Lotte Chemical to restart No. 3 MEG plant in Yeosu in late September

MOSCOW (MRC) -- South Korea's Lotte Chemical plans to restart its No. 3 160,000 mt/year monoethylene glycol (MEG) plant in Yeosu in end September, reported S&P Global with reference to a company source.

Meanwhile, the company's No. 1 and No. 2 MEG plants at the site, each with 120,000 mt/year capacity, are running at 90%-100% capacity in September, a company source added.

The No. 3 plant was halted for maintenance in end May.

As MRC informed earlier, Lotte Chemical's second-quarter net profit fell 88.7 percent from a year earlier due to low demand amid the coronavirus pandemic. For the April-June period, Lotte Chemical posted a net profit of 30.6 billion won (USD25.8 million), compared with a profit of 271.2 billion won a year earlier, the company said in a regulatory filing.

MEG is one of the main feedstocks for the production of polyethylene terephthalate (PET).

According to MRC's ScanPlast report, Russia's estimated PET consumption totalled 367,720 tonnes in the first six months of 2020, up by 19% year on year. Russian companies processed 62,910 tonnes in June.

PP imports to Ukraine decreased by 1% in January-August

MOSCOW (MRC) -- Ukraine's polypropylene (PP) imports totalled about 88,800 tonnes in January-August of this year, down 1% year on year.
All PP grades accounted for the decrease in shipments, according to a MRC's DataScope report.

August PP imports into the country fell to 13,300 tonnes from 14,400 tonnes a month earlier, the main decrease in imports were seen in the shipments of homopolymer PP. Overall imports of propylene polymers reached 88,800 tonnes in January-August 2020, compared to 90,100 tonnes a year earlier. Demand for all grades of propylene polymers decreased, but propylene block copolymers (PP block copolymers) accounted for the largest reduction.

The structure of PP imports by grades looked the following way over the stated period.
August imports of homopolymer PP to the Ukrainian market decreased to 9,200 tonnes from 11,100 tonnes a month earlier, local companies reduced their purchasing of PP in Azerbaijan, Russia and Saudi Arabia. Total homopolymer PP imports were 68,300 tonnes in January-August, compared to 69,300 tonnes a year earlier.

August imports of PP block copolymers into the country amounted to about 1,900 tonnes compared to 1,400 tonnes in July, local companies reduced the volume of purchases of injection moulding polypropylene. Over the reporting period, about 8,800 tonnes of propylene block copolymers were imported against 9,100 tonnes for the same period in 2019.

August PP random copolymers imports increased to 1,900 tonnes from 1,700 tonnes a month earlier, local companies raised their purchasing of pipe PP random copolymers. Overall PP random copolymers imports reached 10,200 tonnes in January-August 2020, compared to 10,600 tonnes a year earlier.

Ukraine's imports of other propylene copolymers for the period were about 1,400 tonnes in the first eight months of the year.


Sinopec Zhongke starts selling commercial PP from its new plant in China

MOSCOW (MRC) -- Sinopec Zhongke Refinery and Petrochemical has started selling on-spec polypropylene (PP) materials in the open market with limited quantity from its new plant in China, reported S&P Global with reference to sources.

Thus, first lots of commercial material enterd the market in early September, 2020.

The company successfully completed the trial run at its newly constructed PP plant, consisting of two lines, and proceeded to commercial production within the month of August.

Thus, No. 1 PP unit with an annual capacity of 350,000 tons/year started producing commercial cargoes on 18 August 2020. The initial output might be homo-PP yarn before the company switches to PP fiber grades. And No. 2 PP line with nameplate capacity of 200,000 tons/year was scheduled to produce commercial cargoes on 24 August 2020, making homo-PP injection and high MI PP copolymer.

As MRC wrote previously, Sinopec Zhongke successfully conducted trial runs at its new 350,000 tons/year No. 1 PP unit on 9 June, 2020.

According to MRC's ScanPlast report, overall PP production in Russia increased in January-July 2020 by 24% year on year to 1,063,700 tonne. ZapSibNeftekhim accounted for the main increase in the output.

China Petrochemical Corporation (Sinopec Group) is a super-large petroleum and petrochemical enterprise group established in July 1998 on the basis of the former China Petrochemical Corporation. Sinopec Group"s key business activities include the exploration and production of oil and natural gas, petrochemicals and other chemical products, oil refining.

Celanese again raises September VAM prices in China

MOSCOW (MRC) -- Celanese Corporation, a global specialty materials company, once again increased September list and off-list selling prices for Vinyl Acetate Monomer (VAM) sold in China, as per the company's press release.

The price increase is effective for orders shipped on or after 15 September, 2020, or as contracts otherwise allow, and is incremental to any previously announced increases.

Thus, September VAM prices rose for the Chinese region by RMB700/mt.

As MRC reported earlier, the company also raised its VAM prices for China on 2 September, 2020, by the same amount.

According to MRC's DataScope report, June EVA imports to Russia fell by 22,5% year on year to 2,940 tonnes from 3,800 tonnes a year earlier, and overall imports of this grade of ethylene copolymer into the Russian Federation dropped in January-June 2020 by 8,16% year on year to 17,440 tonnes (18,980 tonnes a year earlier).

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, Celanese employs approximately 7,700 employees worldwide and had 2019 net sales of USD6.3 billion.

Crude oil futures fall ahead of OPEC+ meeting

MOSCOW (MRC) -- Crude oil futures fell during mid-morning trade in Asia Sept. 17 despite the draw on US' crude inventories, as the market awaited news from the impending OPEC+ meeting, reported S&P Global.

At 11.23 am Singapore time (0323 GMT), ICE Brent November crude futures were trading at USD41.63/b, down 59 cents/b (1.47%) from the Sept. 16 settle, while the NYMEX October light sweet crude contract was at USD39.53/b, down 63 cents/b (1.49%).

The decline comes after both crude oil markers surged USD1.69/b and USD1.88/b, respectively, overnight after the US Energy Information Administration released data showing that US commercial crude inventories had declined 4.39 million barrels during the week ended Sept. 11.

"Following yesterday's API draw of 9.5 million barrels, some energy traders were not impressed with the EIA report of a 4.4 million drop in stockpiles," Edward Moya, senior market analyst from OANDA, said in a Sept. 17 note.

In the same note, Moya said: "WTI crude is back above the USD40/b level, but it might struggle here as energy traders start to doubt that the OPEC+ deal will last much longer. The Saudis are not going to save the day and the lack of compliance with the cheaters, UAE and Iraq, will mean oversupply concerns are possibly just around the corner."

OPEC and its allies will have an online monitoring meeting on Sept. 17 to assess the situation, and determine whether their current production cuts are sufficient to prevent an oil supply glut amid increased expectations of non-OPEC supply.

Analysts have indicated that they expect the meeting to yield little change with focus primarily on compliance.

"Beyond reaffirming compliance and perhaps some resolution on catching up on quota volumes, we should expect limited new news and certainly nothing to significantly bump the crude market out of its current funk and push Brent back to USD45/b," Stephen Innes, chief global markets xtrategist at AxiCorp, said in a Sept. 17 note.

Earlier this year, as MRC wrote before, BP said the deadly coronavirus outbreak could cut global oil demand growth by 40 per cent in 2020, putting pressure on Opec producers and Russia to curb supplies to keep prices in check.

And in September 2019, six world's major petrochemical companies in Flanders, Belgium, North Rhine-Westphalia, Germany, and the Netherlands (Trilateral Region) announced the creation of a consortium to jointly investigate how naphtha or gas steam crackers could be operated using renewable electricity instead of fossil fuels. The Cracker of the Future consortium, which includes BASF, Borealis, BP, LyondellBasell, SABIC and Total, aims to produce base chemicals while also significantly reducing carbon emissions. The companies agreed to invest in R&D and knowledge sharing as they assess the possibility of transitioning their base chemical production to renewable electricity.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's DataScope report, PE imports to Russia dropped in January-June 2020 by 7% year on year to 328,000 tonnes. High density polyethylene (HDPE) accounted for the main decrease in imports. At the same time, PP imports into Russia rose in the first six months of 2020 by 21% year on year to 105,300 tonnes. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.