, or as contracts allow: RMB150/tonne for China.

Celanese Corporation is a global technology leader in the production of differentiated chemistry solutions and specialty materials used in most major industries and consumer applications. Based in Dallas, Texas, Celanese employs approximately 7,500 employees worldwide and had 2014 net sales of USD6.8 billion.
MRC

MOSCOW (MRC) -- The Rhein Chemie Additives business unit (BU ADD) Lipetsk site, which has been manufacturing rubber additives since mid-2013, has successfully received ISO 9.001 and 14.001 certificate after passing the outstanding audit by the external auditors, as per the company's press release.

The plant was built in a green area in Lipetsk Industrial Park, about 500 km southeast of Moscow. It was clear that lasting commercial success with local tire and rubber industry customers in Russia could not be achieved without ISO 9.001 (quality management) and ISO 14.001 (environmental management) certification. BU ADD therefore started a support program in early 2014 to enable the new site, the first Lanxess production site in Russia, to be incorporated into the group master certificate as rapidly as possible.

After a kick-off event in January 2014, two HSEQ workshops were held in April and June 2014 with the aim of expanding the existing OOO LANXESS management system in Moscow to the production site in Lipetsk.

A commercial workshop in October 2014 and an HSE workshop in March 2015 rounded out the support program and enabled the highly-motivated team on site to build and integrate the systems and processes to the group level.

The results are impressive: The audit, carried out by external auditor DQS, passed with no deviations and only a few recommendations.

"The construction and control of the processes in the triangle between Moscow, Lipetsk and BU Central in Germany were a special challenge. The existing management system at OOO LANXESS cooperated with us excellently. Many thanks to all involved," said Karl-Heinz Muller, Production Manager of the Rubber Business Line of BU ADD.

As MRC reported earlier, in early July 2013, German specialty chemicals company Lanxess celebrated the opening of its first production facility in Russia. In the new plant at the Lipetsk site, Lanxess subsidiary Rhein Chemie manufactures polymer-bound rubber additives for the markets in Russia and the Commonwealth of Independent States (CIS), primarily for the automotive and tire industries. A production facility for the bladders used in tire production is to be added in 2016. The overall investment volume in euros amounts to a seven-digit figure and 40 new jobs will be created at the new plant in the medium term.

Lanxess is a leading specialty chemicals company with sales of EUR 8.0 billion in 2014 and about 16,600 employees in 29 countries. The company is currently represented at 52 production sites worldwide. The core business of Lanxess is the development, manufacturing and marketing of plastics, rubber, intermediates and specialty chemicals.
MRC

MOSCOW (MRC) -- Heilongjiang Haohua has restarted a polyvinyl chloride (PVC) plant following maintenance turnaround, reported Apic-online.

A Polymerupdate source in China informed that the plant restarted on May 24, 2015. It was shut on May 10, 2015.

Located in Heilongjiang province, China, the plant has a production capacity of 300,000 mt/year.

As MRC wrote before, Yibin Tianyuan shut its PVC plant for maintenance turnaround on April 15, 2015. It remained off-stream for around one month. Located in Sichuan province, China, the plant has a production capacity of 380,000 mt/year.

We also remind that Henan Shenma Chlorine Alkali is not in plans to undertake a maintenance turnaround at its PVC plant in 2015. A Polymerupdate source in China informed that the plant is likely to undergo a maintenance turnaround in 2016, though a specific schedule for the same has not been worked out. Located at Henan in China, the plant has a production capacity of 450,000 mt/year.
MRC