Clariant Chemicals reports Rs 191.8 Cr net profit for Q2 FY20-21

MOSCOW (MRC) -- Clariant Chemicals Limited., an Indian subsidiary of specialty chemicals giant Clariant AG, announced its results for the second quarter ended September 30, 2020, reported Kemicalinfo.

The company reported a net profit of Rs 191.8 crores for the period ended September 30, 2020 as against net profit of Rs 2.7 crores for the previous quarter.

Net sales grew 40% to Rs 180.8 crores during the period ended September 30, 2020 as compared to Rs 129.0 crores during the previous quarter.

The company reported a net profit of Rs 191.8 crores for the period ended September 30, 2020 as against net profit of Rs 9.2 crores for the prior-year quarter.

Net profit grew mainly due to a gain of Rs 254.83 crore from sale of its business unit.

Net sales decreased 4.6% to Rs 180.8 crores during the period ended September 30, 2020 as compared to Rs 189.7 crores during the prior-year quarter.

The company reported a net profit of Rs 194.5 crores for the 6 months period ended September 30, 2020 as against net profit of Rs 14.9 crores for the prior-year 6 months period.

Net sales dropped 22.4% to Rs 309.8 crores during the 6 months period ended September 30, 2020 as compared to Rs 399.5 crores during the prior-year 6 months period.

In the filing, the company said it gained Rs 254.83 crore from the sale of its business unit Masterbatches to Polyone Polymers India Pvt Ltd in July.

Clariant Chemicals Vice-Chairman and Managing Director Adnan Ahmad said that coming out of a strong performance in the previous fiscal year, the COVID-19 pandemic impacted the company’s sales during the first quarter of the current fiscal. However, the latest quarter has already seen a good recovery.

“We look forward to continued growth in the months ahead,” he added.

As MRC reported before, in October 2020, Clariant (Muttenz, Switzerland) announced the construction of a new state-of-the-art catalyst production site in China. This project represents a significant investment which further strengthens Clariant’s position in China and enhances its ability to support its customers in the country’s thriving petrochemicals industry.

The new facility will be primarily responsible for producing the Catofin catalyst for propane dehydrogenation, which is used in the production of olefins such as propylene. Thanks to its excellent reliability and productivity, Catofin delivers superior annual production output compared to alternative technologies, resulting in increased overall profitability for propylene producers, says the company. Construction at the Dushan Port Economic Development Zone in Jiaxing, Zhejiang Province was scheduled to commence in Q3 2020, and Clariant expects to be at full production capacity by 2022.

Propylene is the main feedstocks for the production of polypropylene (PP).

According to MRC's ScanPlast report, PP shipments to the Russian market reached 880,130 tonnes in the nine months of 2020 (calculated using the formula: production minus exports plus imports, excluding producers" inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.

Clariant AG is a Swiss chemical company and a world leader in the production of specialty chemicals for the textile, printing, mining and metallurgical industries. It is engaged in processing crude oil products in pigments, plastics and paints.
MRC

Repsol to invest USD22 billion by 2025 in energy transition toward net zero carbon goal

MOSCOW (MRC) -- Repsol (Madrid, Spain) will invest EUR18.3 billion (USD21.8 billion) between 2021 and 2025 to accelerate the company’s energy transition toward its long-term goal of achieving net-zero carbon emissions by 2050, reported Chemweek.

The company says it will decarbonize its asset portfolio and establish a new operating model, with EUR5.5 billion of the total investment by 2025 to be spent on low-carbon and renewable energy businesses. Repsol’s current organization will evolve into four business areas: upstream, customer, low-carbon generation, and industrial - which includes its chemicals, refining, and biofuels activities. In 2019 Repsol’s chemicals sales volumes totaled 2.8 million metric tons.

“We will be more efficient and increase our renewable energy objectives as well as our manufacture of products with a low, neutral, or even a negative carbon footprint. We will promote circular economy initiatives, develop new energy solutions for our customers, and boost cutting-edge projects to reduce the industry’s carbon footprint,” says CEO Josu Jon Imaz.

Repsol says the new strategy will be “highly flexible” in the current macroeconomic environment, with the next two years focusing on ensuring its financial strength and efficiency, while also prioritizing energy transition and renewable projects. From 2022 onward the focus will increasingly shift toward the acceleration of growth, it says. The low-carbon business also includes the possible involvement of partners or investors, or a potential stock exchange listing, to “decisively accelerate the achievement of objectives and guarantee a higher return from our operations,” it adds.

The strategic plan will see the industrial business maintain its competitiveness, adjust its capacity, build new carbon-neutral platforms, and reduce carbon dioxide (CO2) emissions by more than 2 million metric tons/year, it says. Repsol’s seven large industrial sites in Spain, Portugal, and Peru will become multi-energy hubs, with the four key pillars for their transition being the circular economy, renewable hydrogen, energy efficiency, and the capture and use of CO2. Repsol says it aims to be a leader in renewable hydrogen in the Iberian Peninsula by achieving production of 400 megawatts by 2025, with the target of over 1.2 gigawatts in 2030. “The capture and use of CO2 will also be key to this transformation process,” it says. Investments in its industrial business will be kept at an average of EUR900 million per year, it adds.

Repsol is aiming to cut its CO2 emissions by 12% in 2025, 25% in 2030, and 50% in 2040. The company first unveiled its 2050 net-zero goal in December.

As MRC informed earlier, Repsol has just selected Axens Vegan technology for its first production plant for advanced biofuels in Spain at its Cartagena refinery. This new plant will be capable of producing 250,000 TPA of biodiesel, biojet, bionaphtha, and biopropane. Repsol’s project outlines Axens’ expertise in hydrotreated vegetable oils (HVO) and its commitment to power sustainability in transport.

We remind that Repsol shut down its cracker in Tarragona (Spain) for maintenance in the fourth quarter of 2019. The turnaround at this steam cracker, which produces 702,000 mt/year of ethylene and 372,000 mt/year of propylene, was pushed back from Q3 2019. The exact dates of maintenance works were not disclosed.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,594,510 tonnes in the first nine months of 2020, up by 1% year on year. Only high density polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market reached 880,130 tonnes in the nine months of 2020 (calculated using the formula: production minus exports plus imports, excluding producers" inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.

Repsol S.A is an integrated Spanish oil and gas company with operations in 28 countries. The bulk of its assets are located in Spain.
MRC

OCI NV net loss narrows as higher volumes boost revenue

MOSCOW (MRC) -- Methanol and nitrogen fertilizer producer OCI NV (Amsterdam, Netherlands) reports an adjusted net loss of USD67 million for the third quarter compared with an adjusted net loss of USD120 million in the same period last year. Revenue increased 19% year on year (YOY) to USD752 million and adjusted EBITDA jumped 79% to USD192 million, reported Chemweek.

A 30% YOY rise in sales volume to 2.8 million metric tons boosted revenue, the company says.

Industrial end markets for methanol strengthened significantly through the third quarter and into the fourth quarter, the company says. Nitrogen fertilizer prices have also improved, but the US nitrogen market remains challenged with prices at steep discounts to global benchmarks due to intense price-based competition for urea ammonium nitrate (UAN), and urea imports into the US priced below the point of origin, OCI says.

“We reported another quarter of healthy volume growth in both our methanol and nitrogen segments, driving a material increase in adjusted EBITDA year over year,” says CEO Ahmed el-Hoshy. “We remain on track to deliver robust volume growth in 2020 and, as we reach run-rate production, we expect to benefit from a further step-up in volumes in 2021.”

Hoshy confirms that the COVID-19 pandemic has not had a direct impact on OCI’s operations, “but our results were held back by significantly lower nitrogen and methanol prices compared to a year ago. However, we have recently started to benefit from an improving price environment, as global nitrogen markets enjoy positive tailwinds for the remainder of this year and into 2021 and the outlook for our methanol end markets has strengthened significantly,” he says.

Worldwide urea prices have rebounded since reaching “a trough” in the second quarter and ammonia started to recover in October, according to Hoshy. “However, US nitrogen prices are trading at severely discounted prices relative to global benchmarks. Despite being a deficit market, US urea imports continue to be priced below the point of origin in the Arab Gulf, a situation which could trigger antidumping investigations. UAN has been impacted by increased domestic volumes contributing to intense price-based competition in the US Gulf. Since July, it has been more favorable for Russia and Trinidad to export UAN to Europe inclusive of duties than to the US Gulf,” he says.

OCI expects nitrogen fertilizer demand in importing countries to remain healthy, supported by rising corn prices. Ammonia prices have lagged urea, but have started to benefit from a recovery in industrial markets, high-cost capacity shutdowns, and higher feedstock prices, the company says.

Meanwhile, US methanol spot prices have roughly doubled since reaching a bottom below USD150/metric ton in June, OCI says. Rising utilization rates of methanol-to-olefin (MTO) plants in China on the back of healthy MTO economics versus naphtha crackers have been a key driver of a rebound in methanol demand, it says.

The outlook for downstream demand for methanol has improved, with fuel consumption picking up, and a gradual return of industrial and construction activity worldwide, it says. Following record methanol production for OCI in the third quarter of 2020, normalization of production and improved onstream efficiency is expected to drive volume growth in the second half of 2020 and in 2021, the company says.

Separately, OCI’s board has formally ratified a decade-long group policy to not produce, sell, or trade solid ammonium nitrate (AN) and has committed not to do so in any future partnerships or transactions. “Given the increasing concerns surrounding the explosive nature of AN, the product is easily substituted by much safer other nitrogen products,” the company says.

As MRC informed earlier, worldwide demand for methanol is forecast to expand at rates below GDP growth for the first time, said Mike Nash, vice president/syngas chemicals at IHS Markit. Speaking last Tuesday in a panel session at the 38th World Methanol Conference, being held by IHS Markit in a virtual format, Nash said that global methanol demand is predicted to grow on average 2.8%/year during the next 10 years, lagging world GDP growth of 3.2%/year. The methanol market is “at a turning point,” Nash said. The current and forecast lower crude oil price means less demand for methanol from the fuels industry, according to Nash. Meanwhile, low crude prices are helping to weaken the economics of methanol-to-olefins (MTO) production. Growth in MTO capacity in China has kept methanol demand growth above GDP growth in recent years, Nash said. MTO plants have operated at high rates and generated high margins in 2020, but there is “a challenging time to come,” he said.

We remind that in early September 2020, Ningxia Baofeng Energy Group Co. (Baofeng Energy) selected KBR's proprietary cracker technology for its new methanol-to-olefins (MTO) project to be built in Ningxia, China. Under the contracts, KBR will provide process technology licensing and process design packages for Baofeng Energy's 500,000-t/y coal-to-olefins facility and its 500,000-t/y C2-C5 comprehensive utilization project. Once complete, the complex will be the "largest" single-train MTO plant in the world, KBR noted.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,594,510 tonnes in the first nine months of 2020, up by 1% year on year. Only high denstiy polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market reached 880,130 tonnes in the nine months of 2020 (calculated using the formula: production minus exports plus imports, exluding producers' inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.
MRC

LLDPE prices in Russia rise in November under pressure of situation in foreign markets

MOSCOW (MRC) -- Many Russian converters expected cuts in December low density polyethylene (LDPE) prices under the pressure from seasonal factors. But the situation in foreign markets led to the opposite effect, polyethylene (PE) prices went up in the last month of autumn, according to ICIS-MRC Price report.

By mid-October, a series of shutdowns for maintenance at Russian LDPE plants had come to an end. Some converters said the increased supply from domestic producers and a seasonal drop in demand for finished products should have led to lower LDPE prices, as it was the case in the previous years. But the situation in foreign markets has been unfolding exactly the opposite. High prices in Asia allowed Russian producers to export PE at higher prices than prices in the domestic market. And, as a result, domestic LDPE prices were moving up to the export level.

In the third decade of August-the first half of October, three Russian producers simultaneously shut their production capacities for repairs: Ufaorgsintez, Tomskneftekhim and Kazanorgsintez. Outages of the key producers led to a shortage of LDPE in the market and a price rise. By the second half of October, the last shutdowns for turnarounds in Ufa and Kazan were finished, which should have led to an increase in supply of PE in the market.

But there was still no oversupply of LDPE in November. Kazanorgsintez operated with incomplete capacity utilisation during the month, there were also restrictions on capacity utilisation at some of Ufaorgsintez's production capacities, and the Angarsk Polymers Plant shut its production for several days because of technical issues.

Demand for LDPE has been strong as for November since the beginning of the month, however, this was mostly typical for polyethylene (PE) at its lower price range. And by the middle of the month, many small-size sellers said they had sold out all their monthly quantities. PE prices have begun to go up gradually since the middle of the month, and in some cases, prices of 108 grade LDPE have reached Rb98,000/tonne CPT Moscow, including VAT, by late November, whereas by end-November 2019, prices of this PE grade had dropped below Rb80,000/tonne CPT Moscow, including VAT.

In Asia, LDPE prices has been dynamically rising since mid-summer, and last week's prices in China exceeded USD1,230/tonne CFR. On the back of this, some Russian producers reporter good export contracts, and deals were done in the range of USD1,100-1,170/tonne FCA, which even with the current strengthening of the rouble exchange rate, including taxes, exceeded Rb100,000/tonne FCA, including VAT.

Good export contracts allowed Russian producers to speak about a proportional increase in LDPE prices in the domestic market. This week, Tomskneftekhim virtually already announced a rise of Rb4,000/tonne in spot December prices.
MRC

Iranian president inaugurates petrochemical plant

MOSCOW (MRC) -- Iranian President Hassan Rouhani on Thursday inaugurated Lordegan Petrochemical Company in the southwest of the country, according to XINHUANet.

The plant, which is located in Chaharmahal and Bakhtiari province, has the capacity to produce 677,000 tons of ammonia and 1,075 tons of urea annually.

Rouhani said during the opening ceremony that the products of the facility will be exported and Iran is ready to supply the international market at lower prices, official IRNA news agency reported.

He also welcomed foreign investments in the country's development projects.

According to Tasnim news agency, 800 million U.S. dollars has been invested in the plant so far.

As MRC reported earlier, Iran will launch 42 petrochemical projects by the end of next year.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,594,510 tonnes in the first nine months of 2020, up by 1% year on year. Only high denstiy polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market reached 880,130 tonnes in the nine months of 2020 (calculated using the formula: production minus exports plus imports, excluding producers' inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.
MRC