PC imports to Russia almost halve in Jan-Apr 2021

MOSCOW (MRC) -- On the back of an acute shortage of European material and high polycarbonate (PC) prices in Asia, imports of PC granules into Russia (excluding shipments from Belarus) decreased in the first four months of 2021 almost by 2 times year on year to 4,400 tonnes, according to MRC's DataScope report.

Imports of material into the country were 8,100 tonnes in January-April 2020. Imports, excluding imports to Belarus, were 990 tonnes last months versus 2,000 tonnes in April 2020. March 2021 imports of PC granules were 1,220 tonnes.

Extrusion grade PC accounted for the reduction in imports. Its share in the total imports of material into the Russian Federation was 22% (990 tonnes) versus 71% (5,800 tonnes) a year earlier. The share of injection moulding grades rose to 67% (3,000 tonnes) in the January-April 2021 versus the share of 23% (1,900 tonnes) a year earlier.
Covestro (with the share of 50%) and Sabic Innovative Plastics (22%) were the main import suppliers of PC granules. Both producers significantly reduced their shipments in 2021. Thus, imports of Covestro's material fell by 27% in the first four months of 2021: from 3,000 tonnes a year earlier to 2,200 tonnes. Sabic's shipments decreased even more - to 970 tonnes (excluding Belarusian imports) from 4,300 tonnes a year earlier.

MRC

1. Crude oil futures drop on large US product inventories

MOSCOW (MRC) -- Crude oil futures slipped during midmorning trade in Asia June 10 on the back of a large build in US product inventories, which cast a shadow of doubt on the optimism surrounding summer driving demand in the region, reported S&P Global. At 10:38 am Singapore time (0238 GMT), the ICE August Brent futures contract was down 65 cents/b (0.90%) from the previous settle at USD71.57/b while the NYMEX July light sweet crude contract was down 61 cents/b (0.87%) at USD69.35/b. The Energy Information Administration reported a 5.2 million-barrel draw in US crude oil inventories in the week ended June 4 amid high refining run rates, but market sentiment was bogged down by a large build of 7 million barrels in gasoline stocks and a 4.4 million-barrel build in distillate inventories over the same period.

2. US PVC exports fall 18.4% YOY in Jan-Apr 2021

MOSCOW (MRC) -- US exports of construction staple polyvinyl chloride (PVC) in the first four months of 2021 were 18.4% lower than in the January-April period of 2020, reflecting fallout from tight supply and strong domestic demand, according to S&P Global with reference to US International Trade Commission data released June 9. The US shipped out 673,664 mt of PVC over January-April 2021, compared to 825,996 mt in the year-ago period, the data showed. April 2020 marked the height of coronavirus pandemic-related shutdowns in the US, which hindered construction activity and prompted sharp production cuts. Upstream chlor-alkali rates plunged to 68% in April 2020 from 90% in March that year, industry statistics show.

MRC

MOSCOW (MRC) -- US exports of construction staple polyvinyl chloride (PVC) in the first four months of 2021 were 18.4% lower than in the January-April period of 2020, reflecting fallout from tight supply and strong domestic demand, according to S&P Global with reference to US International Trade Commission data released June 9.

The US shipped out 673,664 mt of PVC over January-April 2021, compared to 825,996 mt in the year-ago period, the data showed.

April 2020 marked the height of coronavirus pandemic-related shutdowns in the US, which hindered construction activity and prompted sharp production cuts. Upstream chlor-alkali rates plunged to 68% in April 2020 from 90% in March that year, industry statistics show.

In 2021, sustained subfreezing temperatures hit the US Gulf Coast and much of the US in mid-February, forcing widespread weeks-long petrochemical plant shutdowns. February chlor-alkali rates fell to 59% from 82% in January, and then rose to 71% in March and 80% in April, industry statistics show.

In the first four months of 2019, when there were no pandemic-related or freeze-related issues, the US exported more than 1 million mt of PVC, ITC data show. Exports in the January-April period of 2021 were 34.5% lower, illustrating the continued impact of the February freeze as well as turnarounds and operational issues that have kept US PVC supply tight.

Strong domestic PVC demand also shrinks export volume availability. In addition, domestic PVC demand has remained strong amid a continued housing boom fueled by consumers seeking more space when working from home amid the pandemic.

April 2021 housing starts reached 1.569 million units, according to US Census Bureau data. The year began with 1.625 million units in January, which plunged nearly 11% to 1.447 million units in February because of the freeze. Housing starts jumped 22.5% to 1.733 million units in March, reflecting a catch-up from starts hindered the month prior and retreated 11.5% in April.

PVC is used to make pipes, window frames, vinyl siding and other products.

As MRC reported earlier, Formosa Plastics USA, part of Formosa Petrochemical, left force majeure (FM) on PVC supplies from its plants in North America in force as of 2 June, 2021. And OxyChem, the chemical division of Occidental Petroleum, left FM on PVC shipments from its plants in North America in force as of 2 June, 2021.

According to MR''s ScanPlast report, Russia's overall PVC production reached 346,100 tonnes in the first four months of 2021, down 1% year on year. All producers decreased production volumes over the reported period, with the exception of the Bashkir Soda Company.
MRC

MOSCOW (MRC) -- Crude oil futures slipped during midmorning trade in Asia June 10 on the back of a large build in US product inventories, which cast a shadow of doubt on the optimism surrounding summer driving demand in the region, reported S&P Global.

At 10:38 am Singapore time (0238 GMT), the ICE August Brent futures contract was down 65 cents/b (0.90%) from the previous settle at USD71.57/b while the NYMEX July light sweet crude contract was down 61 cents/b (0.87%) at USD69.35/b.

The Energy Information Administration reported a 5.2 million-barrel draw in US crude oil inventories in the week ended June 4 amid high refining run rates, but market sentiment was bogged down by a large build of 7 million barrels in gasoline stocks and a 4.4 million-barrel build in distillate inventories over the same period.

week ended May 28, US gasoline inventories had risen 1.5 million barrels while distillate inventories increased by 3.7 million barrels, according to EIA data.

"Refiners are pumping out a lot of fuel, operating at 91.3% of their operable capacity. The pickup in crude demand has been solid over the past month, but this week showed a little dip," said Edward Moya, senior market analyst at OANDA, in a June 10 note. "The headline draw of 5.2 million barrels, greater than the expected decline of 2.9 million barrels, but everyone seemed to focus on the surprising massive builds with gasoline and distillate inventories."

The build in gasoline inventories reflected that bullish market expectations after the Memorial Day weekend - typically signaling the start of summer driving season - did not materialize.

However, analysts said the long-term outlook for crude oil remains supported by strengthening fundamentals as economies across the world embark on a rocky path toward a vaccine-led demand recovery.

"Green shoots are emerging in some of the Covid-19 ravage(d) countries as indicated by better economic activity and availability of vaccines," said Avtar Sandu, senior commodities manager at Phillips Futures, in a June 10 note.

As MRC informed earlier, Indian refiners, anticipating a lifting of US sanctions, plan to make space for the resumption of Iranian imports by reducing spot crude oil purchases in the second half of the year. The world"s third-largest oil consumer and importer halted imports from Tehran in 2019 after former US President Donald Trump withdrew from a 2015 accord and re-imposed sanctions on the OPEC producer over its disputed nuclear programme.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 744,130 tonnes in the first four month of 2021, up by 4% year on year. Shipments of all PE grades increased. At the same time, PP deliveries to the Russian market were 523,900 tonnes in January-April 2021, up by 55% year on year. Supply of homopolymer PP and PP block copolymers increased, whereas shipments of PP random copolymers decreased.
MRC

MOSCOW (MRC) -- Gov. John Bel Edwards and ExxonMobil Baton Rouge Refinery Manager David Oldreive announced the company’s final investment decision for more than USD240 million in capital improvements at the ExxonMobil Baton Rouge Refinery, said Hydrocarbonprocessing.

The suite of projects will improve processing capability, increase flexibility for meeting market demand, advance overall site competitiveness and install technology for an expected 10% reduction of volatile organic compound emissions.

The projects will help retain 1,300 existing jobs at the refinery, and ExxonMobil estimates the upgrades will support more than 600 construction jobs on-site over three years. The investment also will provide more than 20 full-time job opportunities for graduates of the North Baton Rouge Industrial Training Initiative, a collaborative program spearheaded by ExxonMobil in 2012 to provide no-cost, fast-tracked industrial craft training for community residents.

"We are delighted with ExxonMobil’s decision to move forward with this important suite of projects,” Gov. Edwards said. “For more than a century, the ExxonMobil Baton Rouge Refinery has fueled the economy of our state and nation. These latest capital upgrades will continue to position the integrated ExxonMobil refinery and chemical complex here in Baton Rouge as one of the world’s most innovative and competitive energy sites."

Project construction is expected to begin later this year. According to Dr. Stephen Barnes, director of the Kathleen Babineaux Blanco Public Policy Center at the University of Louisiana at Lafayette, direct, indirect and induced jobs resulting from project construction will total 2,030 in Baton Rouge by 2023. Direct property tax revenue is projected to reach USD43 million over the life of the project.

“Louisiana and the Baton Rouge community have helped make this suite of projects a reality by offering strong support and the opportunity to collaborate to ensure this investment provides benefit for our citizens and local businesses,” Oldreive said. "Through this investment, we will reduce the facility’s volatile organic compound emissions up to 10% while bringing direct value to the community through increased tax revenue and job opportunities for local residents and small and diverse businesses. ExxonMobil has made significant progress to reduce emissions globally and plans further reductions in greenhouse gas emissions by 2025."

To secure the investment, Louisiana Economic Development provided ExxonMobil with the comprehensive workforce solutions of LED FastStart, ranked the No. 1 state workforce training program in the U.S. for the past 11 years. The company also will utilize the state’s Industrial Tax Exemption Program. In addition to supporting the North Baton Rouge Industrial Training Initiative, ExxonMobil will focus on providing supplier opportunities specifically to North Baton Rouge businesses.

"ExxonMobil is an economic driver in East Baton Rouge, supporting thousands of residents with quality jobs, strategically partnering with local companies for procurement needs, and injecting millions of dollars into public services,” Mayor-President Sharon Weston Broome said. “I am pleased by the news that this investment has been approved, and look forward to seeing the economic return to bolster employment, contribute to our tax base and reinvigorate local businesses."

After a 1909 groundbreaking in Baton Rouge, the ExxonMobil Refinery has grown to be part of a world-scale, integrated refining and petrochemical complex providing fuels, lubricants and wax products to customers around the world.

As per MRC, ExxonMobil has made a new discovery at Longtail-3 in the Stabroek Block offshore Guyana, as the US oil major develops one of the world's most important new oil and gas blocks in the last decade. Exxon operates the 6.6-million-acre Stabroek Block as part of a consortium that includes Hess Corp and China's CNOOC Ltd. It began production at the block in 2019. The company, however, did not specify the size of the latest discovery's oil and gas reserves.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 744,130 tonnes in the first four month of 2021, up by 4% year on year. Shipments of all PE grades increased. At the same time, PP deliveries to the Russian market were 523,900 tonnes in January-April 2021, up by 55% year on year. Supply of homopolymer PP and PP block copolymers increased, whereas shipments of PP random copolymers decreased.

ExxonMobil is the largest non-government owned company in the energy industry and produces about 3% of the world's oil and about 2% of the world"s energy.
MRC