Output of products from polymers rose in Russia by 9.6% from January to July 2014

MOSCOW (MRC) -- Russia's output of finished goods from polymers increased by 9.6% over the first seven months of 2014. The construction sector still demonstrated negative figures, reported MRC analysts.

Production of main products from polymers in Russia increased significantly in July under the pressure of seasonal factors, which affected the final figures. Thus, the output of key products from polymers rose by 8.6% from January to June 2014, while this figure grew by 9.6% from January to July 2014. Nevertheless, the construction sector showed the negative result.

According to the Federal State Statistics Service of the Russian Federation, July production of unreinforced and non-combined films rose to 112,000 tonne (99,600 tonnes in June). Thus, Russia's ouput of these products totalled about 611,700 tonnes from January to July 2014, up by 26.2% year on year.

Last month's output of plates and sheets reached 19,300 tonnes (19,000 tonnes in June). Production of these products by Russian companies reached 125,500 tonnes over the stated period, up by 3.6% year on year.

July production of plastic pipes, hoses and fittings rose to 56,000 tonnes on the back of seasonal factors (48,700 tonnes in June). The overall output of these products reached 302,600 tonnes over the first seven months of 2014, down by 10.3% year on year.

Last month's output of plastic windows and their frames and sills increased to 2.9 million square meters (in June - 2.1 million square meters). Production of plastic windows and window sills totalled 13.5 million square meters from January to July 2014, down by 6.8% year on year.
MRC

MOSCOW (MRC) -- Russia increased its production of polyimide 6 (PA 6) from January to July 2014 by 9.4% year on year to 85,200 tonnes, according to MRC ScanPlast report.

Russia produces PA 6 for processing yarns and fibers, as well as, for compounding. The produced products are mainly supplied to foreign markets, as Russia does not require such quantities. The main consumers are the countries with well-developed light industry: India, China, Turkey.

Russia produces monthly 12,000 tonnes of PA 6, of which about 70% are exported. The needs of the Russian market in PA 6 for the textile industry are 2,000-3,000 tonnes per month.

According to Rosstat, production of Russia's textile and clothing industries rose by 98.7% in July 2014 year on year and by 106.0% from January to July 2014.

KuibyshevAzot is Russia's major producer and exporter of PA 6. The plant's annual production capacity of original PA was 135,000 tonnes in 2013. To date, it reached 150,000 tonnes. One of the plant's strategic objectives is providing domestic converters with affordable material of high quality.

MRC

MOSCOW (MRC) -- Shares of LyondellBasell Industries clocked a new 52-week high of USD110.67 on Aug 15, exceeding its previous high of USD110.49, said Zacks.

The stock pulled back a bit to end the trading session at USD110.60 on that day. The chemical giant, which has a market cap of around USD57 billion, has seen its shares rise roughly 40% so far this year, outperforming a roughly 7% rise in the S&P 500 for the period. Average volume of shares traded over the last three months is around 2,795.7K. The company’s long-term projected EPS growth is around 10.7%.

LyondellBasell’s profit for second-quarter 2014, reported on Jul 25, jumped around 27% year over year as it saw gains across all segments, especially the Olefins & Polyolefins – Americas division. Both revenues and earnings for the quarter comfortably beat Zacks Consensus Estimates. The company expects strong production of oil, natural gas and natural gas liquids (NGLs) in the U.S. to support margins going forward.

LyondellBasell, which emerged from Chapter 11 bankruptcy in 2010, continues to benefit from favorable North American natural gas environment and is executing its expansion projects to leverage the U.S. NGLs advantage.

LyondellBasell remains on track with its ethylene expansion projects. The company’s multi-plant ethylene expansion program, which started last year, represents a total investment of roughly USD1.3 billion across its Channelview, La Porte and Corpus Christi facilities which benefit from shale gas production. The expansion program, when in full swing, is expected to expand annual ethylene capacity by an estimated 1.85 billion pounds for an aggregate projected capacity of 11.8 billion pounds in North America.

LyondellBasell’s methanol plant at Channelview, TX (restarted in fourth-quarter 2013) along with its other major debottleneck projects (including expansion at La Porte) are expected to bring in new capacity at considerably lower cost than building new facilities. LyondellBasell expects to start production from the La Porte ethylene expansion project in the third quarter.

That said, LyondellBasell is exposed to volatility in raw material and energy costs and a still challenging European market.

As MRC wrote before, LyondellBasell Industries posted second-quarter earnings that topped analysts’ estimates as margins widened on higher prices. 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.

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

MOSCOW (MRC) -- OAO Gazprom, the only Russian gas exporter today, has written to the government asking it to block changes to the gas-export law that would let OAO Rosneft supply abroad from the Pechora LNG project in northern Russia, according to Hydrocarbonprocessing.

The bill "will strengthen the bargaining position of potential foreign buyers of Russian gas," creating excess competition among suppliers from the country, Deputy CEO Valery Golubev wrote to the Energy Ministry. The government already eroded Gazprom’s monopoly last year, allowing two planned LNG projects, one led by Rosneft, the right to ship fuel abroad.

Gazprom and Rosneft are maneuvering as Russian President Vladimir Putin is trying to shift energy exports toward Asia to benefit from economic growth and as the crisis in Ukraine damages relations with Europe. Oil producer Rosneft, led by Putin’s close ally Igor Sechin, has in turn lobbied for access to Gazprom’s planned pipeline to China.

Both current and new gas customers may put pressure on prices, cutting the state’s export duty revenue if Russia widens the number of suppliers, according to Golubev’s letter, written in late June. That was 282 billion rubles (USD8 billion) in the first half of the year, 4% of the state’s income, according to the Russian Treasury’s website.

China has already used the prospect of greater competition among Russia’s energy producers to gain the upper hand in negotiations over prices, Golubev’s letter said. Putin ended Gazprom’s monopoly on gas shipments from Russia last year, granting export rights to OAO Novatek’s planned Yamal LNG project and Rosneft’s proposed LNG plant in Sakhalin, Russia’s Far East. Gazprom currently maintains control over all export pipelines.

Russia needs an "effective mechanism for coordination of all exports" and to avoid overcapacity from "independent" gas-export projects, the letter said. The Moscow-based exporter signed its first 30-year supply contract with China on May 21 after more than a decade of talks, saying it will start negotiations on a new deal this year.

Russia’s parliament posted the proposed changes to the gas-export law May 26. The move would let Pechora LNG ship fuel abroad, the Ministry of Natural Resources said then. Parliament may start discussing the bill later this year, according to its website. By Sept. 1, the government is scheduled to report to Putin on whether it agrees on granting Rosneft access to the China gas pipeline, according to the Kremlin’s website.

Rosneft, which pumps 40% of Russia’s oil and 8 percent of gas, plans to get a majority stake in Pechora LNG project by next month, the company said May 23 after signing an agreement with owner Alltech Group. The plant, scheduled to start production as soon as 2018, may cost about USD4 billion and will export 2.6 million metric tons of LNG in the first phase from the Barents Sea coast, according to its website. The full capacity may reach as much as 10 million tons worth USD17 billion including infrastructure.

The Far East LNG project, which Rosneft plans to develop together with Exxon Mobil Corp, is expected to cost as much as USD8 billion and have 5 million tons of capacity at the first stage, starting production from 2018, according to Rosneft.

Gazprom, pumping more than 70% of Russia’s gas, has plans to expand its Sakhalin-2 project with Royal Dutch Shell Plc, which remains the country’s only producer of LNG. The Russian company is going to build an LNG plant in Vladivostok, Russia’s Far East, and a Baltic LNG project in the north-west of the country.
MRC

MOSCOW (MRC) -- Japanese materials firm Mitsubishi Rayon Co. Ltd. (MRC) has acquired a majority stake in Wethje Holding GmbH, a German producer of carbon-fiber-reinforced plastics (CFRP) for the auto market, said Plasticsnews.

Wethje currently is owned by Austrian industrial form Cross Industries AG. No purchase price for the 51% stake in Wethje that MRC is buying was included in an Aug. 15 news release announcing the deal.

Cross — based in Wels, Austria — employs 3,900 and posted sales of more than USD1.1 billion in 2013. Separate employee and sales totals for Hengersberg, Germany-based Wethje were unavailable. In the release, officials with Tokyo-based MRC said that the European auto industry, with its innovative center in Germany, "moves towards a full-scale adoption of CFRP parts."

As an example, officials cited BMW’s i3 electric vehicle, which uses CFRP parts for the complete vehicle structure.
"This development, together with stricter environmental policies, means a further strong push towards an increasing use of CFRP technology within the automotive industry," they said.

Wethje was founded in 1979 and uses both autoclave technology on small scale production and RTM technology for mid-scale serial production, MRC officials said, adding that MRC "will build a solid partnership with Cross by jointly owning Wethje on a long-term basis."

MRC will use Wethje as a development and production base for CFRP parts and will further strengthen the supply chain of the carbon fiber intermediates business for auto applications in Europe, officials said.

As MRC wrote before, Mitsubishi Rayon Co. (MRC) and Mitsui & Co. have signed a memorandum of understanding to undertake detailed feasibility studies for establishing a joint venture in the U.S. to build a methyl methacrylate (MMA) monomer unit. The plant, for which a specific location has not yet been decided, is expected to have 250,000 t/y of MMA capacity based on the Alpha technology developed by MRC's Lucite International subsidiary.

MRC employs more than 9,000 worldwide. Its plastic products include acrylic resin and sheet.
MRC