Prices in the Russia DOP market stopped falling

MOSCOW (MRC) -- By January, the price situation in the Russian market of dioctylphthalate plasticizer (DOP) had stabilized after a sharp fall in prices in November. Some market participants do not exclude a price rise in the near future, according to MRC Price report.

By early February, prices of Russian DOP had remained in the range of Rb62,000-65,000/tonne, FCA, including VAT. But, according to some market participants, they are likely to grow in the near future.

In November, 2012, the change of the managing company of Perm plant (Kamteks-Khimprom) resulted in a serious drop in prices in the market. Thus, in October prices of Russian DOP were on average in the range of Rb82,000-84,000/tonne, FCA, including VAT, but in November, prices fell to the level of Rb70,000/tonne, FCA, including VAT.

Gazprom neftekhim Salavat has suspended production of DOP, and now it is shipping the remains of the material as per the January contract obligations. Some market participants do not exclude that with the resumption of production of plasticizer, Gazprom neftekhim Salavat will announce a price increase.
MRC

MOSCOW (ICIS-MRC) - European makers in February were forced to cut export prices of polypropylene for the CIS countries, according to a ICIS-MRC Price Report.

Despite the increase in the contract price of propylene in Europe, which was agreed by EUR10/tonne up from the January level, European producers were forced to reduce export prices of polypropylene for the CIS countries by EUR20-40/tonne. It resulted from the low demand and the strengthening of the euro.

The negotiation on February prices of European PP for CIS markets continued last week. Many market participants reported that they managed to get price reductions. The deals for February homopolymer of polypropylene (PP-homo) were discussed at EUR1 ,170-1, 230/tonne, FCA. The prices of block copolymers of propylene (PP-block) started from EUR1, 240/tonne, FCA.

However, many market participants are in no hurry to buy polypropylene in Europe. February's decline in the price of the European polypropylene was almost completely offset by the growing of the euro against the dollar. Since early January, the European currency has grown against the dollar by 4%.

In addition, market players refere to the prices in Asia and the Middle East. Offers for March shipments of Asian and Middle Eastern PP were voiced at USD1 ,560-1, 600/tonne, FOB.


MRC

MOSCOW (MRC) - In 2012 Ukraine produced about 19,000 tonnes of polystyrene (PS), according to a MRC DataScope.

In relation to the 2011 production of polystyrene in Ukraine last year (18, 925 tonnes) was cut by 9%.

In 2012, the structure of polystyrene production in Ukraine changed. The share of expandable polystyrene (EPS) decreased from 71% in 2011 to 60% in 2012.

At the same time, the share of general purpose polystyrene (GPPS), respectively, increased from 29% in 2011 to 40% in 2012.

Similar changes have taken place due to the increase in demand for general purpose polystyrene from Russian refiners in the south region. Lower logistics costs increase the competitiveness of the material in this area.

In 2012 the volume of general purpose polystyrene made 7,505 tonnes, up 39% from 2011. Production of EPS, however, decreased by 23% and amounted to 11,350 tonnes of material.



MRC

MOSCOW (MRC) -- PetroLogistics LP (the "Partnership"), the owner and operator of the only U.S. propane dehydrogenation facility producing propylene from propane, has unveiled its financial results and a cash distribution for the fourth quarter of 2012, reported Reuters.

Total sales in the fourth quarter were USD166.1 million, with propylene sales contributing USD161.4 million. Net income for the quarter was USD25.9 million. The company's reported results include certain items that impact comparability of financial results between reporting periods. Excluding the impact of these items, the company's adjusted net income was USD35.5 million, while adjusted EBITDA was USD45.9 million.

Cash available for distribution totaled USD38.9 million for the fourth quarter of 2012.

"Although the propylene market environment was generally challenging for most of the second half of last year, propylene prices increased each month of the fourth quarter as supply/demand balances continued to rationalize," said David Lumpkins, Executive Chairman of PetroLogistics. "With inventory levels now well within historical norms, conditions are in place for a much improved market environment as we enter the new year."

The Partnership produced 295 million pounds of propylene and sold 313 million pounds of propylene during the fourth quarter of 2012. The Partnership recognized total sales of USD166.1 million during the quarter, which included
propylene sales of USD161.4 million.

As previously reported by MRC, the plant had an unplanned outage during the last two weeks of the year during which time the facility continued to supply customers out of inventory. The outage continued through the first week of January but the plant has since resumed operations.

Cost of sales was USD120.5 million for the fourth quarter of 2012. For the fourth quarter of 2012, the Partnership had a gross profit of USD45.6 million.

We remind that that still in September last year PetroLogistics LP was seeking permission to double the Houston factory's output as supplies fall and competitors including Dow Chemical Co. plan similar facilities. The company wanted to add six combustion units to the five currently producing propylene, an ingredient in plastics, nylon and detergents.

PetroLogistics LP is a major producer of propylene and is the only independent dedicated propylene producer in the United States. PetroLogistics LP owns and operates the world's largest propane dehydrogenation facility, based on production capacity, strategically located on the Houston Ship Channel with direct and indirect access to approximately 1/2 of U.S. propylene consumption.
MRC

MOSCOW (MRC) -- France has received five bids to buy a troubled oil refinery, including the two considered to be serious and well-financed, according to Reuters.

The Petit-Couronne refinery in Western France, now in receivership, was among a string of industrial facilities new French President Francois Hollande had promised to protect before being elected.

The refinery is in trouble after its owner, Swiss-based company Petroplus Holdings AG, filed for protection from creditors.

The two bids deemed serious come from investors in Egypt and Switzerland.

The refinery has a capacity of 161,000 bpd, according to news reports.

We remind that, as MRC wrote previously, in February, 2012, Royal Dutch Shell had signed a contract to hire the French refinery owned by insolvent Swiss-based refiner Petroplus to process crude oil for six months. Resuming operations at the refinery, which was gradually shut down in January, required EUR50 million investment. Shell should have transferred EUR20 million to the refinery in advance of future payments to the refinery. The government should have financed the remaining EUR30 million.

In December, Shell ended a six-month oil processing deal with the troubled plant and has not extended the contract, making the refinery less attractive for buyers due to expensive re-start costs.

Petroplus, one of the largest independent European refiners, was forced to file for insolvency in late January after struggling for months with weak demand due to the economic slowdown in Europe and overcapacity amid tighter credit conditions, high crude prices and competition from Asia and the Middle East.
MRC