BASF eyes restart of TDI plant at Ludwigshafen, Germany

MOSCOW (MRC) -- BASF is planning to restart its 300,000-metric ton/year toluene diisocyanate (TDI) plant in Ludwigshafen, Germany, by the end of October, according to sources. The company declared force majeure on 31 August after experiencing technical problems, it stated at the time, said Chemweek.

BASF has tried to restart the plant since then, but its efforts were unsuccessful. “They will make another restart attempt in two to three days,” says a market source. The company had planned three months of maintenance at the TDI plant this year, but postponed it to March 2021, citing the impact of COVID-19 as the main reason, the sources say. “The force majeure at our TDI plant in Ludwigshafen is still in place,” a BASF spokeswoman tells OPIS.

The force majeure at Ludwigshafen has exacerbated tightness in the global TDI market, according to James Elliott, principal analyst/polyurethane feedstocks at IHS Markit. This has not only been driven by supply-side issues but also demand has been particularly strong during the third quarter. Early indications for the fourth quarter are that offtake continues to strengthen, says Elliott.

BASF started operations at the Ludwigshafen TDI plant in November 2015 after investing more than €1 billion ($1.17 billion) to build it. Since then, it has not consistently operated at optimal rates at the site, encountering different production and technical issues which have caused delays and shutdowns, according to Elliott. The company stopped producing TDI at its 80,000-metric tons/year Schwarzheide facility, based in southern Germany, in April this year.

The COVID-19 pandemic and associated lockdowns led to a collapse in TDI demand during the second quarter as consumer spending on flexible polyurethane foam goods dropped, with total European demand plunging as much as 80% in April. Flexible polyurethane foam is mainly used in mattresses and furniture in western Europe.

BASF is due to release third-quarter results on 28 October 2020 and full-year results on 26 February 2021.

As MRC reported earlier, COVID-19 occurred at an already challenging time for the petrochemical industry and has required it to take some drastic actions, said the leaders of the worldпїЅs two biggest chemical companies, BASF and Dow, on Monday at the 54th European Petrochemical Association (EPCA) annual meeting, which is taking place in a virtual format. The pandemic has also accelerated key industry trends, particularly those around sustainability and the environment, they said.

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

According to MRC's ScanPlast report, Russia's overall PE production totalled 1,712,400 tonnes in the first seven months of 2020, up by 58% year on year. Linear low density polyethylene (LLDPE) accounted for the greatest increase in the output. At the same time, 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.

COVID-19 - News digest as of 14.10.2020

1. Crude oil futures maintain overnight losses on fear of supply glut

MOSCOW (MRC) -- Crude oil futures were steady during mid-morning Asian trade Oct 13, maintaining overnight losses, as production capacity in the US Gulf of Mexico started to come back online, heightening concerns of a supply glut amid an unimproved demand outlook, reported S&P Global. At 10.25 am Singapore time (0225 GMT) ICE Brent December crude futures were up 1 cent/b (0.02 %) from the Oct. 12 settle to USD41.74/b, while the NYMEX November light sweet crude contract was up 2 cents/b (0.05%) at USD39.45/b. Both international crude markets had dived 2.64% and 2.88% to settle at USD41.72/b and USD39.43/b, respectively, on Oct. 12, after supply disruptions caused by a Norwegian labor strike and a hurricane in the US Gulf of Mexico were resolved.


Chemical industry receives record number of European Responsible Care awards - Cefic

MOSCOW (MRC) -- Cefic says that the European chemical industry has received a record number of awards in the 2020 European Responsible Care awards “Caring in COVID-19 Times,” for their global response in fighting the pandemic, reported Chemweek.

The awards given to 16 chemical companies and federations across Europe showcase the essential role of the chemical industry in the fight against COVID-19, Cefic says. Winning companies and federations were recognized and rewarded for their efforts to keep critical supply chains running, to protect workers and the workplace, and to support communities in the unprecedented times, it says.

The creativity of the chemical industry "is bringing more added value for society than ever before," says Vincent De Cuyper, executive committee member at Solvay and chair/program council for health, safety and environment, responsible care and supply chains at Cefic. "Our sector is a solution provider for other industries, and for society at large. It has been again reaffirmed in the European Commission’s Green Deal that the chemical industry is an essential link in the value creation chain for Europe’s economy,” he says.

Since the beginning of the crisis, the European chemical industry’s top priority has been to ensure the health and safety of employees and to secure supplies of critical chemicals into medical, environmental and food supply chains amidst border closures and lockdown measures, Cefic says. Key examples include providing biocides for disinfectants, non-woven fabrics for masks, and supporting the European Commission’s work on green lanes and movement of workers, it says.

As MRC informed before, in mid-July, 2020, Cefic called on EU member states to agree urgently on a recovery plan to restart Europe’s economy and kick off investments toward a green and digital transition. The EU chemical industry is seeking investments in building renovation, clean mobility, the development of all forms of clean hydrogen, chemical recycling, and carbon capture and storage as well as carbon capture and utilization, Cefic said then.

We remind that in 2017, SIBUR joined the European Chemical Industry Council (CEFIC). SIBUR has also become a member of the European Committee of Ethylene Producers and Technology Suppliers (EEPC, part of CEFIC). Membership in the Council allowed SIBUR to take part in the work of 93 sectoral groups on more than 120 petrochemical products, in 90 strategic groups working on issues of sustainable development, innovation, trade, energy and law in the field of petrochemicals.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,496,500 tonnes in the first eight months of 2020, up by 5% year on year. Shipments of all ethylene polymers increased, except for linear low desnity polyethylene (LLDPE). At the same time, PP shipments to the Russian market reached 767,2900 tonnes in the eight months of 2020 (calculated using the formula - production minus exports plus imports - and not counting producers' inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.

Kaustik Volgograd resumes PVC production

MOSCOW (MRC) -- Volgograd Kaustik, Russia's fourth largest polyvinyl chloride (PVC) producer, has resumed production after a scheduled turnaround, according to ICIS-MRC Price report.

The plant's representative said PVC production at the Volgograd producer's started on 12 October, after a scheduled shutdown for repairs. The outage wast short and lasted for about 12 days. The plant's PVC production capacity is 90,000 tonnes/year.

PVC production at Volgograd Kaustik was launched in December 1972 with the assistance of the Japanese firm Kureh's specialists.

Nikokhim Group is one of the leaders of the Russian chemical industry, the main production assets of which are located in the southern industrial hub of Volgograd.

The holding company includes: JSC Kaustik is the principal plant of the group, manufactures basic products - caustic soda, chloroparaffins, synthetic hydrochloric acid, chlorine trademark, polyvinyl chloride, sodium hypochlorite, etc .; CJSC NikoMag - production of anti-icing materials, magnesium chloride, magnesium oxide and hydroxide; Zirax, Ltd. - production of high-purity reagents for various industries and JSC Poligran - the production of plastic compounds and rigid PVC compounds.

VYNOVA to conduct turnaround at its PVC plant in France

MOSCOW (MRC) -- European chlor-alkali and polyvinyl cloride (PVC) producer VYNOVA will conduct maintenance originally planned for August at Mazingarbe, France, in October, along with its Beek site in Netherlands, where the associated Tessenderlo chlor-alkali and monomer vinyl cloride (VCM) production will also undergo works, reported S&P Global with reference to the source.

"Our large Tessenderlo unit will be down in October and two out of three plants will be down in October," the source said.

As MRC wrote before, VYNOVA last carried out a maintenance turnaround at its PVC plant at Mazingarbe within 10 days from late July to eary August, 2017.

According to MRC's ScanPlast report, Russia's overall PVC production totalled 718,500 tonnes in January-September 2020, down by 0.3% year on year. At the same time, only two producers managed to increase their PVC output.

VYNOVA is a leading European PVC and chlor-alkali company. It operates production sites in five countries and has over 1,250 employees, realising an annual turnover of EUR1 billion. The company's products play a key role in manufacturing numerous industrial products and consumer goods that improve the quality of life. Established in 2015, VYNOVA is the chlor-vinyls platform of the International Chemical Investors Group (ICIG).