Mitsubishi Chemical to sell triacetate fiber business to GSI Creos Corp

Mitsubishi Chemical Group Corp has reached an agreement to sell its triacetate fiber business to GSI Creos Corp (Tokyo), said the company.

Financial details of the transaction were not disclosed. Deal is expected to close in March 2025. Mitsubishi Chemical said that triacetate fiber is a man-made cellulose fiber made from natural pulp and is produced exclusively by the company worldwide.

“The material is highly regarded in apparel markets in Japan and abroad for its material characteristics and a certain level of demand growth is expected and the decision to transfer this business was based on the determination that growing the business sustainably under the best owner would be optimal,” it added.

In May 2024, Mitsui Chemicals announced plans to restructure its business. Other Japanese chemical companies, Mitsui Chemicals and Resonac Holdings, have also warned of upcoming asset sales.

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Russia's petrochemical giant Sibur plans to place domestic bonds before the end of the year to fund the Amur gas and chemical complex (GCC), Chief Executive Mikhail Karisalov said on Friday, but stopped short of revealing its size, said Hydrocarbonprocessing.

The Amur complex in Russia's far east is a joint venture with China's Sinopec due to start in 2027, becoming one of the world's largest producers of polyethylene and polypropylene. "We are preparing for the bond issue and are at the advanced stage," Karisalov said on the sidelines of the Eastern Economic Forum in the Pacific port of Vladivostok.

More than half of the plant has been built, Sibur's management member Darya Borisova said this week. Its cost had been put at more than USD10 B, but Karisalov said earlier this year that the project had become slightly more expensive.

The project financing scheme initially consisted of 70% loan funds and 30% shareholder investments.

The Amur GCC is expected to produce 2.3 MMtpy of polyethylene and 400,000 tpy of polypropylene, processing gas fractions from Gazprom's gas processing plant, which is also called Amur.

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Eni SpA (Rome) and Azerbaijan’s state energy company Socar (Baku) have signed a memorandum of understanding (MOU) for potential cooperation in the biofuels production chain, including the possible conversion of conventional crude oil refineries into biorefineries, said the company.

A schedule for potential projects was not given. The companies announced the signing of the MOU on Sept. 5 as part of a wider series of upstream oil and gas and greenhouse gas emission reduction agreements signed during a state visit to Italy by Azerbaijan’s President Ilham Aliyev.

The MOU covers the evaluation of development projects in Azerbaijan and the wider Caucasus region for energy crops located on degraded soil, the introduction of secondary crops in rotation with cereals, and the valorization of agro-industrial and other residues such as used vegetable oils. The latter is with a “view to a possible conversion of traditional refineries into biorefineries,” Eni said.

Azerbaijan will host the next UN Climate Change Conference, or COP29, in November this year.

We remind, the State Oil Company of Azerbaijan (Socar) and Tatneft may create a joint venture for the production of lubricants.

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The European chemical industry’s output grew sequentially in the second quarter of 2024 for the fourth consecutive quarter, with production 1.2% higher than in the first quarter of the year, according to the most recent Chemical Monthly Report by the European Chemical Industry Council (Cefic), said Chemweek.

On a year-over-year basis, output increased by 4.3%; however, given the lack in demand growth, the European chemical industry production volumes are still not completely recovering, Cefic said, adding that production of the European chemical industry seems to have reached its ultimate low in the second quarter of 2023.

“Demand is weak. Incoming orders decline as downstream industry in Europe remains weak,” according to Cefic. Managers’ opinion on the current level of overall order books decreased slightly in July 2024, due to the lack of demand, Cefic said. However, destocking ended in March, and July is the fourth consecutive month showing an upturn in the stock level after six months of decline, it said.

Capacity utilization declined slightly to 75.2% in the second quarter of this year, down from 75.6% in the first quarter, Cefic said. This is, however, far below the long-term average of 81.4%, it added.

The European chemical industry needs to operate profitably, Cefic noted. Some chemical companies in Europe are planning “significant staff cuts in the next few months,” Cefic said, citing survey results from the Institute for Economic Research (IFO; Munich).

In the first half of 2024, the chemical industry was one of only three industries in Europe to post a year-over-year increase in production, up 3.4%, according to Cefic’s analysis of Eurostat data. Paper, with a growth of 3.5%, and food and beverage, with a growth of 2.0%, were the other two.

“A strong recovery of the chemical production in 2024 is unlikely when most of the chemical industry’s downstream users — automotive, rubber & plastics, construction, computer production — are still showing downward trends. The construction and automotive markets are still struggling; in particular, there are concerns for possibly low production and demand levels in the second half of 2024 and 2025 for cars and electric vehicles,” Cefic said.

Lithuania, Poland and Greece posted the highest output growth in the first half of 2024, at 16.3%, 12.8% and 10.5%, respectively. Meanwhile, Europe’s largest economies started 2024 “better than expected,” with Spain, Germany and Belgium achieving the highest increases in production among them, at 6.6%, 4.9% and 4.3%, respectively, Cefic said.

European chemical exports declined by 2.9% on a year-over-year basis to €113.8 billion in the first half of 2024 from €117.2 billion in the same period of 2023. Imports decreased by 11.9% from €101.1 billion in the first half of 2023 to €89.0 billion in the first half of 2024. As a result, Europe’s chemicals trade surplus in the first half was 54% higher year over year, at €24.8 billion.

“Europe would benefit from a strong economic recovery of China and a continued decrease of energy prices [recorded for both crude oil and natural gas]. These would stimulate the recovery of the European economy in the mid-term, and particularly of the energy intensive sectors and their customer sectors,” Cefic said.

In August, the business activity index (PMI) for Russia's manufacturing industries fell to 52.1 points; in July, it reached 53.6 points.

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A recent fire at a major Moscow refinery will not lead to fuel shortages in the region as production from other refineries would compensate for the temporary disruption, Interfax news agency reported on Thursday citing Russian Energy Minister Sergei Tsivilev.

Gazpromneft's SIBN.MM Moscow refinery suspended operations at combined refining unit Euro+, that includes crude distillation unit CDU-6, after a fire on Sunday, three sources told Reuters.

The Moscow refinery in the southeast of the Russian capital was hit in a recent drone attack on Sept. 1, when Ukraine was also targeting Russia's power plants.

In October 2023, Gazprom will begin the first stage of construction on Sakhalin of a plant for the production of aviation kerosene, gasoline and diesel fuel from gas condensate and oil.

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