Mitsui Chemicals and SKC to terminate MCNS polyurethanes JV in South Korea

MOSCOW (MRC) -- Mitsui Chemicals Inc. and SKC Co. have announced plans to terminate their Mitsui Chemicals & SKC Polyurethanes (MCNS) joint venture based in Seoul, South Korea, according to Apic-online.

MCNS was established in 2015 to combine the polyurethane raw materials businesses of both Mitsui and SKC. MCNS has operations in both South Korea and Japan.

According to Mitsui, discrepancies have started to arise between Mitsui's policy of steadily improving earnings through the likes of high-performance products and bio-products and SKC's policy of quickly expanding global market in scale, prompting both companies to take a thorough look at how they should be running their operations in this field.

The parties have determined that it would be beneficial for each company to run its own operations in line with its specific strategy, if both companies are to further grow their businesses.

The dissolution is scheduled to occur at the end of December 2021. On 1 Jan. 2022, operations of MCNS-J will relaunch as the Polyurethane Division of Mitsui Chemicals. In March 2022, Mitsui will transfer shares in MCNS to reduce paid-in capital, and the liquidation of MCNS-J will be completed.

As MRC reported earlier, in May 2021, Neste, Mitsui Chemicals, Inc. and Toyota Tsusho Corp. announced they are joining forces to enable Japan’s first industrial-scale production of renewable plastics and chemicals from 100% bio-based hydrocarbons. In this collaboration, Mitsui Chemicals will use Neste RE, 100% bio-based hydrocarbons produced by Neste, to replace a part of the fossil feedstock in the production of a variety of plastics and chemicals at its crackers within Osaka Works during 2021. In doing so, Mitsui Chemicals will become Japan’s first company to use bio-based feedstock in its crackers. The collaboration between Neste, Mitsui Chemicals and Toyota Tsusho will enable brand owners and other potential clients in the Asian market, particularly in Japan, to start incorporating renewable plastics and chemicals into their products and offerings.

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 1,638,370 tonnes in the first eight months of 2021, up by 10% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 989,570 tonnes in the first eight months of 2021, up by 30% year on year. Deliveries of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased, whereas shipments of injection moulding PP random copolymers decreased significantly.
MRC

MOSCOW (MRC) -- Trinseo, a global materials company and manufacturer of plastics, latex binders, and synthetic rubber, and its affiliate companies in Europe, have announced a price increase for plastics, latex binders and synthetic rubber products manufactured in the EMEA, as per the company's press release.

Effective October 27, 2021, or as existing contract terms allow, a surcharge of up to EUR500/mt will apply to the contract and spot prices for all Trinseo products produced in its European facilities.

According to the company's statement, since early 2020, the petrochemical industry has been greatly impacted by both severe disruptions in raw material availability and significant cost increases. Trinseo has worked hard to mitigate the impact of these issues while maintaining our standards of quality service.

However, in the past few weeks, an energy crisis in Europe has led to an unprecedented rise in utility costs and this impacts Trinseo both directly in production and also indirectly through the raw materials and services the company purchases for the manufacturing process. The issue has been escalating rapidly and this jeopardizes Trinseo’s ability to continue with normal production without action.

As MRC reported earlier, earlier this month, Trinseo announced a price increase for all polystyrene (PS), acrylonitrile-butadiene-styrene (ABS) and acrylonitrile-styrene copolymer (SAN) in Europe. Effective October 1, 2021, or as existing contract terms allow, the contract and spot prices for the products listed below rose, as follows:

- STYRON general purpose polystyrene grades (GPPS) -- by EUR55 per metric ton;
- STYRON and STYRON A-Tech and STYRON X- Tech and STYRON C- Tech high impact polystyrene grades (HIPS) - by EUR55 per metric ton;
- MAGNUM ABS resins - by EUR60 per metric ton;
- TYRIL SAN resins - by EUR45 per metric ton.

According to ICIS-MRC Price report, in Russia, October prices of Nizhnekamskneftekhim's GPPS were in the range of Rb152,750-163,700/tonne CPT Moscow, including VAT, and HIPS prices were at Rb156,750-167,700/tonne CPT Moscow, including VAT. Penoplex contracted its GPPS quantities at Rb169,000-171,000/tonne CPT Moscow, including VAT, in October, whereas last week's prices of Gazprom neftekhim Salavat's GPPS were heard at Rb152,500-156,500/tonne CPT Moscow, including VAT.

Trinseo is a global materials company and manufacturer of plastics, latex and rubber. Trinseo's technology is used by customers in industries such as home appliances, automotive, building & construction, carpet, consumer electronics, consumer goods, electrical & lighting, medical, packaging, paper & paperboard, rubber goods and tires. Formerly known as Styron, Trinseo completed its renaming process in 1Q 2015. Trinseo had approximately USD3.0 billion in net sales in 2020, with 17 manufacturing sites around the world, and approximately 2,600 employees.
MRC

1. Crude oil prices extend gains on tight global supply and stronger fuel demand as economies recover from pandemic

MOSCOW (MRC) -- Oil prices extended pre-weekend gains on Monday to hit multi-year highs, lifted by tight global supply and strengthening fuel demand in the United States and beyond as economies recover from pandemic-induced slumps, reported Reuters. Brent crude futures rose by USD1.10, or 1.3%, to USD86.63 a barrel by 1406 GMT, the highest since October 2018. US West Texas Intermediate (WTI) crude futures rose USD1.46, or 1.7%, to USD85.22 and reached their highest level since October 2014. Both benchmarks closed last week with slight gains despite rising coronavirus cases in Britain and Eastern Europe, signaling a potentially difficult winter ahead.

MRC

MOSCOW (MRC) -- Crude oil futures inched lower in mid-morning trade in Asia Oct. 26 amid reports of talks this week between Iran and the EU, opening the possibility of an eventual return of Iranian oil to global oil markets, reported S&P Global.

At 10:10 am Singapore time (0210 GMT), the ICE December Brent futures contract was down 4 cents/b (0.05%) from the previous close at USD85.95/b, while the NYMEX December light sweet crude contract dipped 11 cents/b (0.13%) to USD83.65/b.

Tehran's top nuclear negotiator Ali Bagheri Kani said in a tweet late Oct. 25 that he will be meeting with his EU counterpart Enrique Mora in Brussels on Oct. 27 to revive the country's stalled 2015 nuclear talks.

This follows an initial round of discussions between the EU and Iran held in Tehran on Oct. 14.

A deal will potentially bring back at least 1.3 million barrels of Iranian oil, according to some analyst estimates, helping to ease a severe shortage of oil at a time when the world needs it going into winter season.

"Prices gave up gains following reports that the EU will hold discussions with Iran later this week," said ANZ Research analysts in a note.

Nonetheless, analysts at ING said markets will likely take a cautious approach toward the talks.

"There is plenty of uncertainty around the timing and how talks will evolve. The market will likely take a more cautious approach in terms of pricing in the potential for a deal, given how talks broke down over the summer," ING's Warren Patterson and Wenyu Yao said.

"We are forecasting in our balance sheet that Iranian oil output will end 2022 around 1.3 million b/d higher than where it starts the year, but clearly this assumes a lifting of sanctions," they said.

In the near term, investors will be looking at US oil inventory data for a gauge of oil demand.

As MRC informed before, US commercial crude stocks fell 3.48 million barrels to 413.96 million barrels in the week ended Sept. 17, to more than 8% below the five-year average, Energy Information Administration data showed. Stocks were last lower Oct. 5, 2018.

We remind that in late August, 2021, US crude stocks dropped sharply while petroleum products supplied by refiners hit an all-time record despite the rise in coronavirus cases nationwide, the Energy Information Administration said. Crude inventories fell by 7.2 million barrels in the week to Aug. 27 to 425.4 million barrels, compared with analysts' expectations in a Reuters poll for a 3.1 million-barrel drop. Product supplied by refineries, a measure of demand, rose to 22.8 million barrels per day in the most recent week. That's a one-week record, and signals strength in consumption for diesel, gasoline and other fuels by consumers and exporters.

We also remind that US crude oil production is expected to fall by 160,000 barrels per day (bpd) in 2021 to 11.12 million bpd, the US Energy Information Administration (EIA) said in a monthly report, a smaller decline than its previous forecast for a drop of 210,000 bpd.
MRC

MOSCOW (MRC) -- At least 25 people, including some minors, were killed in an explosion and fire at an illegal oil refinery in Nigeria's Rivers state on Friday, a local leader and a resident told Reuters on Sunday.

"The casualties involved are very high ... we are counting 25 bodies," Ifeanyi Omano, a community leader, told Reuters, adding: "We aren't certain of their identities yet," he said, adding that the dead included some minors.

Omano and local resident Chikwem Godwin said the explosion took place in the early hours of Friday, adding people from several communities were killed. A local police spokesman previously confirmed the incident but did not disclose the numbers of casualties.

Illegal refining is common in the oil-rich Delta region of Nigeria as impoverished locals tap pipelines to make fuel to sell for a profit. The practice, which can be as basic as boiling crude oil in drums to extract fuel, is highly dangerous.

Nigeria is Africa's largest oil exporter.

As MRC informed earlier, in August 2021, gunmen killed a police officer and six employees of a Nigerian oil and gas services contractor during an attack on buses transporting workers to a Shell project site in the southeastern state of Imo, Nigeria. Attacks on oil and gas facilities have long been a problem in Nigeria, where the multi-billion dollar industry sits alongside impoverished communities that have seen little benefit from it. In this case, the motive was unclear.

We remind that Royal Dutch Shell plans to reduce its refining and chemicals portfolio by more than half, it said in July 2020 without giving a precise timeframe. The move is part of the Anglo-Dutch company's plan to shrink its oil and gas business and expand its renewables and power division to reduce greenhouse gas emissions sharply by 2050.

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 1,638,370 tonnes in the first eight months of 2021, up by 10% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 989,570 tonnes in the first eight months of 2021, up by 30% year on year. Deliveries of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased, whereas shipments of injection moulding PP random copolymers decreased significantly.
MRC