Yips Chemical sells 51% stake in Handsome Chemical

Yips Chemical  sells 51% stake in Handsome Chemical

MOSCOW (MRC) -- Yip’s Chemical said that it has signed an agreement to sell a 51% effective interest in Handsome Chemical, a subsidiary of its solvents business, to investment firm PAG for around Chinese yuan (CNY) 2.3bn, said the company.

Solvents producer Handsome Chemical will leverage its partnership with Hong Kong-based PAG to construct a 600,000 tonne/year acetic acid plant at Jingmen Chemical Recycling Industrial Park in Hubei, China, it said in a statement. The project is expected to cost around CNY1.74bn.

"The added capacity of acetic acid production will ensure the sufficient supply of raw materials for Handsome Chemical, and also allow for flexible operations by adjusting the amount of acetic acid consumed internally or sold to the market," it said.

We remind, Jiangmen Handsome Chemical Development has commissioned its new 200,000 tonne/year ethyl acetate (etac) plant at Taixing in Jiangsu province, after achieving stable operations during a trial run. The producer has also closed its older, 120,000 tonne/year etac plant at Taixing, as planned. This means a net etc capacity increase by 80,000 tonnes/year. Meanwhile, Jiangmen is continuing to run its 60,000 tonne/year butyl acetate (butac) plant at Taixing. At Jiangmen in the southern province of Guangdong, Jiangmen Handsome operates a plant that can produce 300,000 tonnes/year of etac and 120,000 tonnes/year of butac.

Handsome Chemical is the world's largest acetate solvents producer, with an annual production capacity of more than 1.6m tonnes, according to Yip's Chemical. Handsome Chemical will source carbon monoxide, one of the key feedstocks for acetic acid, from Yingde Gases, part of PAG-controlled AirPower Technologies Group, China’s largest supplier of industrial gases, which is also located in Jingmen Park. The strategic gas supply agreement between the two parties is expected to be finalised in the coming weeks.

Yip's Chemical Holdings Ltd. operates as an investment holding company, which engages in the production and selling of petrochemical products. It operates through the following segments: Solvents, Coatings, Inks, Lubricants and Properties. The Solvents segment engages in the manufacturing and trading of solvents and related products such as ethyl acetate, butyl acetate, ethanol, and thinners.

Global gasoline cracks collapse, blow to refiners profits

Global gasoline cracks collapse, blow to refiners profits

MOSCOW (MRC) -- A sudden crash in global gasoline prices in the past two weeks has dented refiners' profits, pushing up inventories in key trading hubs around the world while looming exports from China and India also add to pressure on growing stockpiles, said Reuters.

Refiners will be forced to cut gasoline output to safeguard themselves against losses and switch to producing more profitable fuels, traders say, but summer demand is also being hurt by high pump prices in the United States and Europe, and by instability and easing seasonal demand in some parts of Asia.

This has led to a rise in inventories from Singapore to Amsterdam-Rotterdam-Antwerp and the United States, according to traders, analysts and inventory data. Asia's top fuel exporter Taiwan's Formosa Petrochemical Corp could reduce operating rates at their residue fluid catalytic cracking (RFCC) units, which are now running at full capacity, by 5% in the coming weeks.

"We will sell more VLSFO (very low sulphur fuel oil) because their margins are better," Formosa's spokesperson K.Y. Lin told Reuters. VLSFO can be used as a feedstock for RFCC units to produce gasoline or sold as marine fuel. Asian gasoline margins have plunged more than 102% in July to a discount of 14 cents a barrel to Brent crude after hitting a record at a premium of USD38.05 a barrel in June, Refinitiv data showed. They are also at the lowest for this time of the year since at least 2000.

That has depressed Asian refining margins to 88 cents a barrel over Dubai crude on Monday, tumbling from a record USD30.49 in June. Chinese state refiners are expected to raise refinery runs in August-September and increase exports to lower high domestic stocks after receiving new quotas, industry sources said.

One of the sources estimated national crude throughput could claw back to 14 million barrels per day or higher, after staying under that level for most of the past 12 months partly because of COVID-19 lockdowns. India's gasoline exports could rise by 15,000-20,000 bpd, bringing August and September exports to an average of 260,000 bpd, consultancy FGE estimates, following the removal of gasoline export duty last week.

Meanwhile, first-half July gasoline imports into Asia dropped 240,000 tonnes from second-half June levels led by Indonesian declines, Asia's largest gasoline importer, FGE said in a note. In Sri Lanka and Pakistan, demand has been hit by economic and political turmoil, further exacerbating the thinning of regional margins, traders said.

FGE expects Asian gasoline demand, excluding China, to improve only marginally between July and September, averaging 80,000 bpd lower than levels seen during the same period in 2019, as high retail prices weigh on demand.

As per MRC, The U.S. Chemical Production Regional Index (U.S. CPRI) eased by 0.1% in June following gains of 0.5% in May and 1.0% in April. Chemical output was mixed across regions. The U.S. CPRI is measured as a three-month moving average (3MMA). On a 3MMA basis, chemical production within segments was mixed in June. There were gains in the production of synthetic rubber, industrial gases, coatings, manufactured fibers, synthetic dyes and pigments, adhesives, other organic chemicals, crop protection chemicals, other specialty chemicals, and fertilizers. These gains were offset by lower production of plastic resins, organic chemicals, and consumer products.

Sinopec outbid for Russian ESPO crude in July

Sinopec outbid for Russian ESPO crude in July

MOSCOW (MRC) -- China's Sinopec Corp has cut its purchases of Russia's ESPO crude oil in July as other buyers, including from India, were willing to pay higher prices, as per Reuters.

A pull-back in Russian oil purchases by Sinopec, Asia's biggest refiner, suggests that its earlier buying was driven by economics rather than political considerations. Chinese and Indian oil companies have increased their Russian oil imports in May and June despite Western sanctions on Russia as a result of the Ukraine conflict that have upended the global oil trade.

China has refrained from condemning Russia's invasion of Ukraine that started on Feb. 24, which Moscow calls a "special military operation", and in a meeting on Feb. 4 the leaders of the two countries said their friendship had "no limits".

Sinopec, through its trading arm Unipec, is expected to lift fewer cargoes in July after submitting lower bids to Russian exporters who then sold the cargos to trading companies and other Chinese clients that bid higher, said four sources who participate in the market and declined to be identified.

Sinopec had been the biggest buyer of ESPO, which loads from the port of Kozmino in Russia's Far East, in the past two months, snapping up an estimated 20 MM barrels, according to traders and data from tanker tracker Vortexa Analytics.

Sinopec bid at discounts of about USD20 a barrel below the price of Middle East benchmark Dubai on a free-on-board basis for July shipments, similar to what it paying for cargoes in May and June, while deals were done at USD8 to USD13 discounts, the sources said.

"Sinopec may only lift a very small amount as their bids were too low for the Russians," said one of the four sources, a China-based trading executive. A Sinopec spokesman declined to comment on the company's purchases.

The companies that beat out Sinopec for the ESPO cargoes in July include Dubai-based trader Coral Energy, state-owned companies CNOOC, PetroChina, and Shandong Port International Trade, which is backed by the local provincial government, according to three trading sources and data from Vortexa. Russia is expected to raise its ESPO exports from Kozmino to a record of 880,000 barrels per day (bpd) in July, Reuters reported on June 7, from an average of 750,000 bpd in 2022.

As per MRC, BASF and Sinopec are further expanding their joint Verbund site in Nanjing, China. It is manufactured by BASF-YPC Co., Ltd. (BASF-YPC), a 50:50 joint venture between the two companies. The capacities of several downstream chemical plants will be expanded for the growing Chinese market. This also includes the construction of a new tertiary butyl acrylate plant.

Dow and Valoregen collaborate to build largest hybrid recycling site in France

Dow and Valoregen collaborate to build largest hybrid recycling site in France

MOSCOW (MRC) -- Materials development specialist Dow has announced an agreement with French recycling company Valoregen to contribute to building the largest single hybrid recycling site in France, said the company.

Authorised by the classified installation for the protection of the environment (I.C.P.E. - Installation Classee pour la Protection de l’Environnement), the site is to be owned and operated by Valoregen. The collaboration is part of Dow’s commitment to working with partners to invest in innovative new recycling solutions, accelerate circularity and tackle waste plastics.

Fabrice Digonnet, Mechanical Recycling Strategy Leader for Dow Packaging & Specialty Plastics, said: “We are delighted to work with Valoregen on this innovative new project that can help give recycling in Europe a real boost. Recycling rates for plastics are still far too low and we need to help scale the technology and ensure a viable market for plastics waste. Our investment will help increase mechanical recycling rates and, in doing so, help accelerate a circular economy for plastics and reduce carbon emissions."

The project, expected to be operational and delivering recycled materials early next year, will mark an important step in bringing together mechanical and advanced recycling processes. Both processes are complementary and essential to Dow’s commitment to incorporate at least 100,000 tonnes of recycled plastics in its product offerings sold in the European Union by 2025.

Thierry Perez, President of Valoregen, added: “Our committed team has developed a concrete, agile solution that contributes to the circular economy of plastics and advances decarbonisation. This next generation solution will achieve recycling for high-end technical packaging applications. We are delighted to work so closely with Dow towards circular solutions."

The plant aims to increase energy efficiency by enabling a higher yield output, minimising waste and reducing the overall carbon emissions produced from these processes. Dow will be the main recipient of post-consumer resins, which it will use to develop new plastic products marketed under Dow’s REVOLOOP product range. It will also provide significant expertise in recycling technology to Valoregen to support the development of its capabilities.

As per MRC, Dow has signed a memorandum of understanding (MoU) with Chinese food and beverage firm Want-Want for zero-solvent emissions and to develop a circular economy for flexible packaging, said the company.

We remind, Dow, recycler KW Plastics of Troy, Alabama; molder Core Technology Molding Corp. of Greensboro, North Carolina; and sustainable golf company Evolve Golf of Wilmington, North Carolina, collaborated to reuse high-density polyethylene (HDPE) plastic mesh fencing from the previous year’s GLBI in the form of 20,000 ball markers and 5,500 divot tools for this year’s event.

Swiss reported that its first-half net profit

Swiss reported that its first-half net profit

MOSCOW (MRC) -- Swiss specialty chemical company Sika AG reported that its first-half net profit after taxes grew 21 percent to 598.8 million Swiss francs from last year's 494.7 million francs, said the company.

Earnings per share were 3.76 francs, up 20.5 percent from 3.12 francs a year ago. Operating profit or EBIT grew 22.7 percent to 841.9 million francs. EBIT margin was 16 percent. Operating profit before depreciation or EBITDA grew 19.5 percent to 1.04 billion francs.

The first-half net sales were at 5.25 billion francs, a growth of 18 percent from 4.45 billion francs last year. Sales went up 19.5 percent in local currencies. Looking ahead for fiscal 2022, Sika continues to expect sales to rise by well over 10 percent in local currencies - surpassing 10 billion francs for the first time - and is anticipating an over-proportional increase in EBIT.

Further, Sika confirmed its 2023 strategic targets, with focus remaining on long-term success and profitable growth. Sika is seeking to grow by 6 percent-8 percent per year in local currencies up to 2023. Since 2021, the company is aiming to record an EBIT margin in the range of 15 percent-18 percent.

As per MRC, Sika is opening a new manufacturing plant for concrete admixtures in Stafford, Virginia, USA to help meet demand in the Northeast and Mid-Atlantic regions. According to the company, the new plant is well positioned to support the addiitonal needs of the announced infrastructure programme of CHF200-250bn (USD209-216bn) in these two regions. The new facility in Stafford will be the second-biggest manufacturing plant for Sika concrete admixtures in the USA.