Asian phthalic anhydride producers margins' firmed by USD70-100/tonne

(ICIS) -- Asian phthalic anhydride (PA) producers margins' have firmed by USD70-100/tonne this week, widening for the first time in 18 months because of active restocking, several regional producers and traders said on Friday.

Several Chinese buyers said they are expecting the prices to continue rising in the near term.
⌠Many traders and distributors have cleared their lower-priced inventories, so there are no more low-priced cargoes available, a Chinese buyer said. ⌠The producers will determine the PA spot prices for now, the buyer added.

A northeast Asian producer said it sold 5,000 tonnes of PA late on 15 December at USD1,480/tonne (EUR1,140/tonne) CFR (cost & freight) CMP (China Main Port). Feedstock orthoxylene (OX) prices were assessed at USD1,380-1,410/tonne CFR NE (northeast) Asia on 15 December.
On 9 December, the CFR CMP benchmark of PA was assessed at USD1,380-1,410/tonne, while the CFR NE Asia benchmark of OX was assessed at USD1,380-1,410/tonne.
Producers normally produce PA by using 950kg of OX, hence adding USD100/tonne to their PA prices to cover their conversion costs. In the current firmer market, PA producers' margins have increased by USD54.75/tonne.

The last record of the PA-OX spread moving into positive territory was on 21 May 2010. Regional producers said the prices have increased because Chinese buyers have started to actively restock their inventory, after remaining at the sidelines resulted in tightened inventory. Many Chinese buyers refrained from participating in the PA spot market when the prices declined from mid-September to early December.

MRC

(PlastEurope) -- Masqat-based Octal (Oman) says it is on target to commission its new PET hub in the sultanate's Salalah free zone in May 2012. The new plant will include two DPET production lines, with capacity for 263,000 t/y each, raising Octal's production capacity in Salalah to 927,000 t/y, "making it the largest in the world on site", the company says.

"Additional volumes of resin production will spur the growth of the packaging industry and will encourage markets to migrate from less efficient materials to PET as the preferred clear rigid polymer," said Octal chairman Sheikh Saad Suhail Bahwan.

A completely integrated facility, the Salalah PET hub was designed to yield the lower carbon footprint products, Octal says, adding that the plant uses 67% less electricity to manufacture DPET sheet and 38% less energy in the production of DPET resin. The facility is also able to recycle trim waste during the manufacturing process.

MRC

MOSCOW (MRC) -- An accident at Stavrolen on Thursday brought to a halt its production of petrochemicals. There is no official data on the effects of the accident yet. If the production in Budyonnovsk stops for a long time, it can seriously affect the Russian market of polyethylene and polypropylene, according to MRC analysts.

On Thursday, 14.15 p.m., at the Stavrolen site in Budennovsk there was an explosion followed by a fire outbreak in the work room of gas distribution of ethylene. At the moment there is no official information about the causes and consequences of the explosion for the industrial complex.

Stavrolen plant (Lukoil group) is one of the largest Russian producers of petrochemical products. Capacity for the production of high-density polyethylene makes 300 thousand tonnes per year and production capacity for polypropylene -120 thousand tonnes per year.

The company is the second largest Russian producer of high-density polyethylene after Kazanorgsyntez, and the third by volume of PP production after Nizhnekamskneftechem and Tomskneftechem.

Over the 11 months, Stavrolen produced slightly more than 268 thousand tonnes of HDPE, export shipments, including the countries of the Common Customs Union, made a little more than 29 thousand tonnes. Production volume of polypropylene was about 116 thousand tonnes. The export shipments, including the countries members of the Uniform Customs Union, made more than 25 thousand tonnes.

MRC

(Plastemart) -- Management of Haldia Petrochemicals plans to hive off the proposed Butene-1 extraction plant into a wholly-owned subsidiary, to insulate it from any logjam that HPL may get caught into due to the ongoing ownership dispute, as per The Hindu.
The board of directors, at its meeting on December 12, has okayed the financing of the project, which is expected to boost the company's profitability by Rs.80 crore annually.

Profitability of the 25,000 tpa capacity project stemmed from the fact that with this extraction plant it would be possible to sell a portion of the high-value commodity outside. As of now, it was being used sub-optimally to part feed the polyethylene plant.

MRC

(ICIS) -- The chemical industry in Gulf Cooperation Council (GCC) countries could help drive job creation in the region by working closely together with its governments, a top industry official said on Thursday. ⌠Given the employment challenge, the need for labour-intensive industries is mounting, even if it entails a partial sacrifice of economic returns from the chemical producers, said Abdulwahab Al-Sadoun, general secretary of the GPCA, speaking at the 6th GPCA forum in Dubai.

A large part of the population in the GCC states is under the age of 25 with their percentage of total population ranging from 28% in Qatar to 49% in Saudi Arabia. In the past ten years, the GCC as a whole created 7m job opportunities but only 2m jobs were taken by GCC nationals, according to Al-Sadoun.

⌠The industry's potential for job creation could be realized when GCC governments and regional chemical producers come together to successfully navigate [job creation] challenges, he said.

The extent to which they successfully overcome these challenges will have a direct impact on number of jobs created across the region, not just in the chemical industry but in conversion industries, which will be stimulated by production of new chemical products, Al-Sadoun said.

From the industry perspective, talent management and securing steady talent inflow to the market is key to long-term sustainable growth, he said. Access to diverse and skilled pools of technicians, engineers, managers and support staff is vital for successful industry expansion, according to Al-Sadoun.

The downstream chemicals industry provides greater employment opportunities than commodity chemicals and oil & gas exploration, said Andrew Monro, a partner and global head for petrochemicals at KPMG at the GPCA forum.

MRC