July HDPE imports to Ukraine rose by 16%

MOSCOW (MRC) -- Ukrainian companies were forming actively inventories of high density polyethylene (HDPE) in August amid rising prices in Europe and falling supplies from Russia. HDPE imports to Ukraine grew by 16% from July, according to MRC DataScope.

In August, Ukrainian companies increased HDPE imports to 14,900 tonnes from 12,800 tonnes in July.
As expected, film and blow moulding HDPE accounted for the main growth in imports.

Film HDPE imports went up to 6,200 tonnes last month from 5,100 tonnes in July. Middle Eastern HDPE accounted for the main increase in imports (higher prices in Europe have forced the Ukrainian companies to look for cheaper alternatives). Imports of film HDPE are expected to drop in September because of continued price rises in Europe and the resumption of production at Karpatneftekhim (the first lots of HDPE have already entered the market).

The September scheduled outage at Kazanorgsintez HDPE production (the key PE supplier to Ukraine ) has forced local companies to build up additional inventories of blow moulding PE for the first autumn months. Imports of blow moulding HDPE rose to 3,500 tonnes in August from 2,200 tonnes in July. Russian polyethylene accounted for the main increase in supplies.

A seasonal factor led to increased pipe HDPE supplies. However, the overall August increase in imports was only 15% (2,900 tonnes from 2,500 tonnes in July) amid tight pipe PE supply in foreign markets

Higher prices in foreign markets and a lack of offers from Russian producers, on the contrary, resulted in reductions in August imports of injection moulding HDPE to Ukraine. Imports fell to 1,300 tonnes in August from 1,600 tonnes in July.

The overall HDPE imports to Ukraine totalled about 99,000 tonnes in the first eight months of 2013, up 27% year on year. Film HDPE accounted for the main growth in imports (about 67% to 41,900 tonnes).

MRC

MOSCOW (MRC) - Verkhovna Rada of Ukraine has adopted the changes to the Customs Tariff. But the import duty on polyvinyl chloride (PVC) remained unchanged. The final decision concerning PVC duty will be taken by a separate law, according to MRC.

On 19 September, the Ukrainian parliament voted for a change in the Customs Tariff of Ukraine in line with the European standards. Representatives of the Cabinet said the changes are important taking into account Ukraine's commitments before the International Convention on the Harmonized Commodity Description and Coding System, as a part of Ukraine's membership in the WTO.

Ukraine's import duties on unmixed PVC remained unchanged - 0% in the final draft amendments to the Customs Tariff, despite the initial version of the law draft expected to introduce two rates: a reduced rate of 6.5% and in the long run 13%.

However, some Ukrainian parliamentarians hope to increase import duty for unmixed PVC. The chairman of the Ukrainian Union "Batkivshchyna" Arseniy Yatsenyuk stands for the introduction of PVC duties, citing the need to support domestic producers - Karpatneftekhim (Kalush, Ivano-Frankivsk region).

Another deputy from " Batkivshchyna ", Olga Sikora, on 18 September registered a separate bill on amendments to the Customs Tariff of Ukraine, concerning an increase of PVC import duty by 6.5%.

A representative of the profile committee of the Verkhovna Rada Vitaly Homutynnik pointed out that it was agreed to prepare a separate bill to regulate this problem.

As MRC wrote before, the increase of duties on imported PVC to Ukraine by 6.5% was one of the main conditions for the resumption of the "Karpatneftehim," according to the memorandum signed by the Ukrainian Government and the Russian group LUKOIL in April of this year.

Karpatneftekhim (Kalush, Ivano-Frankivsk region), a subsidiary of "LUKOIL Neftekhim " - is the largest producer of polymers in Ukraine. The company produces polyolefins (ethylene and propylene), polyethylene (PE), chlorine, polyvinyl chloride (PVC), and caustic soda.

MRC

MOSCOW (MRC) - Russian production of finished products made of polymers in August increased by 1.4% compared with July's level, according to MRC analysts.

The largest increase in the output last month's output occured for the production of polymer pipes and fittings, while production of films and sheets, on the contrary, decreased.

According to the Federal State Statistics Service of the Russian Federation, the production of pipes, hoses and fittings made of polymers was 58,700 tonnes in August, up by 6.3% from July's level. Russia's production of pipes, hoses and fittings made of polymers totalled 390,000 tonnes in January and August of this year, from 450,000 tonnes year on year.

The output of non-porous and non-combining films and sheets last month fell to 74,400 tonnes, from 76,300 tonnes in July. The production of non-porous and non-combining films and sheets in Russia totalled 553,600 tonnes in the eight months of this year, down by 2% year on year.

August production of plastic windows and window sills was 3.1 m square meters, up by 3% from the July's level. The production of plastic windows and window sills in Russia in the eight months of 2013 totalled 17 m square meters, up by 8.8% year on year.

The production of polymer doors and boxes in August was kept at the level of July and was 102,000 square meters. The production of these products exceeded 600,000 square meters in January - August, down by 2% year on year.

The production of polymer plates and sheets was 19,900 tonnes in August, up by 2.4% from July's level. The output of these products in Russia totalled 132,800 tonnes in the eight months of this year, up by 16.7% from January - August 2012.

The production of bottles, flasks and similar articles of polymers in Russia in August fell to 1.1 billion items, from 1.4 billion items a month earlier. The production of these products exceeded 9.5 billion items in the eight months, down by 0.4% year on year.

MRC

MOSCOW (MRC) - Russian producers practically managed to keep the output of polyethylene (PE) in August at the July's level, despite scheduled maintenance in Salavat and Angarsk, according to MRC ScanPlast.

Russia's PE production in August was 135,200 tonnes from 135,800 tonnes in July. The increase in production at the facilities of Ufaorgsintez, Tomskneftekhim and Kazanorgsintez offset the decrease in the PE production in Salavat and Angarsk because of the scheduled maintenance works there.
Russia's PE production by grades in August was as follows. Production of low density polyethylene (LDPE) in August was about 46,100 tonnes, which is equal to July's results. The decline in PE production at "Gazprom neftekhim Salavat" and " Angarsk polymer plant " due to the maintenance works in August was offset by an increase in the output by Ufaorgsintez and Tomskneftekhim.

August production of high-density polyethylene (HDPE) fell to 89,100 tonnes, from 89,700 tonnes in July. A number of plants reduced HDPE production in August (Stavrolen - down by 6% from July; "Gazprom neftekhim Salavat" - down by more than twofold due to the turnaround; Nizhnekamskneftehim - down by 2% from July), while Kazanorgsyntez increased its HDPE production to 44,500 tonnes, up by 8% compared to July.

Overall, Russia's PE production exceeded 1.11 m tonnes in the eight months of this year, from 888,000 tonnes year on year.


MRC

MOSCOW (MRC) -- LANXESS, German specialty chemicals company, is expanding its portfolio of phosphorus-based chemicals by taking over the business operations belonging to the French subsidiary of the insolvent Dutch company thermPhos International B.V., reported the company on its site.

The transaction closes with immediate effect.

LANXESS is acquiring the production assets and the customer list of the thermPhos site in Epierre, South Eastern France - a globally leading Phosphorus Pentoxide and Polyphosphoric Acid producer. Both products are complementary to the company’s existing phosphorus portfolio. They can be used as chemical intermediates including flame retardants and pharmaceuticals.

The site will be integrated into the production network of LANXESS’ business unit Functional Chemicals (FCC), which belongs to the company’s Performance Chemicals segment.

Apart from phosphorus-based chemicals, FCC manufactures specialty plasticizers and colorants. It employs about 480 people worldwide, with the majority based at its sites in Leverkusen and Krefeld-Uerdingen, Germany.

As MRC wrote previously, Lanxess has recently developed a new polyester material grade based on polyethylene terephthalate (PET). The new material grade - Pocan TP 555-001 - is excellently suited to manufacturing housings, sockets and other components for light-emitting diodes (LED). What makes the product unique is its excellent light reflection, which hardly declines at all over time, and its high heat stability. Besides, it is reinforced with glass fibers and contains special additives.

Lanxess is a leading specialty chemicals company with sales of EUR9.1 billion in 2012 and roughly 17,400 employees in 31 countries. The company is currently represented at 50 production sites worldwide. The core business of Lanxess is the development, manufacturing and marketing of plastics, rubber, intermediates and specialty chemicals.
MRC