Petrochemical producers in Thailand unlikely to be impacted LPG levy

(Plastemart) -- Petrochemical operators in Thailand are unlikely to feel much effect from the policy to collect Bt1 per kilogram of LPG (liquefied petroleum gas) sales for the Oil Fund, as per The Nation. It is unclear whether users of LPG as feedstock, not as fuel, will be required to pay this contribution to the Oil Fund. It is expected that the Energy Ministry will meet Thai petrochemical producers to discuss the policy in detail before its implementation in January. The levy decision was resolved by the National Energy Policy Council last week to reduce the burden of importing LPG.

Even PTT Chemical, with annual demand of 400,000 tons of LPG, will face minimal impact from the levy. This is because of its planned merger with PTT Aromatics and Refining (PTTAR), one of the suppliers of LPG to PTTCH, which will allow the company to use LPG as feedstock internally without purchasing it.

MRC

(Plastemart) -- Purnendu Chatterjee promoted The Chatterjee Group plans to acquire West Bengal government's 45% stake in Haldia Petrochemicals (HPL), to become its largest shareholder with management and control. It is already the second largest shareholder with about 41% stake in HPL. As per Times of India, this move follows the path paved by the Supreme Court for divestment of state government's stake in the petrochemical firm with annual sales of Rs 10,000 crore. The government has appointed SBI Caps to do a valuation of the firm.

"We have got our right of first refusal and will exercise it to retain management and control of the firm. We are in talks with the government and are optimistic that the government will take a right decision in this case protecting interests of both the parties ," as per Anirudha Lahiri, President & CEO, TCG.

MRC

(ICIS) -- US expandable polystyrene (EPS) prices lost ground this week, slipping with the price of feedstock benzene, sources said on Tuesday. US EPS prices were assessed by ICIS at 87-94 cents/lb ($1,918-2,072/tonne, ┬1,400-1,513/tonne) DEL (delivered) for block and package material, down by an average of 4 cents/lb from prices at the end of September. The prices slid along with feedstock values in October, including benzene prices, which fell by 68 cents/gal, sources said.

"We are seeing raw material costs come off, and it makes sense that when it does that that we need to be a little responsive," said one producer, who added prices had fallen by 3-5 cents/lb since September.

Although suppliers will not realise most of the savings in feedstock costs until November, sources said competitive situations among producers helped push prices lower for October.

Buyers, who agreed that prices were down 3-5 cents/lb, said the price dip was not enough to encourage inventory building, particularly with the prospect of prices falling further.


MRC

(ICIS) -- The International Energy Agency (IEA) on Wednesday revised down its global oil demand growth forecast for 2011 by 50,000 bbl/day and by 210,000 bbl/day for 2012 because of a downward adjustment to GDP growth assumptions. Global oil demand in 2011 is now expected to rise 1.1% - or by 1.0m bbl/day compared with last year - to 89.2m bbl/day. In 2012, demand will rise 1.4% - or by 1.3m bbl/day - to reach 90.5m bbl/day.

The IEA also cited lower-than-expected third-quarter readings in the non-OECD (Organisation for Economic Co-operation and Development) nations as a reason for the downward revision.
⌠Stronger-than-expected OECD monthly submissions, primarily in Europe and the Pacific, provide some offsetting support, the Paris-headquartered international agency added.

⌠Some of the demand boost stems from temporary factors, such as seasonal heating oil tank filling, while oil-fired power generation in Japan provides more lasting upside potential.

According to the IEA's October oil market report, global oil supply fell by 300,000 bbl/day to 88.7m bbl/day in September from August, driven lower by reduced non-OPEC output.

Non-OPEC supply fell by 300,000 bbl/day to 52.6m bbl/day in September, largely because of weather- and maintenance-related shut-ins in North America, the North Sea and Latin America, as well as unplanned outages in the Middle East, the IEA added.

MRC

(ICIS) -- Widespread flooding in Thailand will shave the country's economic output this year, slowing its GDP growth by as much as a full percentage point, given the heavy disruption caused on domestic production, industry sources and analysts said on Wednesday. The Thai capital of Bangkok is on high alert as floodwaters from the central provinces could break through the protective barriers built around the city, they said.

In the provinces of Uthai Thani, Chai Nat, Sing Buri, Ang Thong, Suphan Buri, Ayutthaya, Pathum Thani and Nonthaburi, heavy rains caused rivers to overflow, with the water rushing where Bangkok lies.

Considered as Thailand's worst in 50 years, the floods have swept across 60 of the country's 77 provinces over past two months, killing at least 281 people and shutting down production at hundreds of factories, according to media reports.

The Thai economy is forecast to grow at 3.5% in 2011, barely half the pace of expansion recorded last year, according to the International Monetary Fund's latest World Economic Outlook report in September.

With the devastation being wrought by the flooding, the projected slow GDP growth could be shaved by 0.6-0.9%, with the losses likely to be as high as baht (Bt) 80bn ($2.58bn), according to estimates of government agencies.

Thailand is expected to sustain huge damage to its agricultural sector, estimated at Bt54bn ($1.7bn), according to DBS Vickers. For industries, the losses are forecast at Bt20bn; Bt9.8bn for trade, and; Bt5.7bn for tourism, the brokerage said.

MRC