Asian tyre makers to resist a USD300-500/tonne hike

(ICIS) -- Major tyre makers in Asia, stricken with weak exports sales, are putting up a strong resistance to a USD300-500/tonne (EUR234-390/tonne) hike in butadiene rubber prices this week for February and March shipments, industry sources said on Thursday.

BR producers are offering USD3,600-3,800/tonne CFR (cost and freight) Asia - up by more than 10% from January levels - citing a continued spike in the cost of feedstock butadiene (BD).
⌠We are not happy with this situation because when the feedstock BD price fell to around USD1,500/tonne last November, the BR producers did not adjust their prices downwards, said an India-based tyre maker. ⌠Buying sentiment is weak and we will not accept a big price hike for February and March shipments, he added.

BD prices were assessed at USD3,050-3,100/tonne CFR northeast Asia in the week ended 13 January, nearly double their values two months ago, according to ICIS data.

BD is the raw material for the production of BR, which in turn, is used in the manufacture of tyres for automobiles.

But Asian tyre makers are coping with poor export sales amid a weakening global market condition, affecting China and India - the region's biggest emerging economies - that any significant increase in cost of production would not be welcome.

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(ICIS) -- Methanol producer Methanex may move a second plant from Chile to the US Gulf, a New York stock analyst said on Wednesday. Methanex said late Tuesday that it would move one of its four methanol plants in the South American country to a site in southern Lousiana, by mid-2014.

But Charles Neivert, managing director at Dahlman Rose & Co. in New York, said he's been told that the property Methanex purchased in Geismar, about 60 miles south of Baton Rouge, could easily contain two methanol units. ⌠It looks like there's at least that possibility, Neivert said in an interview.
Neivert sent out a research note on Wednesday saying the move to Louisiana would begin to resolve Methanex's recurrent problems in Chile.

The Methanex move marks the second announcement in a year of a new methanol plant operating in the US. In January 2011, it was announced that a mothballed methanol plant in Beaumont, Texas, would be restarted. That plant, owned by OCI North America, began making ammonia in December and will begin making methanol by the end of March.

Methanex did not immediately return calls on Wednesday. The company's release said low North American natural gas prices made Lousiana an attractive location for making methanol.
Methanex has three idle plants in Punta Arenas, Chile. Only one Methanex plant there is operating, with a capacity of 850,000 tonnes/year. The three idle plants have capacities between 800,000-975,000 tonnes/year, according to ICIS.

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(Bloomberg) -- IRPC Pcl (IRPC) sold a cargo of heavy naphtha at a premium of USD55 to USD60 a metric ton over benchmark Japan prices, according to two traders with knowledge of the company's tender. The shipment, which was sold earlier this week, contains about 30,000 tons for loading from Rayong, Thailand, in February, the traders said.

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(The Jakarta Post) -- Industry Minister M.S. Hidayat and Trade Minister Gita Wirjawan inaugurated the first ever Butadiene plant in Indonesian in Cilegon, Banten, on Wednesday. The plant's production capacity is 100,000 tons a year.

The plant is part of publicly listed petrochemicals producer PT Chandra Asri Petrochemical (CAP) and will be managed by the company's subsidiary PT Petrokimia Butadiene Indonesia.
Butadiene is a material for production of synthetic rubber that is usually used to make tires and other automotive components.

CAP has spent USD145 million (Rp 1.34 trillion) to build the plant, which is set to begin operations next year.

MRC

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