Hyosung to double spandex fiber capacity in Brazil

MOSCOW (MRC) -- Hyosung (Seoul, South Korea) says it will invest USD36 million to almost double existing production capacity at its spandex fiber plant in Santa Catarina, Brazil, reported Chemweek.

The 10,000-metric tons/year capacity expansion for the facility in southern Brazil will be completed by December 2021, raising the plant’s total capacity to 22,000 metric tons/year, it says. The capacity hike will help to meet a “rapid rise” in demand for the synthetic fiber in the Americas, it says.

“In the Brazilian market, the import tariff rate for spandex is as high as 18%, which is more than double the rate applied in other regions. Therefore, a local production base is essential for maintaining price competitiveness,” according to Hyosung. Brazil’s location is also advantageous for export to nearby countries, it says. The company first established a production base in Brazil in 2011 and currently holds a market share in Brazil of 65%.

“The unprecedented risk caused by Covid-19 has aggravated uncertainty and accelerated the speed of change,” says Hyosung chairman Cho Hyun-joon. “In times of change, we must turn crisis into opportunity by continuously investing in our future.”

Hyosung, the world’s leading producer of spandex, also says it decided in November to invest 60 billion South Korean won (USD55 million) to expand production capacity at its existing 25,000-metric tons/year spandex plant in Turkey to target the market in Europe. The expansion will be completed by the third quarter of 2021 and raised the plant’s capacity to 40,000 metric tons/year.

The company produces approximately 340,000 metric tons/year of spandex fiber, one third of current global demand.

As MRC wrote previously, following the start-up at the newly constructed PP plant in Vietnam on 12 February 2020, it was reported that Hyosung reached on-spec cargoes approximately in mid-February. The first prime grade parcels were homo-PP yarn grade F501N with a melt index of 3.7.

This is the No. 1 PP unit that has an annual capacity of 300,000 tons/year, operating using external sources of propylene. The company is constructing the Phase II project at the same location, which houses a propane dehydrogenation (PDH) plant and No. 2 PP unit that could produce another 300,000 tons/year.

According to MRC"s ScanPlast report, PP shipments to the Russian market reached 978,870 tonnes in January-October 2020 (calculated using the formula: production minus exports plus imports minus producers' inventories as of 1 January, 2020). Supply of exclusively of PP random copolymer increased.

Hyosung Corporation is a Korean industrial conglomerate, founded in 1957. It operates in various fields, including the chemical industry, industrial machinery, IT, trade, and construction.

Huntsman to acquire Gabriel Performance Products for USD250 million

MOSCOW (MRC) -- Huntsman (The Woodlands, Texas) has agreed to acquire specialty chemicals firm Gabriel Performance Products (Akron, Ohio) for USD250 million in cash from Audax Private Equity. Gabriel, a manufacturer of specialty additives and epoxy curing agents for the coatings, adhesives, sealants, and composite end markets, has three manufacturing facilities located in Ashtabula, Ohio; Harrison City, Pennsylvania; and Rock Hill, South Carolina, said Chenweek.

Gabriel’s 2019 revenues were about USD106 million, according to Huntsman, which says the purchase price is about 11x adjusted EBITDA, or 8x pro forma after accounting for synergies. Huntsman expects to close the deal in the first quarter of 2021.

Scott Wright, president of Huntsman's advanced materials division, says the acquisition will broaden Huntsman’s specialties portfolio and complement the recent acquisition of CVC Thermoset Specialties. “Gabriel makes highly specialized toughening and curing agents and other additives used in a wide range of composite, adhesive, and coatings applications,” he notes. “We expect that the Gabriel business will strengthen our North America footprint and provide significant commercial synergies as we expand and globalize their specialty products across our global footprint and customer base."

Huntsman acquired CVC for about USD300 million in May 2020. Peter Huntsman, chairman, president, and CEO, says the purchase of Gabriel concludes a series of strategic initiatives in the advanced materials division that began in 2019.

"Our initial intent was to complete the acquisitions of Gabriel and CVC simultaneously, together with the divestiture of our India DIY business earlier this year,” he says. “Despite the challenges created by COVID[-19], I am pleased that we have already closed on two of the transactions and intend to close on the acquisition of Gabriel within the first quarter of 2021. We have significantly strengthened our advanced materials portfolio and broadened our offerings to the market."

Combined, the three transactions will add approximately USD57 million of adjusted EBITDA pro forma for synergies to the advanced materials division at a cost of less than 5x EBITDA, says Huntsman. Gabriel in late 2015 acquired InChem’s phenoxy resin business, including the Rock Hill production facility. In October 2019, the company acquired a portfolio of alkyd resins from Deltech Resin Company.

As MRC informed earlier, Huntsman’s Advanced Materials business is proud to announce the expansion of our Pan-American business relationship with our preferred distribution partner, Azelis Americas CASE, LLC in the US and Azelis Canada, Inc. in Canada.

We remind, Huntsman officially inaugurated its new 22,000 tonne/year aromatic polyester polyols plant in Kuan Yin, Taiwan. The 3,600-square meter polyols plant, completed in May, expands Huntsman’s downstream polyurethanes capabilities in the Asia-Pacific region and marks the first time Huntsman has manufactured its TEROL polyols outside the United States.

Ethylene and propylene are feedstocks for producing PE and PP.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,760,950 tonnes in the first ten months of 2020, up by 3% year on year. Only high density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments increased. At the same time, PP shipments to the Russian market reached 978,870 tonnes in January-October 2020 (calculated using the formula: production minus exports plus imports minus producers' inventories as of 1 January, 2020). Supply of exclusively of PP random copolymer increased.

Huntsman Corporation is a publicly traded global manufacturer and marketer of differentiated and specialty chemicals with 2019 revenues of approximately USD7 billion. Our chemical products number in the thousands and are sold worldwide to manufacturers serving a broad and diverse range of consumer and industrial end markets. We operate more than 70 manufacturing, R&D and operations facilities in approximately 30 countries and employ approximately 9,000 associates within our four distinct business divisions.

Energy trader Gunvor launches new USD540 MM biodiesel loan

MOSCOW (MRC) -- Gunvor Group has closed a new USD540 million borrowing base facility to support biodiesel trading as the company shifts its strategy to promote cleaner products in line with EU climate targets, the company said Reuters.

The bookrunners for the deal were Credit Agricole and Rabobank. The loan is structured around the company's biofuel inventories, including two biofuel processing plants in Spain.

The Geneva-based firm has been trading biofuels since 2009. About half of Gunvor's traded volumes are considered "transitional" commodities, including biofuels, natural gas and liquefied natural gas.

As MRC informed earlier, in Europe, Petroineos plans to mothball nearly half of its 200,000 bpd refinery at Grangemouth in Scotland, and Gunvor will shutter its 110,000 bpd Antwerp oil refinery in Belgium. The outlook for refining remains mixed, with traditionally low-value naphtha and fuel oil possible bright spots in the new year.

As MRC informed earlier, Russia's output of chemical products rose in September 2020 by 6.7% year on year. At the same time, production of basic chemicals increased by 6.1% year on year in the first nine months of 2020, according to Rosstat's data. According to the Federal State Statistics Service of the Russian Federation, polymers in primary form accounted for the greatest increase in the January-September output. Last month's production of primary polymers decreased to 852,000 tonnes from 888,000 tonnes in August due to shutdowns in Tomsk, Ufa and Kazan. Overall output of polymers in primary form totalled 7,480,000 tonnes over the stated period, up by 16.4% year on year.

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.

Tupras uses Honeywell technology to increase diesel fuel production at Izmit

MOSCOW (MRC) -- Honeywell announced Tupras is improving the performance of its existing Honeywell UOP enhanced two-stage Unicracking process with the addition of an external heavy polynuclear aromatics (HPNA) stripper at its Izmit refinery, said Hydrocarbonprocessing.

The HPNA stripper will enable Tupras to maximize conversion in the unit, increasing unit profitability through an increase in the yields of distillates and the flexibility to process heavier feedstocks.

UOP provided the basic engineering, catalysts and technical services for the project. UOP has more than 30 years’ experience in HPNA management and has commercially proven solutions for new units and existing units enabling customers to achieve near 100% conversion throughout the entire catalyst cycle life. The innovative HPNA side stripper technology applied at the Izmit refinery allows Tupras to carry out pioneering projects throughout its refinery sites and advance its production processes.

"UOP HPNA management solutions improve unit performance and profitability via increased conversion to high value products through enhanced catalyst performance due to slower catalyst deactivation,” said Bryan Glover, vice president and general manager, UOP’s Process Technologies business. “The external HPNA stripper increases the unit’s conversion efficiency by mechanically removing HPNAs that cause deactivation of the catalyst, and lets customers use heavier feedstocks."

Since UOP's Unicracking process was introduced in 1960, the technology has advanced through the development of more effective catalysts, enhanced unit designs and novel reactor internals. Available in single- and two-stage processes, the technology is designed to produce higher yields of transportation fuels that adhere to tighter regulations using a wider range of feedstocks.

Honeywell UOP has licensed more than 240 Unicracking units in more than 50 countries. Including the Tupras unit at Izmit, UOP has licensed 19 enhanced two-stage Unicracking process units, with additional operating units in China and Turkey.

The Unicracking unit at Tupras is integrated with other UOP process technologies, including coker naphtha and distillate Unionfining units. The system, whose feedstocks include straight run diesel, coker gas oil and vacuum gas oils, was designed with a common fractionation section, reducing capital costs and improving Tupras' return on investment.

As MRC informed earlier, Honeywell's performance materials and technologies unit reports third-quarter net profit of USD442 million, down 24.0% year on year (YOY), on sales down 15.6% YOY, to USD2.2 billion. Honeywell (HON) - Get Report on Friday posted third-quarter adjusted earnings that beat analysts’ forecasts and sales ahead of predictions as double-digit growth in its defense and space, warehouse automation and PPE products and services offset a drop in aerospace revenue.

As MRC informed earlier, Honeywell UOP has announced that French energy company Total will utilize Honeywell UOP’s Ecofining process technology to produce renewable fuels, primarily for the aviation industry, at its Grandpuits platform at Seine-et-Marne in north central France. Once completed, the bio-refinery will process 400,000 tons of feed per year, producing up to 170,000 tons of sustainable aviation fuel, 120,000 tons of renewable diesel and 50,000 tons of renewable naphtha for production of bioplastics.

We remind, Honeywell announced Zhenhua Petrochemical Co. Ltd will use Honeywell UOP’s C3 Oleflex technology for propane dehydrogenation to process 1 million metric tons per year of polymer-grade propylene for a proposed plant in Dongying City, Shandong Province, China.

As MRC reported earlier, in May, 2020, Honeywell announced that Enterprise Products Partners L.P. will use Honeywell UOP’s C3 Oleflex technology in its second propane dehydrogenation plant, called "PDH 2". Located near Mont Belvieu, Texas, PDH 2 will produce 750,000 metric tons per year of polymer-grade propylene as part of Enterprise’s expansion of propylene manufacturing capacity.

Propylene is the main feedstock 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.

Epsilyte raises EPS resin prices

MOSCOW (MRC) -- Epsilyte (The Woodlands, Texas), a leading North American producer of expandable polystyrene (EPS), says it is increasing prices for all EPS grades, effective as of 1 January 2021 or as contracts allow, reported Chemweek.

The price rise will be USD0.06/lb. The increase is necessary “based on supply and demand dynamics, and the need for the business to achieve reinvestment economics,” the EPS producer says.

As MRC informed before, in November 2020, private equity company Wynnchurch Capital acquired Drew Foam Companies for an undisclosed sum. Monticello, Arkansas-based Drew Foam makes custom fabricated and moulded EPS products for the packaging, building products and OEM/consumer end markets. It offers both fabricated block and shape moulding capabilities across four manufacturing facilities in the Southeast US.

According to MRC's ScanPlast report, October estimated EPS consumption in Russia was 10,310 tonnes versus 10,740 tonnes a month earlier. Russia's estimated EPS consumption was about 80,000 tonnes in January-October 2020, down by 4% year on year. In November, demand was moderate in the Russian EPS market, whereas in the second half of the month, there was a decrease in activity in the EPS market as compared to October. Domestic prices of Russian material were in the range of Rb98,000-111,000/tonne CPT Moscow, including VAT.

Epsilyte is owned by private equity firm Balmoral Funds (Los Angeles, California). Epsilyte is one of North America’s leading producers of expandable polystyrene resin. The company is focused on solving customer needs for efficient, high-R value EPS. This includes reducing energy usage in buildings, ensuring safe and healthy food through innovative packaging technology, and participating in infrastructure investment both in the United States and abroad. Epsilyte is a portfolio company of Balmoral Funds LLC.