SCG-DOW Group Achieves Successful Thailand HPPO Plant Start-up

(dow) --The Dow Chemical Company announced that the SCG-Dow Group, a joint venture between Dow and Siam Cement Group, has finalized the start-up of its new propylene oxide (PO) facility in Thailand by successfully completing its full capacity performance test.

Dow reached a key milestone in October 2011 when the plant achieved stable production levels in preparation for the full capacity run scheduled for the fourth quarter of 2011. The new facility met that target on time by successfully completing the full capacity run on November 22, 2011 - only two months after starting raw material feeds to this new plant. Additionally, the plant exceeded expectations for all quality and yield performance parameters.

The world-scale plant, located within the Asia Industrial Estates (AIE) site near Map Ta Phut, Thailand, has a name plate capacity of 390 kilotons per annum (KTA) of PO via the innovative hydrogen peroxide to propylene oxide (HPPO) technology.


"The successful start-up of this environmentally advanced and complex technology shows the innovation power, project execution and operational strength of Dow, said Holger Baer, global manufacturing and technology director, Dow Propylene Oxide/Propylene Glycol.

⌠Dow's investment in this new facility strategically enhances its existing position as the global capacity leader in PO and better positions its derivative businesses such as Polyurethanes and Propylene Glycol, said Steven English, global vice president, Dow Polyurethanes. ⌠As a global strategic source point, Dow can better serve customers of these life-enhancing industries in Asia and beyond.

⌠Despite some anticipated challenges, the commitment of people from various functions has delivered a successful project. This HPPO plant will add value to propylene from the joint venture cracker in Thailand, said Cholanat Yanaranop, President of SCG Chemicals Company Limited.

MRC

China's Sinopec SABIC Tianjin Petrochemical cuts Jan LLDPE output

(ICIS) -- China's Sinopec SABIC Tianjin Petrochemical expects to produce only around 26,000 tonnes of linear low density polyethylene (LLDPE) in January, about 13% lower than usual, because of current low product prices, a source close to the company said on Monday.

Its plant, located in northern China, typically produces 30,000 tonnes of the polymer each month, the source said.

The facility has a designed capacity of 300,000 tonnes/year, he said.
⌠The reason why Sinopec SABIC Tianjin Petrochemical cut down LLDPE film output may be because the prices were below cost, the source said.

Spot LLDPE prices in northern China were assessed at yuan (CNY) 9,400-9,600 (USD 1,490-1,521/tonne) on Monday, according to Chemease.


The production cut is expected to spur buying of LLDPE in the region, traders said.


MRC

PO prices less bullish on worries of weaker demand

(ICIS) -- Market participants in Asia are toning down their bullish first-quarter forecasts for propylene oxide (PO) because of the uncertain macroeconomic outlook and worries about oversupply and weaker demand from China, the region's largest PO consuming nation.

Market players originally expected total PO demand in China to grow to above 2.2m tonnes in 2012, up from around 1.85m tonnes in 2011.
However, Asia's demand for PO is expected to drop because global economies are still grappling with substantial downside risks such as laggin GDP growth momentum as well as low business and consumer confidence, while China is still maintaining a prudent monetary policy, despite a recent cut in its bank reserve requirement ratio.


In addition, the tight supply conditions seen in 2011 have eased as operations at key facilities resumed and commercial production at new PO plants, including Dow Chemical's 390,000 tonne/year PO unit in Thailand have started successfully.
As a result, total PO imports to China rose to 41,437 tonnes in November 2011. The figure is a 69% month on month increase and an almost three-fold rise from the previous quarter. A similar trend is expected for December, but customs statistics are not yet available.

The increase in supply exerted downward pressure on the spot PO market, causing prices to fall by as much as USD 400/tonne (EUR 312/tonne) within weeks in December 2011, ICIS data showed.
In December, PO prices dropped to a one-year low of USD 1,500/tonne CFR China, according to ICIS data, narrowly breaching what market players said was the breakeven level for many producers, before rebounding to USD 1,600/tonne in end-2011 on the back of pre-holiday restocking activity.


Asian PO prices are likely to remain at above USD 1,600/tonne CFR China this year, as they did in 2011, industry sources said.
However, there will be price deviations of around USD 100-300/tonne this year, corresponding with changes in market sentiment and the demand-supply balance.
Spot PO prices fluctuated at a wider USD 300-500/tonne range in 2011 because of tight supply and rose to above USD 2,000/tonne in the aftermath of the March earthquake in Japan, as market players panicked when regional supply chains were disrupted.

MRC

Styrolution targets price rise for European PS in January

(ICIS) -- Styrolution is targeting a EUR145/tonne (USD186/tonne) increase for its European January polystyrene (PS) because of higher styrene and butadiene costs, a source at the styrenics producer said on Friday. The styrene barge contract for January was settled at EUR1,214/tonne FD (free delivered) NWE (northwest Europe), up by EUR120/tonne from its December level.


Butadiene is also up, with the January contract settling at EUR1,700/tonne FD NWE, up by EUR 50/tonne from December. Butadiene is used in the manufacture of high impact polystyrene (HIPS).
US-based producer Styron has already announced that it will target a EUR135/tonne increase for January PS.


Buyers have become accustomed to PS pricing moving in line with its main feedstock styrene, and they are now expecting to be paying much higher prices when they settle later in the month.


2012 is expected to be a difficult year in the European PS arena as new capacity comes on-stream.


European producers have managed to maintain a fine supply/demand balance in the recent past, closing down capacity where necessary and cutting back production in line with dwindling demand.


Styrolution is 50:50 joint venture between BASF and INEOS, comprising the key styrenics activities of the two partners. It began trading on 1 October 2011.


MRC

Middle East PP and PE Market: Prices Unlikely to Change Due to Poor Demand

(chemmonitor) -- Polyethylene (PE) and polypropylene (PP) markets in the Middle East will witness good margins due to firm values for a raw material this year. Meanwhile, PP and PE costs may be permanent with a tendency to decrease on the back of poor consumption.


In Saudi Arabia prices for ethane gas are stable. They are negotiated at USD 0.76 (EUR 0.61) per MMBtu. Values for Saudi propane gas demonstrate a downward surge.

PE producers will broaden the boarders of their resin market on profitable prices.

MRC