BASF raises September polyalcohol prices in Americas

BASF raises September polyalcohol prices in Americas

MOSCOW (MRC) -- BASF, the world's largest petrochemical company, has announced price increases for select polyalcohols in North and South America, as per the company's press release.

The price rise is effective 1 September 2021 or as contracts allow. No reason for the nominated price hike has been given.

Thus, prices for polycaprolactone, epsilon-caprolactone, and 1,6-hexanediol (HDO) flake will grow by USD0.20/pound (lb) in North America and by USD441/metric ton in South America, it says. The price of 1,5-pentanediol will rise by USD0.15/lb in North America and USD331/metric ton in South America, whereas prices for neopentyl glycol (NPG) and 1,6-HDO molten will go up in North America by USD0.10/lb and in South America by USD220/metric ton.

The various products are used in applications including coatings, plastics, epoxy systems, resins for adhesives and sealants, and high-performance polyurethane, according to BASF.

As MRC reported earlier, Lotte Chemical, a major Korean chemical company, has produced polypropylene (PP) required for medical applications using BASF’s Irgastab, a non-discoloring processing stabilizer. With the rollout of COVID-19 vaccinations worldwide, the need for syringes made from PP has increased exponentially.

According to MRC's ScanPlast report, PP shipments to the Russian market were 727,160 tonnes in the first six months of 2021, up by 31% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased. Supply of statistical copolymers of propylene (PP random copolymers) subsided.

BASF is the leading chemical company. It produces a wide range of chemicals, for example solvents, amines, resins, glues, electronic-grade chemicals, industrial gases, basic petrochemicals and inorganic chemicals. The most important customers for this segment are the pharmaceutical, construction, textile and automotive industries.
MRC

China used crude oil stocks again in July despite slower growth in refining volumes

China used crude oil stocks again in July despite slower growth in refining volumes

MOSCOW (MRC) -- China drew on crude oil inventories in July, marking the fourth consecutive month it has processed more crude that what was available from domestic output and imports, said Hydrocarbonprocessing.

The call on inventories was smaller in July than in the previous two months, but this was more a reflection of weak refinery processing rates rather than any underlying boost to demand. China, the world's biggest oil importer, appears to have taken about 223,700 barrels per day (bpd) from reserves in July, according to calculations based on official data.

The country doesn't disclose the volumes of crude flowing into strategic and commercial stockpiles. But an estimate can be made by deducting the total amount of crude available from imports and domestic output from the amount of crude processed. Refiners processed 59.06 million tonnes in July, a 14-month low and down from a record 60.82 million in June, according to data released on Monday by the National Bureau of Statistics.

Domestic output was 16.87 million tonnes, while imports were 41.24 million, giving a total 58.11 million tonnes of crude available to refiners. Subtracting the crude available from the processing volume leaves a deficit of 950,000 tonnes, which is equivalent to about 223,700 bpd, using standard conversion factors.

The small draw in stockpiles in July followed larger calls on inventories of around 980,000 bpd in June, 589,000 bpd in May and 280,000 bpd in April. China has in recent years been rapidly building up its strategic petroleum reserve (SPR) and commercial stockpiles have also grown as new refineries come online and have to build up working inventories.

However, refiners started to draw on stockpiles in October last year, and have called on inventories in six of the last 10 months. China snapped up large volumes of crude when prices plunged to two-decade lows during the coronavirus pandemic, which coincided with a brief price war between top exporters Saudi Arabia and Russia in March last year.

China imported so much crude in the middle part of last year that it resulted in long vessel queues outside ports, and it struggled to offload the cargoes. Refiners appear to have taken the view that crude oil prices have risen too far too fast as the output restrictions by the OPEC+ group of exporters saw benchmark Brent futures surge some 387% from the pandemic and price war low in April last year to a 2021 high of USD77.84 a barrel on July 6.

Since then crude prices have trended lower, with Brent ending at USD69.51 a barrel on Monday as the market starts to retreat from its bullish view amid the reality of weak demand in China, and much of the rest of Asia as the top-importing region continues to battle the coronavirus pandemic. It's not just high prices that are affecting China's crude oil imports and refinery throughput.

Processing rates at smaller, independent refiners were lower in July as they faced tightening quotas and increased taxes on what is known as bitumen blend, which had been a popular feedstock for some independent refiners. The increased official scrutiny of imports and a renewed coronavirus outbreak in China may serve to keep crude imports and refinery processing muted in August.

However, cheaper crude prices and the emergence of discounts on physical cargoes may be enough to tempt some major refiners to purchase more cargoes, although whether they will resume stockpile builds remains an open question.

As per MRC, China's daily crude throughput last month fell to the lowest since May 2020 as independent plants slashed production amid a tighter quotas, high inventories and weakening profits. Last month's processing volumes were 59.06 million tonnes, or 13.9 million barrels per day (bpd), 0.9% below the same month of 2020, data from the National Bureau of Statistics (NBS) showed on Monday. That was the first year-on-year decline since March last year when coronavirus hammered Chinese fuel demand, and the July level was down 6% from off June's record at 14.8 million bpd.

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 1,176,860 tonnes in the first half of 2021, up by 5% year on year. Shipments of exclusively low density polyethylene (LDPE) decreased. At the same time, PP shipments to the Russian market were 727,160 tonnes in the first six months of 2021, up by 31% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased. Supply of statistical copolymers of propylene (PP random copolymers) subsided.
MRC

CTCI Beijing completes Zhangzhou EPC project

CTCI Beijing completes Zhangzhou EPC project

MOSCOW (MRC) -- CTCI Beijing, a CTCI subsidiary company, has completed the first phase of engineering, procurement, and construction (EPC) of a resin plant owned by Zhangzhou CHIMEI Chemical Company in Zhangzhou, China, according to Hydrocarbonprocessing.

Having reached mechanical completion in May and begun commissioning in July, the first phase is slated to produce 450 kilo-tons per annum of acrylonitrile-butadiene-styrene (ABS) and acrylonitrile styrene (AS).

Commercial operation will begin this September.

TS Zhang, Chairman of CTCI Beijing, says, “This project is another successful cooperation with CHIMEI since 2012. With this project delivered, we helped CHIMEI further consolidate its position in the Chinese market, realizing multiple goals including product line diversification, quality enhancement, and value adding, all so important given its stance as a global leading supplier of ABS. During execution of this project, CTCI Beijing managed to minimize the impact by COVID-19 pandemic and completed the task on time and to quality specifications. At the same time, we have reached a safety record of 6 million man-hours without lost-time injuries. CTCI is committed to delivering follow-up job items fulfilling the brand spirit of being the most reliable engineering services provider.”

The plant’s second phase expansion, which will produce 150 kilo-tons ABS and AS per annum, is now under way and will begin commercial operation in July 2023.

Once the plant comes fully online, it will produce 600 kilo-tons of ABS and AS per annum, becoming a world-leading ABS production base. It will be able to meet the growing ABS demand by local household appliance and motor industries, and will help drive development for up- and downstream businesses.

This is CHIMEI’s second production base in China. The geographical location of the plant at Zhangzhou Gulei Port Economic Development Zone in Fujian Province - one of China’s seven major petrochemical bases - allows quick access to required materials, such as styrene and butadiene, as well as fine utility resources like natural gas, plant air, nitrogen, steam, and wastewater treatment, saving tremendous operation and investment cost.

CTCI has closely worked with CHIMEI in other projects in the past, include ABS, HIPS (high impact polystyrene) and SSBR (solution polymerized styrene-butadiene rubber) EPC projects in Zhenjiang, Jiangsu Province, China. These track records have led to CTCI’s ABS/AS contract award in Zhangzhou.

As MRC reported earlier, in October 2020, Zhangzhou Chi Mei Chemical unveiled plans to build a polystyrene (PS) plant with a capacity of 300,000 mt/year in Zhangzhou (Zhangzhou, Fujian Province, China). The plant will consist of four lines with a capacity of 75,000 mt/year each. It will be located in the Guley petrochemical industry park. The timing of the project is unknown.

CTCI has been providing comprehensive and state-of-the-art engineering services worldwide, and has become a preferred partner for clients across Asia, the Middle East, and the Americas.
MRC

Renewable fuel companies are crowding out some processors

Renewable fuel companies are crowding out some processors

MOSCOW (MRC) -- Both renewable fuel processors and oil refiners are trying to profit off the growing market for sustainable fuel and renewable diesel, but high prices for feedstocks like soybean oil has been more of a hazard for refiners, as their most recent earnings showed, said Hydrocarbonprocessing.

These renewable fuel products are a fraction of overall sales of gasoline, diesel and other products, but it is growing. However, demand has helped cause the prices of the ingredients needed - like soybean oil and animal tallow - to rise sharply. Refiners were forced to put off plans for expansion into renewable fuel production, but competitors who specialize in such fuels were able to shift to processing lower-cost feedstocks.

"We are making sure we are not dependent on one or the other feedstock," said Peter Vanacker, Neste's chief executive, in an interview with Reuters. "In the future it's going to be more and more about margin management." Companies such as Renewable Energy Group Inc, Darling Ingredients Inc and Neste all beat estimates for second-quarter earnings even as refiners crowd into the market.

The companies have more flexibility to switch between feedstocks such as used cooking oil and animal fat to make in-demand renewable diesel, said Dhruv Kharbanda, an associate at investment bank Tudor, Pickering, Holt & Co.

"Darling, Neste and Renewable Energy Group benefitted from feedstock flexibility during the quarter, whereas (CVR Energy) and Marathon highlighted the weak economics of running soybean oil," the bank said in a research note.

Marathon Petroleum, which operates America's second-largest renewable diesel facility in North Dakota that primarily runs soybean oil, called the feedstock's economics "challenged" because the heightened prices coupled with the relatively higher carbon intensity of the oil limits the refiners' ability to profit on production.

Renewable Energy Group's gross profit, meanwhile, rose by more than 400% from a year earlier by processing a higher percentage of lower carbon-intensive materials, said the company's chief executive Cynthia Warner.

As MRC informed earlier, in May, 2021, US refiner Marathon Petroleum Corp said its board had approved the conversion of the Martinez refinery in California to a renewable diesel plant. Besides, the company made a final investment decision regarding this project. Martinez, once complete, will be one of the largest renewables facilities in the country.

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 1,176,860 tonnes in the first half of 2021, up by 5% year on year. Shipments of exclusively low density polyethylene (LDPE) decreased. At the same time, PP shipments to the Russian market were 727,160 tonnes in the first six months of 2021, up by 31% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased. Supply of statistical copolymers of propylene (PP random copolymers) subsided.
MRC

South Korean and Chinese refiners snap up US Mars crude loading in September

South Korean and Chinese refiners snap up US Mars crude loading in September

MOSCOW (MRC) -- South Korean and Chinese refiners have snapped up at least 5 million barrels of US Mars crude loading in September, taking advantage of lower prices in recent weeks, reported Reuters with reference to industry sources.

The purchases could lift in September the volume of US crude loading for Asia, up from a 4-year low in the previous month when strong US crude prices curbed exports, Refinitiv Eikon data showed.

Other grades such as West Texas Intermediate (WTI) and West Texas Light (WTL) that regularly head east are also being booked for Asia, the sources said.

Ongoing production restraint by Middle East producers and a delayed return of Iranian barrels to international markets have also contributed to the rise in Asian buying interest for US high-sulphur crude, they said.

One South Korean refiner has bought 3 million barrels of the sour grade while Unipec, the trading arm of Asia's largest refiner Sinopec, has taken at least 2 million barrels, the sources said.

Unipec has chartered the supertanker Cosnew Lake to load sour crude from Louisiana on Sept. 23, according to two sources and Refinitiv Eikon data. The company is also looking to fix a Suezmax vessel for departure in early September, shipbrokers said. Earlier this week, Taiwanese refiner Formosa Petrochemical Corp had issued a tender to buy Mars crude but did not award it due to high offers.

There are still 2 million to 4 million barrels of Mars crude that have yet to trade and these could potentially come to Asia, said a Singapore-based trader.

"US crude has become quite cheap relative to the rest of the world and U.S. exports have picked up because of it," said Scott Shelton, an energy specialist at United ICAP.

Mars Sour crude's discount to US crude futures widened in late July to the most since April 2020, but has since narrowed due to the rise in export demand, traders said. Mars traded at the smallest discount to benchmark futures in 6 weeks on Tuesday. "We have been seeing sours bid east very aggressively," one U.S.-based source at a top exporter said.

"I think there are still good refinery runs, despite the China COVID noise and SPR stuff," he said, referring to reports about China releasing crude stocks from strategic petroleum reserves (SPR) and concerns about the recent lockdowns in China to curb the coronavirus Delta variant cutting its oil demand.

As MRC wrote earlier, Formosa Plastics Company (FPC), part of Formosa Petrochemical, took off-stream its No. 1 cracker in Mailiao, Taiwan for a scheduled turnaround on 8 June, 2021. This cracker with an annual capacity of 700,000 tons of ethylene and 350,000 tons of propylene is expected to remained shut unitl mid-July, 2021.

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 1,176,860 tonnes in the first half of 2021, up by 5% year on year. Shipments of exclusively low density polyethylene (LDPE) decreased. At the same time, PP shipments to the Russian market were 727,160 tonnes in the first six months of 2021, up by 31% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased. Supply of statistical copolymers of propylene (PP random copolymers) subsided.
MRC