Sumitomo Chemical announces business plan, looking at M&A in specialty chemicals

MOSCOW (MRC) -- Sumitomo Chemical has announced its new corporate business plan for until the fiscal year ending 31 March 2019 (fiscal 2018), said the company on its site.

This will, among other things see about EUR3.2 million allocated for the investments planned on a sector-by-sector basis and EUR2.4 billion set aside for investment in strategic M&A activity, as the company seeks large-scale investment opportunities in the speciality chemicals. Resources will be focused on the environment and energy, life sciences information and communication technology sectors, where the company is already strong.

This initiative, to ‘further improve business portfolio’, is one of three major items of basic policy in the plan, alongside others to generate more cash flow and accelerate the launch of next-generation businesses. By 2018, it aims to have increased net sales by 12.9% to EUR20 billion, operating income by 29% to EUR1.6 billion and net income by 37.5% to EUR870 million.

As MRC reported earlier, in May 2015, Sumitomo Chemical Co. announced its plans to mothball the ageing 415,000 tpa naphtha cracker at its Chiba plant from May 11. Though Sumitomo Chemical's cracker is shut for good, the company resumed operations of downstream petrochemical units at the Chiba plant from the beginning of July, using petrochemical feedstock from Keiyo Ethylene's 768,000 tpy cracker located nearby.

Sumitomo Chemical is a Japanese based manufacturer of a diverse range of products, including basic chemicals, petrochemicals and plastics, fine chemicals, agricultural chemicals, IT-related chemicals and pharmaceuticals.
MRC

MOSCOW (MRC) -- Evonik has launched an additional production area and erected a new building to house research, development, and scale-up operations for fixed bed catalysts at its Marl site, where it has been manufacturing catalysts for the past 75 years, said the company on its site.

The specialty-chemicals group has made a low double-digit million euro investment to expand its existing production capacities and erect a new building for operations revolving around the continued improvement of fixed-bed catalysts.

Explaining the investment, Johannes Ohmer, member of the Board of Management of Evonik Resource Efficiency GmbH, said, "Innovations and constant product optimizations are what’s at the heart of the catalysts business. Excellent catalysts are critical to achieving resource efficiency in the chemicals business."

Fixed-bed catalysts are used mostly in the large-scale continual processes involved in the manufacture of base chemicals. The new scale-up plant is available to research and development staff for the development of catalyst formulas at the laboratory scale before using pilot units to up-scale those formulas and optimize them for application in commercial production.

"For Evonik, expansion of the plant represents a further step in the course of systematic expansion of its expertise and capacities in the field of chemical catalysts," said Dr. Wilfried Eul, head of the Evonik Catalysts Business Line. "The aim is to maintain our ability to supply customers in the relevant markets with tailored catalysts produced at technologically sophisticated and cost-efficiently operated manufacturing facilities."

The expansion and new-construction measures have also created spatial links between all areas - the advantages being closer working proximity, easier enablement of parallel operations of machines and systems, and improved communication among staff. And the outfitting of existing facilities with state-of-the-art control technology has put capacity utilization on an even more efficient footing.

In the production area, Evonik has set up an additional facility for the optimized forming of catalysts for customer delivery and application. Outfitted with highly innovative technology, this new facility enables much improved material flow for the multiple processes involved, thereby doing away almost completely with the need for manual material transport. And new analysis and measuring techniques now allow the process to be precision-controlled.

As MRC informed earlier, Europe could see losses of 1 million mt of chlorine capacity by the time European legislation forbidding mercury-based production takes effect in December 2017.

Evonik, the creative industrial group from Germany, is one of the world leaders in specialty chemicals. Its activities focus on the key megatrends health, nutrition, resource efficiency and globalization. Evonik benefits specifically from its innovative prowess and integrated technology platforms. Evonik is active in over 100 countries around the world.

MRC

MOSCOW (MRC) -- Midland Plastics Inc., a plastic stock shape distributor and custom components manufacturer based in New Berlin, Wis., has acquired Advanced Extrusions Inc. of Franklin, Wis, said Plasticsnews.

Terms were not disclosed for the deal, which the privately held Midland announced Feb. 11 on its Facebook page. A short post says: "The entire custom extrusions operation has been relocated to our headquarters in New Berlin, WI and will continue to operate under the Advanced Extrusions name as a division of Midland."

Advanced Extrusions designs and manufacturers custom thermoplastic shapes, profiles, rods, tubings and flat stock for a wide range of applications, including agriculture, automotive, construction, housewares, point-of-purchase displays, sporting goods and water treatment.
MRC

MOSCOW (MRC) -- ExxonMobil anticipates capital spending of USD23 billion in 2016, down 25% from 2015. The company continues to selectively advance its investment portfolio, building upon attractive longer-term opportunities, as per the company's press release.

Exxon Mobil Corporation is achieving industry-leading financial performance throughout the commodity price cycle by maintaining a focus on the fundamentals, selectively investing in the business and paying a reliable and growing dividend, Rex W. Tillerson, chairman and chief executive officer, said.

"We remain steadfast in our mission to create superior long-term shareholder value," Tillerson said at the company’s annual analyst meeting at the New York Stock Exchange. "We have the financial flexibility to pursue attractive opportunities and can adjust our investment program based on market demand fundamentals."

"We are focused on maximizing benefits across the energy value chain," Tillerson said. The company captures unique value from its diverse, high-quality resource base from exploration, development and production all the way through to the fuels, lubricants and petrochemical products used by consumers.

ExxonMobil is on track to start up 10 new Upstream projects in 2016 and 2017, adding 450,000 oil-equivalent barrels per day of working-interest production capacity. The company is enhancing resource value through production optimization, technology application and cost management.

ExxonMobil’s Downstream and Chemical businesses have the scale and integration across refining, lubricants and chemicals to maximize product value while driving operating efficiency. Approximately 80 percent of the company’s 5 million barrel-per-day refining capacity is integrated with chemical and lubricant manufacturing facilities.

"We are advancing several Downstream and Chemical projects to increase feedstock flexibility, produce higher-value products and expand logistics capabilities to strengthen our competitive advantage in these businesses," Tillerson said.

As MRC wrote before, ExxonMobil is studying a proposal to expand its 334,600-bpd refinery in Beaumont, Texas, into the largest in the US. According to the Reuters report, ExxonMobil has pulled together a group of experts at the plant to do more detailed studies on potentially adding a third crude distillation unit (CDU).

ExxonMobil is the largest non-government owned company in the energy industry and produces about 3% of the world's oil and about 2% of the world's energy.
MRC

MOSCOW (MRC) -- Imports of polyethylene (PE) into Kazakhstan decreased in January 2016 by 44% from December 2015, totalling 4,400 tonnes, reported MRC analysts.

January PE imports to Kazakhstan slumped to 4,400 tonnes from 7,400 tonnes a month earlier. Lower PE shipments were caused by both seasonal factors and the devaluation of the national currency, which forced many companies to significantly reduced their purchasing due to financial constraints. High density polyethylene (HDPE) accounted for the greatest decrease in imports.

The structure of PE imports by grades looked the following way over the stated period.

January HDPE imports into Kazakhstan fell to 1,800 tonnes from 7,200 tonnes in December 2015. Local pipes producers accounted for the main reduction in the volume of purchaseswhichih was caused by both seasonal factors and the weakening of the national currency, which, in its turn, led to a major increase in PE prices and forced local companies to significantly reduce their purchasing. Some producers completely refused from January HDPE purchases.

It is worth noting that January 2015 HDPE imports exceeded 14,000 tonnes, with pipe grade PE accounting for more than 11,000 tonnes.

A somewhat different situation was in the low density polyethylene (LDPE) market. January total imports rose to 2,300 tonnes from 540 tonnes in December 2015. Conversely, a number of companies in this segment invested in LDPE purchasing in an effort to minimize the negative impact of the devaluation. Expectations of significant price increases in the spring months in Russia (the main LDPE supplier to Kazakhstan) also affected the decision to increase the volume of purchases.

Purchasing of linear low density polyethylene (LLDPE) by local companies was relatively stable and was not affected by seasonal factors. January LLDPE imports was 312 tonnes versus 224 tonnes in December 2015.

MRC