Kem One declares force majeure on PVC supply from France

MOSCOW (MRC) -- France’s Kem One declared a force majeure (FM) on polyvinyl chloride (PVC) supplies from its Saint-Fons site, France on February 3, reported NCT with reference to a source from the company.

Rising water levels on Rhone River, which interrupted the transportation of feedstock VCM, was cited as the reason behind the FM.

The interrupted navigation on Rhone River prevented the company from transporting vinyl chlorie monomer(VCM) to its Saint-Fons site and forced it to slow down production of PVC there. Internal stocks could not be replenished enough due to very high demand from customers, the source added.

Meanwhile, PVC production at the Balan site has been put under allocation for the same reason.

Saint-Fons site can produce around 210,000 tons/year of PVC, while the company’s Balan plant has a PVC production of 300,000 tons/year.

As MRC wrote before, in late July, 2020, ferric chloride leaked from Kem One’s (Lyon, France) PVC production site at Berre, France, into the Mediterranean Sea. Several reports quoted then a Kem One spokesperson, who confirmed that the leak came from a storage tank and that the liquid was discharged into the sea via a storm sewer. The company said the incident caused no injuries.

According to MRC's ScanPlast report, PP shipments to the Russian market reached 1 240,000 tonnes in 2020 (calculated using the formula: production, minus exports, plus imports, excluding producers' inventories as of 1 January, 2020). Supply of exclusively PP random copolymer increased.

Kem One, a fully integrated vinyl production company, was established mid-2012 following the acquisition of Arkema's vinyl products division by the Klesch Group. The company employs 2,600 people at 22 manufacturing sites, primarily in Europe but also in Asia and North America. Europe’s second-largest producer of PVC with revenues in excess of one billion euros, Kem One continues to grow and build on its numerous strengths with a view to becoming market leader for integrated vinyl solutions.

PVC production in Russia down by 2% in January 2021

MOSCOW (MRC) -- Overall production of unmixed polyvinyl chloride (PVC) totalled 89,800 tonnes last month, down by 2% year on year. At the same time, two producers managed to increase their PVC output, according to MRC's ScanPlast report.

January production of unmixed PVC was 89,800 tonnes versus 91,300 tonnes and 82,900 tonnes in January and December 2020, respectively. RusVinyl and Kaustic (Volgograd) reduced their capacity utilisation. Overall output of polymer totalled 976,500 tonnes in 2020 versus 975,000 tonnes a year earlier.

The structure of PVC production by plants looked the following way over the stated period.

RusVinyl produced 31,100 tonnes of PVC in January, with emulsion polyvinyl chloride (EPVC) accounting for 2,600 tonnes of the whole production volume, compared to 32,400 tonnes of PVC in January 2020 and 27,400 tonnes in December 2020. RusVinyl's overall output reached 332,900 tonnes in 2020, compared to 339,800 tonnes in 2019.

SayanskKhimPlast maintained a high level of capacity utilisation last month and produced 27,900 tonnes of suspension polyvinyl chloride (SPVC), which virtually corresponded to the figures in January and December 2020. The Sayansk plant managed to produce 299,500 tonnes of SPVC in 2020 versus 294,500 tonnes a year earlier.

Bashkir Soda Company produced 23,500 tonnes of SPVC in January 2021, compared to 23,600 tonnes in January 2020 and 23,100 tonnes in December 2020. The Baskhir plant's overall production of PVC reached 267,600 tonnes in 2020, up 2% year on year.

Kaustik, Volgograd produced 7,400 tonnes of SPVC last month, whereas this figure was at 7,500 tonnes in January 2020 and 6,900 tonnes in December 2020. The plant's overall output of resin reached 76,500 tonnes in 2020, compared to 77,500 tonnes in 2019.


PP supply remains tight in North America

MOSCOW (MRC) -- North American polypropylene (PP) supply has been extremely tight since the summer of 2020, when the industry saw a number of plant outages, followed by Hurricane Laura and Hurricane Delta, which damaged LyondellBasell's massive PP facility in Lake Charles, Louisiana, reported Chemweek with reference to market participants.

Just this week, LyondellBasell lifted its PP force majeure declaration from those events.

Three other US suppliers - Ineos, Formosa, and Total - still have PP force majeure (FM) declarations. In addition to plant issues and scheduled maintenance, the PP industry is facing a monomer shortage that shows no sign of easing in the near term.

Tight monomer supply has played a role in limiting PP operating rates. North American PP capacity utilization was at 90%-91% in November and December as average producer inventory days dropped into the high 20s, according to data from the ACC Plastics Industry Producers' Statistics Group.

As MRC informed earlier, LyondellBasell (Rotterdam, the Netherlands) declared force majeure on PP supplies from France on 2 December, 2020. The reason for the force majeure was not disclosed at the time of press. The FM was lifted in the first week of February.

According to MRC's ScanPlast report, PP shipments to the Russian market reached 1 240,000 tonnes in 2020 (calculated using the formula: production, minus exports, plus imports, excluding producers' inventories as of 1 January, 2020). Supply of exclusively PP random copolymer increased.

U.S. pipeline operator Energy Transfer to tap into alternative energy projects

MOSCOW (MRC) -- Energy Transfer LP said it had created a new business to ramp up efforts to develop alternative energy projects, as the pipeline operator aims to reduce its carbon footprint, said Hydrocarbonprocessing.

Traditional oil and gas companies are under increasing pressure to invest more in renewable energy and carbon-capture technology to battle climate change.

Energy Transfer's Alternative Energy Group will focus on renewable energy projects including solar and wind farms, either as a power purchaser or in partnership with third party developers, and will be led by the company's general counsel, Tom Mason.

The company said it would also look to develop renewable diesel and renewable natural gas opportunities, adding that these potential projects could involve the utilization of Energy Transfer's pipeline system.

As per MRC, Energy Transfer Partners agreed to acquire independent refiner Sunoco in a USD5.3 billion deal that would greatly expand the reach of Energy Transfer's pipeline system but could also saddle the company with aging refineries. Sunoco has been trying to sell itself since late 2011 after posting losses for much of the past two years because of high oil prices and decreasing fuel demand.

Sunoco Logistics Partners L.P. and Energy Transfer Partners, L.P. announced that they have entered into a merger agreement providing for the acquisition of ETP by SXL in a unit-for-unit transaction.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,220,640 tonnes in 2020, up by 2% year on year. Only shipments of low density polyethylene (LDPE) and high density polyethylene (HDPE) increased. At the same time, polypropylene (PP) shipments to the Russian market reached 1 240,000 tonnes in 2020 (calculated using the formula: production, minus exports, plus imports, excluding producers' inventories as of 1 January, 2020).

IG Petrochemicals board approves USD82 million to expand PA capacity in India

MOSCOW (MRC) -- IG Petrochemicals, an established market leader in Phthalic Anhydride (PA) in India, has announced a capital outlay of Rs 600 crore (USD82.6 million) to expand its PA capacity, according to Kemicalinfo.

Thus, the Board of IG Petrochemicals at its meeting held on 09 February 2021 approved the greenfield expansion of PA up to 80,000 MTPA & its Derivatives in Gujarat.

The capex will be financed through internal accruals and borrowings. The project will be completed within three years.

The company’s existing capacity is 220,000 MTPA with capacity utilization of 90%.

The company expects the demand for PA in domestic market to increase due to Govt. focus on Infrastructure spending and demand growth in downstream products like Paints, Plasticizers, Polyvinyl chloride (PVC), Unsaturated polyester resins (UPR) etc., led by good GDP growth in India.

As MRC reported earlier, India to renew antidumping duty on PA imports from Russia, removes Japan from ADD list. Latest ADD on Russian PA imports extends previous five-year period imposed in 2014; Japan removed after being deemed unlikely to resume dumping activities. The Directorate General of Trade Remedies (DGTR) of India on 5 January recommended continuing the ADD after its investigation showed that “there is likelihood of continuation or recurrence of dumping and injury if the existing ADDs are allowed to cease." he south Asian country’s previous five-year ADD on Russian PA imports expired in December 2020.

PA is used as a chemical intermediate in the production of phthalate plasticizers, saturated and unsaturated polyester resins. Phthalic anhydride is widely used in for the production of paints and varnishes and plasticizers for PVC products. In a small amount it is used in the manufacture of rubber products, tires. In addition, it is used in the light, pharmaceutical and electrical industries.

According to MRC's DataScope report, imports of suspension polyvinyl chloride (SPVC) into Russia totalled about 40,800 tonnes in 2020, down by 20% year on year. At the same time, exports decreased by 6%. December SPVC imports to Russia dropped to 0,600 tonnes from 1,600 tonnes in November. High PVC prices in foreign markets and a seasonal decline in demand in the previous two months had put a major pressure on import purchases of PVC from Russian companies.