Exports of caustic in Russia decreased by 0.8%

MOSCOW (MRC) -- Russian production of caustic soda in January-May 2013 fell by 0.8% compared to the same period in the previous year and totalled 73,800 tonnes, according to MRC Monthly Report.
The largest customers of Russian caustic are Turkey and Ukraine.

The share of their purchase in Russian exports of caustic this year make 47% and 43%, respectively.

Russian largest exporter of caustic soda is Kaustik (Volgograd). The company exported 30,800 tonnes in January-May 2013.

The total Russian imports of caustic soda in January-May 2013 amounted to 18,700 tonnes, up by 10% year on year.
As reported by MRC earlier, in January-May 2013 the production of caustic soda in Russia fell by 1.2% compared to the same period in the previous year and totalled 448,700 tonnes.

MRC

MOSCOW (MRC) -- Last week spot prices of Ukrainian bottle grade polyethylene terephthalate (PET) for July were cut by UAH300/tonne, according to ICIS-MRC Price Report.

On the back of general price cuts, trading companies reduced the prices of the Lithuanian and Belarusian bottle grade PET for Ukrainian market.

According to a trader, domestic demand continues to be strong, which is typical for this season.

Prices of Belarusian bottle PET of 8200 grade and Lithuanian brand Neopet are heard at UAH16,500-16,700/tonne CPT Kiev, including VAT.

Imports of PET to the Ukrainian domestic market by Lithuanian Neo Group and Indorama Polymers totalled about 13,500 tonnes over the January-May 2013.

Imports of Belarusian PET from Mogilevkhimvolokno over the same period was 1,200 tonnes.

The total Ukrainian imports of PET over the Jan-May 2013 made 87,000 tonnes.
MRC

MOSCOW (MRC) - Prices of polypropylene (PP) in the Russian market increased by Rb500-2,000/tonne on the back of stronger demand and tight supply, according to ICIS-MRC Price Report.

A seasonal increase in PP demand coupled with the tight supply made Russian producers to go for a rise in price, in spite of the expectations of many market participants.

Decreased imports and oncoming shutdown of Tomskneftekhim for maintenance works also contribute to price growing.

A number of Russian producers have already announced price increases for July PP supplies. Polyom announced a Rb500/tonne increase in the July contract price of PP. Ufaorgsintez has announced increase in PP price of Rb1,500/tonne under the pressure of the low stocks, the rising feedstock costs and the reduction in run rates planned in the end of July. Nizhnekamskneftekhim raised the PP price by Rb2,000/tonne.

PP imports May and June significantly decreased, in particular, the supply of raffia from Turkmenistan. Russia's imports of PP in May fell to 13,000 tonnes, from the April's level of 22,500 tonnes. The June PP imports to Russia totalled 13,600 tonnes.

The continued weakening of the rouble against the dollar makes the purchases of PP in foreign markets increasingly unprofitable.

The second largest producer of polypropylene in Russia - Tomskneftekhim (SIBUR Group) plans to go for turnaround from 18th July to 9th August. The sources from the plant say that the current inventories are enough to meet the demand from of key customers. The capacity of Tomskneftekhim's PP production is 140,000 tonnes/year.
MRC

MOSCOW (MRC) -- The European producers have raised July prices for suspension polyvinylchloride (PVC-S) for the the CIS countries, according to ICIS-MRC Price report.

European producers increased July PVC-S prices for the CIS markets by EUR10-20/tonne from June, despite stable contract prices of ethylene in Europe. European makers explain higher export prices in July by limited PVC
inventories.

Meanwhile, some market participants say that they were able to preserve June PVC prices for July shipments. In general, deals for July deliveries of European PVC to the CIS countries are being concluded in the range of EUR755-810/tonne, FCA.
MRC

MOSCOW (MRC) -- MRC news digest over the past week.

1. Production of PP in Russia rose by 6% in May.

Russia's production of polypropylene (PP) in May exceeded 69,000 tonnes, up 6% from April. The main increase in the production was provided by Polyom, Omsk. Russia's PP production in May grew by 6% compared to the April index, despite reduced capacity utilisation of some plants and a scheduled maintenance works at Ufaorgsintez.
The capacity utilization of the new site Polyom, Omsk (Titan Group) offset the decline in production of other plants. Only two Russian producers - Stavrolen and Polyom could increase their capacity utilisation in May. Stavrolen increased its capacity utilisation in May by 14% compared to April. The plant's production of PP in May totalled about 11,400 tonnes. Polyom actually doubled its capacity utilisation, the total production of PP in May exceeded 11,000 tonnes, from 5,200 tonnes in April. In general, the total production of PP in Russia in Jan-May 2013 made 328,700 tonnes, up 25% compared with the same period a year ago.

2. Production of caustic soda in Russia declined by 1% in Jan-May 2013.

Russia's production of caustic soda in January-May 2013 fell by 1.2% compared to the same period in the previous year and totalled 448,700 tonnes. The share of Kaustik (Volgograd) accounted for 20% of Russia's total production of caustic soda over the five months of the year. The share of SayanskKhimPlast made 18% from all the volume of caustic soda produced in Russia over this period. Kaustik (Sterlitamak) produced 17% of the total production of the material in the country. Russia's production of caustic soda in May made about 87,000 tonnes, up 2% from April.

3. Ukraine to raise import duties on PVC in autumn.

The Ukrainian government is to raise import duty on unmixed polyvinyl chloride (PVC) in autumn 2013. The chances of adoption of this law are large enough. The bill regarding the raise of the import duty on unmixed polyvinyl chloride (PVC) has been agreed in all the committees of Ukrainian parliament by the beginning of June. Ukrainian parliament has gone on vacation till September and the bill will not be accepted before the autumn. The bill assumes increasing import duty on unmixed PVC from current 0% to 6.5% (which corresponds WTO regulations), besides there will be introduced an additional anti-dumping duty on US PVC. The increase of PVC import duty was one of the commitments of Ukrainian government undertaken in April to resume the production of Karpatneftehim, the only Ukranian producer of PVC. The government signed a memorandum about this with the Russian company Lukoil, the owner of Karpatneftehim. The memorandum has a number of conditions for the resumption of Karpatneftehim's production, including the increase of import duty.

4. CIS buyers expect Asian PET prices to be cut further.

The converters of polyethylene terephthalate (PET) in the CIS countries expect a further decline in export prices of Chinese bottle grade granulate in July. Last week converters of bottle grade PET in the CIS countries reported a decrease in the purchasing prices by USD15-20/tonne. PET prices in Asia were cut on the back of a sluggish buying activity, as well as falling prices of paraxylene. PET prices in the Ukrainian port were at USD1,410-1,445/tonne CIF Odessa, excluding VAT. Import prices of Chinese bottled grade PET for the Russian market ranged USD1,391-1,416 per tonne CFR East, excluding VAT. Major market players expect that in July the export prices of Chinese bottle PET granulate can fall to USD1,300-1,320/tonne FOB China. Some market sources are more pessimistic in their outlook and expect PET prices in late July to be cut significantly below USD1,300/tonne FOB China.

5. Russian prices of LDPE shrink films to grow in July.

The market of low-density polyethylene (LDPE) continues to be oversupplied in the Russia on the back of weak demand. The only exception makes LDPE shrink films, limited supply of which could result in price increase. In the early July Russian market of LDPE continues to be excessive as capacity utilisations of Russian plants are loaded at high level, while exports are weak because of sluggish demand in the foreign markets. All of these factors put pressure on the Russian prices of LDPE. The only exception is polyethylene for shrink films, the prices of which are high on the limited supply in the market. Two Russian producers - Kazanorgsyntez and Ufaorgsintez have limited their supplies of shrink films. Besides, Kazanorgsyntez announced a price increase of PE 153 by Rb1,000/tonne, effective from 1 July. So, the price of LDPE 153 in the Russian market grew to Rb60,000-61,500/tonne FCA, including VAT. The maintenance works in Tomsk and Salavat can strengthen the shortage of shrink films. Gazprom neftekhim Salavat plans to stop on the turnaround from 18 July to 17 August. Tomskneftekhim plans maintenance works from 18 July to 9 August. MRC analysts expect the prices of LDPE shrink films to be increased on the back of scheduled maintenance works in Tomsk and Salavat.

6. Mogilevkhimvolokno cut export prices for July.

Last week Mogilevkhimvolokno, Belarusian producer of polyethylene terephthalate (PET) announced reduction of export prices for Ukraine by EUR75/tonne. Mogilevkhimvolokno had to decrease its export prices for the Ukrainian market on the back of falling feedstock prices, as well as the general down trend of European PET prices in June. Ukranian traders said that the decline in the prices of Belarusian PET makes the material more competitive relative to the Lithuanian grade Neo Group. At the same time, the price of the Belarusian PET for shipments to Russia remained stable as buying activity in the Russian market is strong because of the shortage of the material in the spot market.

7. Some European PP producers raise July prices for CIS markets.

Negotiations on European polypropylene (PP) prices for July have begun for CIS markets this week. Some European producers announced price increases, others are planning to keep the June prices for July.The contract price of propylene in Europe for July deliveries was agreed at the level of June. Though the price of propylene were left at the roll over from June, some European producers aimed to increase PP prices by EUR20/tonne, citing limited export quotas. Other the European producers keep their PP prices for July at the level of June. At the same time, export PP prices were increased only by those producers who offer PP in June in the lower price range.

8. May imports of PET to Kazakhstan grew twofold.

In May, imports of polyethylene terephthalate (PET) to Kazakhstan increased more than twofold compared to April.In May on the back of growing seasonal activity Kazakh companies increased their purchases of granulate in foreign markets. In January-May 2013 the capacity of Kazakh PET market is almost the same with last year's indicators. According to customs statistics, in January-May 2013 the Kazakhstan market received 24,300 tonnes of PET granulate. Imports of Chinese granulate totalled about 16,000 tonnes. Korean companies shipped about 8,000 tonnes. In 2012, the total consumption of PET granulate in Kazakhstan made 52,700 tonnes. The lion's share of PET imports in 2012 provided material from China.

9. Russian producers of DOP to keep June prices for July.

Strong demand for dioctyl phthalate (DOP) plasticiser in the Russian market allowed local producers to keep the June prices for July. In July the supply of plasticiser DOP in the Russian market has increased markedly. However, despite expectations of many market participants, the price of DOP for July was left at the roll over from June on the back of strong demand. The spot deals for Russian plasticiser DOP for July deliveries were in the range of Rb74,000 -75,000/tonne FCA, including VAT.

10. Kazanorgsintez announced pipe HDPE price rise in July.

Kazanorgsyntez, TAIF Group, Russia's largest producer of polyethylene, announced an increase in the contract price of pipe high-density polyethylene (HDPE). Kazanorgsintez announced an increase in the contract price of the coloured pipe HDPE by Rb1,000/tonne, compared with the June level. The new contract price of pipe HDPE will be effective from 5 July 2013.
MRC