MOSCOW (MRC) -- China’s Shanghai International Energy Exchange (INE) has approved four entities as designated delivery warehouses for its upcoming low-sulfur fuel oil (LSFO) futures contract, according to Hydrocarbonprocessing with reference to the company's statement.
The entities were listed as Sinochem-Xingzhong Oil Staging (Zhoushan) Co., Ltd., Zhejiang Ocean Oil Products Warehousing Co.,Ltd., Dading Petroleum Logistics Co.,Ltd. and Yangshan Shengang International Oil Logistics Co., Ltd.
They will have total approved storage capacity of 570,000 tonnes and active storage capacity of 320,000 tonnes. The storage fee is 3 yuan per tonne each day.
The LSFO contract, with sulphur content lower than 0.5%, will debut on June 22, with foreign investors allowed to participate.
The INE had published rules for its low sulphur fuel oil contract on Wednesday, stating that it will be traded at 10 tonnes per lot with a daily price limit of 5% and a minimum trading margin of 8%.
As MRC reported earlier, China’s Sinochem Quanzhou Petrochemical successfully started up its newly constructed naphtha cracker in Quanzhou, Fujian province on 16 May 2020, setting the company on track to bring its downstream units online by mid of the year. The cracker has an annual capacity of 1 million tons of ethylene.
Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 557,060 tonnes in the first three month of 2020, up by 7% year on year. High density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments rose because of the increased capacity utilisation at ZapSibNeftekhim. Demand for LDPE subsided. At the same time, PP shipments to the Russian market was 267,630 tonnes in January-March 2020, down 20% year on year. Homopolymer PP and PP block copolymers accounted for the main decrease in imports.