S Korean petrochemical exports to China on continuous decline

MOSCOW (MRC) -- South Korea’s petrochemical exports to China declined further in 2015 on China’s increased self-sufficiency rates for petrochemical products, said TPS with reference to a report released by the Export-Import Bank of Korea (Korea EXIM Bank).

According to the EXIM Bank, South Korea’s petrochemical exports to China were estimated to be at USD14.42 billion from January to October 2015.

China remained as the largest recipient of petrochemical products from South Korea, accounting for 45.10% of total petrochemical exports from South Korea.

However, this is a slight decrease from 2014 when petrochemical exports to China accounted for 45.70%.

Indeed, South Korea’s petrochemical exports to China have been on the continuous decline since 2010 when it accounted for nearly 48% of total exports.

In recent years, China’s petrochemical production capacity has increased significantly in tandem with the Chinese government’s efforts to boost self-sufficiency rates for its burgeoning petrochemical sector.

Consequently, it is estimated that China’s self-sufficiency rates for petrochemical products, mainly synthetic resins, synthetic fibre and synthetic rubber materials had reached nearly 80% in 2014, a sharp increase of 14.20% from 2010.

In particular, self-sufficiency rates for purified terephthalic acid (PTA) and polyethylene terephthalate (PET) are estimated to have reached 103% and 106% respectively in 2015.

This has translated into the plunge in South Korea’s PTA exports to China which declined by 88% on year.

Other products that have registered a sharp fall in exports to China in 2015 were benzene derivatives such as caprolactam and phenol which plunged by 65% and 64% on year respectively.

Looking ahead, the EXIM Bank forecasted that South Korea’s petrochemical exports to China will continue decline as further capacity expansions for coal-based plants are expected in China for the next five years.

In addition, weakened demand for petrochemical products due to the slowdown of the Chinese economy and increased competition from the Middle East producers will also reduce South Korea’s petrochemical exports to China.

We remind that, as MRC reported earlier, in August 2015, The Ministry of Commerce, Government of China announced it would review anti-dumping duties on PTA imported from South Korea and . Anti-dumping duties ranging between 2 and 20.1% were imposed on PTA imports from these two countries in August 2010, for a period of five years. The ministry's decision to review these duties follows an application made by domestic producers in June 2015 requesting the ministry to reinvestigate the case and extend the duties which are due to expire.
MRC

Nippon steel plans maintenance at No. 3 SM plants

MOSCOW (MRC) -- Nippon Steel Chemical Company (NSCC) is in plans to shut its No.3 styrene monomer (SM) plant, as per Apic-online.

A Polymerupdate source in Japan informed that the company has scheduled maintenance at its No. 3 plant in end-March 2016. The plant is slated to remain offline for around one month.

Located in Oita, Japan, the No. 3 SM plant has a production capacity of 230,000 mt/year.

As MRC wrote before, in September 2015, NSCC announced its plans to shut its SM for maintenance. The plant was planned to remain off-stream for around one month. Located in Oita, Japan, the plant has a production capacity of 190,000 mt/year.

Idemtisu Kosan Co, Asahi Kasei Chemical and Taiyo Petrochemical are the other SM producers in Japan.
MRC

Asahi Glass begins shipping chlor-alkalis from expanded Indonesian complex

MOSCOW (MRC) -- Asahi Glass has begun shipping polyvinyl chloride (PVC) from the Anyer plant at Cilegon, Indonesia, following completion of an expansion program at PT Asahimas Chemical, said the producer on its site.

The ceremony also included a ground breaking for a new power plant at the site. Commercial production at the expanded chlor-alkali facility will start in the first quarter this year. PT Asahimas Chemical is owned 52.5% by Asahi Glass, 11.5% by Mitsubishi Corp. and 18% each by the local Rodamas and Ableman Finance.

With the aim of taking in the increasing demand in the caustic soda and polyvinyl chloride (PVC) markets in Southeast Asia, the production facility enhancement at the Anyer Plant was launched in 2013 to significantly boost the output of caustic soda and vinyl chloride in Indonesia.

The caustic soda and polyvinyl chloride (PVC) markets in Southeast Asia are projected to grow at over 5% per year. Of the demand in the market, Indonesia, Thailand and Vietnam, where AGC has production bases for the chlor-alkali business, account for 70%.

As MRC informed earlier, Asahi Glass Co Ltd (AGC) in March 2015 announced that it would increase the production capacity of the polyvinyl chloride (PVC) facility at Phu My Plastics & Chemicals Co Ltd (PMPC), AGC’s subsidiary engaged in PVC business in Vietnam. PMPC’s PVC production capacity will be increased by 50% to 150,000 tonnes from the current 100,000 tonnes per year, which will make the Asahi Glass Group’s total PVC production in Southeast Asia 700,000 tonnes per year. The operation is scheduled to commence at the beginning of 2016.

Asahi Glass Co., Ltd., more commonly known as AGC, is a global glass manufacturing company, headquartered in Tokyo. It is one of the core Mitsubishi companies.
MRC

Saudi Kayan awards USD95 mln contract to Taiwanese CTCI

MOSCOW (MRC) -- Saudi Kayan Petrochemical Co. has awarded Taiwan's CTCI Corp. a contract worth USD94.5 million (SAR 354.4 million) to build a new cracker at its complex in Jubail Industrial City, said Argaam.

Under the deal, CTCI will manage the engineering, procurement and construction management (EPCM) for the project, which is located in the Eastern Province of Saudi Arabia.

The company added that it will secure the related finance from local institutions, expecting to complete the new cracker in H2-2017.

The date of trial operation and the expected financial impact will be announced later.

The new cracker comes as part of Kayan’s agreement, which was signed on February 5, 2015, with the Ministry of Petroleum and Mineral Resources and Saudi Basic Industries Corp. (SABIC) to enhance the company’s business and financial performance in return for extra ethane gas allocations.

As it was informed earlier, Saudi Kayan reported a net loss of 624.1 million riyals (USD166.3 million) in the fourth quarter, the fourth straight quarter it failed to achieve a profit, hurt by product prices that have tumbled along with feedstock oil.

Kayan is 35 percent-owned by SABIC. Kayan is the fifth-largest petrochemical manufacturer by market value in Saudi Arabia.
MRC

PE and PP prices resumed to rise in Ukraine

Moscow (MRC) - Prices for polyethylene (PE) and polypropylene (PP) sharply decreased in Ukraine in the beginning of the year, but since the end of last week prices started to rise. Devaluation of the national currency is the main reason for rise in price of polymers, according to ICIS-MRC Price Report.

In the early January PE and PP prices in the Ukrainian market began to decline rapidly. The price cuts resulted from the cancellation of a 5% temporary import duty and lower prices in foreign markets. PE and PP prices continued to go down in foreign markets in February, but the weakening of the national currency against the US dollar offset this factor, and prices on the contrary increased at the end of last week.

In the early January 2016 the exchange rate of hryvnya against the dollar fell below UAH24=USD1, but in the second half of January the devaluation of the Ukrainian currency has accelerated. By mid-February, the official hryvnya exchange rate to the dollar exceeded the level of UAH26=USD1. Thus, almost a month devaluation was more than 9%.

Such a serious devaluation in a short period has offset the reduction of PE and PP prices in the external markets.
In January - February polyolefins prices in Europe fell by EUR100-160/tonne. Prices for Middle Eastern PE reduced on average by USD150/tonne.

Late January's price offers for film high density polyethylene (HDPE) and low density polyethylene (LDPE) in the Ukrainian market reached the level of UAH39,000-40,500/tonne FCA, including VAT and UAH36,500-38,000/tonne FCA, including VAT, respectively.

Price offers for homopolymer PP raffia grade were heard in the range of USD33,500-34,500/tonne FCA, including VAT. But at the end of last week (11, February) traders under the pressure of the weakening of the national currency started to raise prices.

Price offers for film HDPE from some traders started from UAH41,000/tonne FCA, including VAT, price offers for LDPE were absent.

It is highly probable that price adjustment will continue this week in the Ukrainian market on the ongoing devaluation of the national currency.
MRC