LyondellBasell reports widening polymer margins

MOSCOW (MRC) -- LyondellBasell Industries, the world’s biggest maker of polypropylene plastic, posted second-quarter earnings that topped analysts’ estimates as margins widened on higher prices, said Hydrocarbonprocessing.

Net income was USD2.23/share, compared with USD1.61 a year earlier, London-based LyondellBasell said in a statement Friday. Income from continuing operations was USD2.22, which exceeded the USD1.92 average estimate of 18 analysts compiled by Bloomberg. Sales were USD12.1 billion, compared with USD11.1 billion a year earlier, beating the USD11.5 billion average estimate.

CEO Jim Gallogly is expanding LyondellBasell’s US chemical plants as hydraulic fracturing in shale rock formations boosts supplies of natural gas and cuts raw-material costs. Polypropylene, used in bottle caps and carpets, and polyethylene, used in plastic bags, is mostly made from gas in North America.

"Integrated polyethylene margins in the US were up as much as 4 cents a pound, so that’s a big positive," Hassan Ahmed, a New York-based analyst at Alembic Global Advisors who recommends buying the shares, said yesterday by phone.

Operating earnings at LyondellBasell’s Americas olefins unit, which makes polyethylene and polypropylene, rose 3% on higher product prices, it said.

As MRC wrote before, LyondellBasell has received a key permit required in the company's multi-plant ethylene expansion program which, when fully operational, is expected to increase annual ethylene capacity by an estimated USD3.12 billion, for a total estimated capacity of USD19.9 billion in North America. The ethylene expansion program began in 2013 and represents a total investment of approximately USD1.3 billion in the company's Channelview, La Porte and Corpus Christi, Texas plants which benefit from shale gas production.

LyondellBasell moved its tax residence to the UK from the Netherlands last year to avoid payments on dividends and gain flexibility in managing its cash. LyondellBasell is run from Houston and remains incorporated in Rotterdam.

LyondellBasell Industries NV is a manufacturing company. The Company produces chemicals, fuels, and polymers used for packaging, clean fuels, durable textiles, medical applications, construction materials, and automotive parts. LyondellBasell Industries operates globally and is headquartered in the Netherlands. LyondellBasell is also a leading licensor of polypropylene and polyethylene technologies. The more than 250 polyolefin process licenses granted by LyondellBasell are twice that of any other polyolefin technology licensor.
MRC

PVC imports to Kazakhstan surged by 68% in H1 2014

MOSCOW (MRC) -- Imports of polyvinyl chloride (PVC) into Kazakhstan rose by 68% over the first six months of 2014 and reached 31,000 tonnes, according to MRC DataScope report.


June PVC imports to Kazakhstan dropped to 6,000 tonnes after the peak April and May (6,500 tonnes and 6,900 tonnes, respectively).

Thus, the overalll PVC imports to the local market rose to 30,000 tonnes from January to June 2014 versus 18,500 tonnes a year earlier.

Producers from China are the main PVC suppliers to the local market because of the geographical factor. They account for over 95% of the local market this year.

MRC

Imports of titanium dioxide in Russia increased by 1.6% in the first six months 2014

MOSCOW (MRC) - Imports of titanium dioxide in the Russian market grew by to 40,200 tonnes in the first half of 2014, up 1.6% compared to January-June 2013, according to MRC DataScope report.
Russia's titanium dioxide imports were 9,000 tonnes in June, up 32% compared to May, reaching the highest level in the current year.

The largest supplier of titanium dioxide in Russia remained the company Dupont. Imports of Ti-pure grade were 9,400 tonnes in the first half of 2014, up 8.6% year on year.

Crimean Titan supplied 6,500 tonnes in the first half of 2014 in Russia, up 10% year on year.

The main suppliers still continued to be Ukraine, the USA, China, Finland and Germany.
MRC

Petkim opens plastic packaging factory in Turkey

MOSCOW (MRC) -- Turkish petrochemicals major Petkim Petrokimya Holdings has staged an official opening for a new plastic packaging factory at its petrochemical complex in the western Turkish town of Aliaga, reported SeeNews with reference to the company's statement.

The factory was built in five months, Petkim said in a statement, adding that the bulk of its output will be exported.

Petkim is constantly investing in new facilities, as well as in expanding the capacity and raising the efficiency of the existing ones, its general manager Sadettin Korkut said.

Petkim has made capital expenditures of more than USD500 million (EUR370 million) since its privatisation in 2008 and plans to invest an average of USD100 million annually until 2018, Korkut added. The company targets 6.0 million tonnes of gross production annually and a 40% share in the domestic market by 2023.

As MRC informed previously, The production capacity of the Turkish Pektim Petrochemical Holding where SOCAR, Azerbaijan’s state energy company has equity participation will increase from 3.2 million tons to 3.6 million tons in 2014. An increase in production capacity will be possible thanks to the improved capacity of ethylene and purified terephthalic acid (PTA) production enterprises. In particular, the ethylene production enterprise's capacity will increase from current 520,000 tons to 587,000 tons by late 2014. The PTA production capacity will increase from 70,000 tons to 105,000 tons which will require investments worth USD25 million.

Petkim is the leading petrochemical company of Turkey. Specializing in petrochemical manufacturing, the company produces ethylene, polyethylene, polyvinyl chloride, polypropylene and other chemical building blocks for use in the manufacture of plastics, textiles, and other consumer and industrial products.
MRC

PE imports to Kazakhstan fell by 27% in H1 2014

MOSCOW (MRC) -- Imports of polyethylene (PE) into Kazakhstan fell by 27% over the first six months of 2014. Demand for high density polyethylene (HDPE) and linear low density polyethylene (LLDPE) subsided, according to MRC DataScope report.


June PE imports to Kazakhstan grew to 7,800 tonnes on the back of the seasonal factor (6,800 tonnes in May). The overall imports of ethylene polymers to the local market dropped from January to June 2014 to 42,300 tonnes versus 57,600 tonnes over the same period of 2013. Demand for HDPE and LLDPE subsided, whereas demand for low density polyethylene (LDPE), on the contrary, increased.

The structure of PE imports by grades over the stated period looks the following way.

June HDPE imports rose to 6,400 tonnes (5,500 tonnes in May) on the back of increased imports from Russia, while shipments from other countries continued to decline. Overall, HDPE imports to Kazakhstan fell over the first six months of the year to 31,500 tonnes from 48,100 tonnes over the same period of 2013. Pipes producers accounted for more than 80% of the total HDPE consumption in Kazakhstan.


Weaker demand for HDPE in the key consumption sector- pipe extrusion - was caused by three factors this year. Firstly, the end of the regime of preferential pipe grade PE imports (0% duty for importers of pipe grade HDPE was in effect up to 1 January 2014). Currently, the import duty is 9.1%, and it will be reduced to 6.5% from September 2014. Secondly, the February 20%-devaluation of the national currency, which automatically led to a proportional increase in feedstock prices. And, thirdly, a further reduction of investments into infrastructure by the state.

Last month's LDPE imports rose up to 1,300 tonnes (1,100 tonnes in May) on the back of increased supplies from Russia. The overall LDPE imports to Kazakhstan totalled about 8,900 tonnes from January to June 2014 versus 7,500 tonnes over the same period of 2013. Russian producers are the key LDPE suppliers, their share in the total imports rose to 92% this year.

June LLDPE imports fell to 173 tonnes (316 tonnes in May). The overall LLDPE imports to Kazakhstan dropped over the first six months of the year to 1,900 tonnes, down by 7% year on year. Producers from Asia and Uzbekistan are the key PE suppliers to the republic.

MRC