Arkema showed highest-ever profit in 2011 in restructuring

(plasteurope) -- For French chemicals and plastics producer Arkema, 2011 was a "new milestone" in its history, CEO Thierry Le Henaff said in presenting annual results. "The financial performance was excellent, and the group's transformation has been actively pursued," he added. The CEO credited structural improvements achieved over the past several years for pushing EBITDA to just over EUR 1 bn - "twice the earnings result of 2007 in a similar macroeconomic environment."

Arkema CEO Thierry Le Henaff said the group's 2011 results were "excellent" Group figures for 2011 show EBITDA up 28% year-on-year to EUR 1.03 bn on the back of a 21% sales rise to EUR 5.9 bn. Adjusted for the Vinyl Products activities spun off late last year in preparation for a sale to the Swiss family-run Klesch group.

Sales of the Industrial Chemicals segment, which includes the acrylics business, rose by 24% to EUR 3.9 bn, thanks in part to ⌠significant price increases to offset higher raw materials costs. The segment's EBITDA improved by 28% to EUR 732m and the EBITDA margin widened to 18.6% from 18%. Performance Products, including the polyamide activities and the PVDF fluoropolymers business, saw sales expand by 16% to EUR 1.95 bn. The segment's EBITDA increased by more than 30% to EUR 339m and lifted its earnings margin to 17.4% from 15.5% in 2010.

Arkema's sales figures pertain solely to continuing operations and thus exclude the performance of Vinyl Products. The sales improvement is attributed in particular to the specialty coatings resins activities acquired from parent Total and consolidated from July 2011- as well as to start-ups in Asia. The resins acquisition is also credited with contributing to the earnings upturn, along with the start-up of the ⌠Kynar PVDF plant in Changsu / China .

Separately held Vinyl Products saw EBITDA decrease by 24% in 2011, due to a "challenging European construction market with significant destocking by customers at year's end." Fourth-quarter earnings were diminished by strikes at the LyondellBasell refinery in Berre, triggered by the announcement that the unit would close, and at Arkema's Vinyls sites in protest of the divestment plan. The group said it was able to increase prices for caustic soda and PVC, "without fully offsetting the rise in ethylene and energy costs."
MRC

(plastemart) -- Sharply increasing freight costs are reported to be creating obstacles to global polymer trade- several sources complain that the volume of their shipments has fallen, and sellers complained that rising costs are forcing them to take a firmer stance on their prices.

International freight companies announced large freight rate increases for March in a bid to restore margins. Shipping companies in Europe have already announced additional significant freight increases for April after achieving most of their rate increase targets for March.

A trader offering Chinese and South Korean PET to overseas markets complained of having trouble maintaining competitiveness owing to rising freight costs. "Sales to some of our regular destination countries such as Russia and Brazil have fallen recently as rising freight rates have made it more difficult for us to offer at competitive prices in these markets," the trader complained.

Another trader importing PP and PE to the Turkish market also complained of facing greater difficulties in deal conclusion owing to the rise in freight costs. "Our shipments from Singapore to Turkey are down by around 20% when compared with the past month because of the increase in freight costs," the trader complained. In addition to complaints about reductions in volume, several sellers commented that rising freight costs are putting pressure on them to raise their prices even in the face of less than lackluster demand.


MRC

(plastemart) -- Graham Corporation -a designer and manufacturer of critical equipment for the oil refining, petrochemical and power industries, including the supply of components and raw materials to nuclear energy facilities, has secured USD8 million in orders that are expected to be delivered in the fourth quarter of Graham's fiscal year 2013, which ends March 31, 2013.

The steam surface condensers for the China-based project will be used in a plant that produces petroleum products from coal. As the world's largest producer and consumer of coal, China has embraced CTL technology.

The petrochemical project in the Middle East is for an ethylene facility. Petrochemical projects have been advancing with the gradual improvement in the global economy. All five steam surface condensers will be built in Graham's Batavia facility.
MRC

(observer) -- Nova Chemicals expects to receive feedstock in the form of Marcellus shale ethane as early as mid-2013.

An application is being sent to the National Energy Board for an 8 km pipeline extension to link to an existing St. Clair River crossing for Marcellus shale gas. Nova plans to expand ethylene production at its Corunna site, increase polyethylene production at its Moore site, and is eyeing the possibility of a new world-scale polyethylene plant in Sarnia-Lambton.

The Corunna cracker is being converted to use all natural gas liquids by 2014. The unit can currently handle ethane, butane, crude oil, propane and other materials. Construction of the project estimated to cost up to USD250 mln, will start to ramp up in Q3/Q4, upon environmental approvals.
MRC

(polyestertime) --Lukoil and Gazprom Neft may retreat as much as 10 percent over the next few weeks as waning concern over tensions with Iran brakes oil's advance, according to Quesnell Capital SA.

Lukoil, Russia's biggest non-state crude producer, has jumped 22 percent in U.S. trading in 2012, while Gazprom Neft, the oil arm of gas export monopoly OAO Gazprom, has added 12 percent as Iran's threat to shut the Strait of Hormuz, a transit route for a fifth of the world's oil, pushed Brent crude above USD125 for the first time in nine months. Futures (VEA) expiring in June on Moscow's dollardenominated RTS Index were little changed at 169,455 in U.S. trading on March 16.

Bets that Brent will continue to rally have dropped from a seven-month high reached on March 9 and options on West Texas Intermediate, the most liquid oil contracts, show traders are paying less to insure against price swings, data compiled by Bloomberg show. Concern that a reduction in Iranian exports will cut global oil supply is dissipating as the U.S. and U.K. mull releasing strategic reserves and Saudi Arabia, the world's biggest crude exporter, says it can make up for shortages.

"We've already seen a slowdown in the oil rally, I would expect some weakness in the oil stocks,"Ian McCall, a managing partner in Geneva at emerging-markets investment adviser Quesnell, which oversees 100 million Swiss francs (USD107 million) including Russian assets. "Once the rally tops, we may see a 5 to 10 percent pullback in Russian oil stocks over a couple of weeks."

MRC