Japan's Marubeny, Kazakhstan sign MOU to develop chem. projects

SINGAPORE (ICIS)--Marubeni Trading Corp has signed an agreement with Kazakhstan's national chemical firm United Chemical Company (UCC) to study and develop a series of chemical projects in the central Asian country, the Japanese trading firm said on Friday.

⌠By concluding [the] Memorandum of Understanding (MOU) for Cooperation, both UCC and Marubeni acknowledge each other as strategic partners and will jointly proceed with study and development of a series of chemical projects, the company said in a statement.
The MOU between the two firms was signed on 6 October this year, the company said.

⌠Marubeni will contribute to the development of chemical industry in Kazakhstan by utilizing several functions such as investment, finance, products off-taking and plant construction, it added.
UCC was established in 2009 to develop the chemical industry in the oil and gas rich country, according to Marubeni.

MRC

HOUSTON (ICIS)--US propylene contract prices for October settled down 14 cents/lb from September, market participants said on Thursday.
Market participants earlier this week predicted a substantial drop in propylenecontract prices as a result of a build-up in refinery grade propylene (RGP) inventories.

The settlement brings the polymer-grade propylene (PGP) contract down to 64 cents/lb ($1,411/tonne, ┬1,058/tonne) and chemical-grade propylene (CGP) down to 62.50 cents/lb.
RGP accounts for 60% of the US propylene market. The product traded last week as low as 55 cents/lb, down from 64 cents/lb a week earlier.
RGP bids were heard as low as 45 cents/lb on Wednesday.

US propylene contracts usually settle near the beginning of the month to which they apply.
US propylene contracts for September rolled over from August in a settlement that kept polymer-grade propylene (PGP) at 78.00 cents/lb and chemical-grade propylene (CGP) at 76.50 cents/lb.
Major US producers of PGP and CGP include Chevron Phillips Chemical, Enterprise Products,ExxonMobil, LyondellBasell, Petrologistics and Shell Chemical.
The main buyers include Dow Chemical, INEOS, Ascend Performance Materials and Total.

MRC

(China in the news) -- China last year overtook Europe as the world's largest producer of plastics, with the eurozone slump continuing to deepen the divide, a recent study shows.
According to the report carried out on behalf of the industry's trade association, Plastics Europe, a two-percent cut in European plastics jobs and continued company closures meant that the old continent lost its pole position to China.

"The European Union has traditionally been an important net exporter of plastics and plastic products. This trade balance grew by over 100 percent between 2000 and 2010, reaching a total trade surplus of ┬15.7 billion in 2010. Despite a shrinking workforce and losing the number-one production position to China, the European plastics industry continues to be a key contributor to EU trade surplus," the report reads.

Europe accounted for 57 million tonnes (22 percent) of the global consumption last year, while China claimed 23.5 percent of the world production of plastics. But the Asian country also continued to import plastic raw material from Europe.
In a positive development, the amount of recycled and recovered plastics in 2010 increased by an average 9.3 percent year on year across the 27 EU countries, Norway and Switzerland. This figure is equal to 58 percent of all used plastics.

"The recycled quantity increased by 8.7 percent thanks to stronger activity from citizens, packaging collection schemes and recycling companies," the report notes, adding that the use of plastics in energy recovery also increased by almost ten percent.
One of the most dreaded plastic products for the environment - the ubiquitous plastic bag - is far from being on the decrease and the EU is now reviewing whether it should lift dumping restrictions on Chinese and Thai exporters. The measure was imposed in 2006 in order to protect European plastic bag producers such as France's Groupe Barbier and Spain's Plasbel.


When imposing the anti-dumping duties five years ago, the EU said Chinese and Thai exporters increased their combined share of the EU plastic-bag market to 18 percent in the 12 months through March 2005 from 14 percent in 2001.


MRC

SINGAPORE (ICIS)--PVC Malaysia is considering shutting its 150,000 tonne/year polyvinyl chloride (PVC) plant at Kerteh in Terrenganu state within this week, a source close to the company said on Wednesday.

The producer is facing mounting inventory pressure on the back of lacklustre PVC demand, the source said.
The PVC unit is currently operating at low rates of 20-30%, the source said.
If the shutdown plan pushes through, the facility will be kept off line until market situation improves, the source said.

PVC prices were last assessed by ICIS at $940-950/tonne (┬705-713/tonne) CFR (cost and freight) SE (southeast) Asia on 30 September, down by $40-50/tonne from the previous week, according to ICIS.
PVC Malaysia is a subsidiary of Malaysia's state-owned firm, PETRONAS.

MRC

MRC - A group of deputies of the Verkhovna Rada has introduced in parliament committee the bill N 9241 from Oct 04, 2011 to amend the law "On Customs Tariff of Ukraine" in order to increase import duties on PVC-S to 5%, according to MRC analysts.


The changes deal with the introduction of import duty on virgin PVC (FEACN code 3904 10 00 00) to 5% with the aim to develop domestic chemical industry, create the conditions to strart production of new chemical raw materials and their processing, domestic producers support and increase of the inpayments to the state budget.

Previously, MRC analysts expected that the list of goods subject to import duty to be introduced can enter HDPE and PVC-S, as well as other products of the polymer group. Economically reasonable level of import duty, according to MRC analysts could be 6.5%, since it agreed with WTO requirements.

This law project plans to implement the import duties on Jan 1, 2012. According to the financial and economic bill grounds, the introduction of 5% fee will bring only in 2012 more than USD 3 mln of additional income to the Ukrainian state budget. The adoption of the project is expected to satisfy domestic producer demand for virgin PVC, increase loading capacity and reduce import dependence.

The explanatory note to the bill predicts following economic figures for the Ukrainian PVC market in 2012: production - 285 KT, import - 55 KT, export - 175 KT, consumption - 160 KT.

Before this year May, Ukrainian converters were completely dependent on PVC imports from Europe and the USA. Following last year results, PV-S imports made 125.2 KT, PVC-E - 28.6 KT. Over the eight months, these figures were 85.6 KT and 21.42 KT respectively.

In May, Karpatneftechem launched a new PVC-S production of 300 KT/year capacities . The investments in PVC production complex made USD 234 mln. Over less than five months the total PVC-S production in Ukraine has exceeded 53.6 KT.



By: MRC analyst, Sergey Karaychentsev.

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