Scheduled maintenances at Russian plants led to another record in LDPE prices

MOSCOW (MRC) -- August scheduled outages for maintenance at Russian producers of low density polyethylene (LDPE) led to further price increases, despite weak demand from converters. Prices of 158 grade LDPE were very close to Rb80,000/tonne in late August, according to ICIS-MRC Price report.

A series of scheduled shutdowns for a turnaround at Russian LDPE producers began in July 2014. Outages for maintenance continued in August, Kazanorgsintez also operated at a reduced capacity utilisation. All these factors in August, despite weaker demand for polyethylene (PE) from most converters, led to a further price rise. LDPE prices broke all historical records at the end of the month.

This month's schedule of planned shutdowns for maintenance works looks as follows.

Angarsk Polymer Plant shut down its LDPE production for a one-month turnaround in early August. However, the outage at the plant did not affect the balance of the Russian market, because over 80% of the Angarsk PE are exported. Ufaorgsintez stopped its second LDPE reactor (158 grade and 153 grade PE) for a three-week maintenance from 15 August, the first LDPE reactor will be shut down for maintenance from 27 August to 24 September.

Kazanorgsintez also plans to stop its LDPE production for maintenance works from 16 September until the end of the month.

SIBUR announced an increase Rb1,000/tonne from mid-August in its contract LDPE prices on Monday. Other Russian producers have not yet announced their intentions regarding September contract prices.

Supply of high density polyethylene (HDPE) was tight in the spot market virtually during the whole August. This week's offer prices of 158 grade LDPE were in the range of Rb77,000-80,000/tonne CPT Moscow, including VAT. Offer pricess of shrinkable film grade PE already exceeded Rb80,000/tonne CPT Moscow, including VAT.

Most market participants said September will also be difficult enough for the Russian LDPE market. And, first of all, it will be due to low capacity utilisation and a subsequent outage at Kazanorgsintez, as well as maintenance works at Ufaorgsintez.
MRC

MOSCOW (MRC) -- The overall production of unmixed polyvinyl chloride (PVC) in Russia decreased by 1% over the first seven months of 2014. The main reason for the reduced output was a reduction of capacity utilisation at SayanskKhimplast, according to MRC ScanPlast.

The overall July production of unmixed PVC (suspension and emulsion) totalled about 57,000 tonnes in Russia (56,100 tonnes in June). The total output of resin by Russian producers decreased to 379,400 tonnes from January to July 2014 from 381,700 tonnes a year earlier. This year's higher capacity utilisation of Bashkir Soda Company and Kaustik (Volgograd) did not allowed to fully offset the reduced production of Sayanskkhimplast.

The PVC production structure in Russia by plants looks the following way over the stated period.

Sayanskkhimplast, Russia's largest suspension PVC (SPVC) producer, slightly increased its resin output in July to 27,400 tonnes (27,300 tonnes in June). The overall plant's PVC production dropped to 179,600 tonnes over the first seven months of 2014 from 180,700 tonnes a year earlier.

Bashkir Soda Company (formerly Kaustik (Sterlitamak) increased its last month's production to 19,700 tonnes versus 19,100 tonnes in June. The Bashkir company increased its SPVC production from January to July 2014 to 132,800 tonnes, up by 6% year on year.

Kaustik (Volgograd) produced 8,100 tonnes of emulsion PVC (EPVC) in July (8,000 tonnes in June). The plant increased its SPVC production to 56,100 tonnes over the stated period versus 55,000 tonnes a year earlier.

Volgograd Khimprom, still the only EPVC rpoducer in Russia, increased its last month's production of resin to 1,800 tonnes from 1,700 tonnes in June. The overall plant's EPVC production rose by 10% over the first seven months of the year and totalled about 11,000 tonnes because of the plant's operations without maintenances.

As already reported, RusVinyl (Nizhny Novgorod region, a joint venture between SIBUR and Solvin) will officially launch PVC production with the annual capacity of 300,00 tonnes in the first decade of September.

MRC

MOSCOW (MRC) -- The overall polyethylene (PE) imports to the Republic of Belarus decreased over the first six months of 2014 by 10% year on year. Demand for high density polyethylene (HDPE) subsided, whereas demand for other PE grades increased, reported MRC analysts.

June PE imports into Belarus were 9,700 tonnes versus 10,600 tonnes because of reduced HDPE shipments from Russia. The overall PE imports fell from January to June 2014 to 48,600 tonnes versus 54,000 tonnes over the same period a year earlier.

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

June imports of low density polyethylene (LDPE) and linear low density polyethylene (LLDPE) rose to 5,200 tonnes from 4,600 tonnes in May under the pressure of seasonal factors. The overall imports of these PE grades reached from January to June 23,700 tonnes versus 22,500 tonnes a year earlier. Producers from Russia and Saudi Arabia are the main PE suppliers to the local market.

HDPE imports dropped to 4,500 tonnes in June from 5,900 tonnes in May on the back of reduced shipments from Russia. The overall HDPE imports to Belarus totalled 24,900 tonnes over the said period, down by 20.8% year on year.
MRC

MOSCOW (MRC) -- PTT Global Chemical (PTTGC) is in plans to shut its I4-No. 2 gas cracker for maintenance turnaround, according to Apic-online.

A Polymerupdate source in Thailand informed that the cracker is planned to be shut in the first week of September 2014. It is likely to remain off-stream for around one month.

Located at Map Ta Phut in Thailand, the cracker has a capacity of 400,000 mt/year.

As MRC reported earlier, this week, PT Indo Thai Trading (ITT) launched operations as a joint venture of Indonesia's Pertamina and Thailand’s PTT Global Chemical (PTTGC). ITT will be responsible for the marketing and sales of all production from this complex.

PTT Global Chemical is a leading player in the petrochemical industry and owns several petrochemical facilities with a combined capacity of 8.45 million tonnes a year.
MRC

MOSCOW (MRC) -- Belgian PVC window frames maker Deceuninck plans to raise EUR50 million (USD66 million) in a private placement of new shares to fund the purchase of Pimas in Turkey and future acquisitions, as per Reuters.

Deceuninck said on Tuesday it would issue 26.3 million shares at EUR1.90 euros apiece and that these were already allocated to investors Gramo and Sofina, which would respectively own 21.01% and 17.5% of the group after the transaction.

On Monday, the group said it would buy an 81% stake in Turkish company Pimas for USD26.5 million.

"The balance will enable Deceuninck to undertake further strategic projects and investments in a consolidating industry," Deceuninck said in a statement.

As MRC informed previously, in early 2014, Deceuninck North America, a leading designer and manufacturer of high-quality systems for windows, doors, and outdoor living, added three PVC lineal lamination lines to its existing lamination capabilities to meet consumer demand for a wider variety of color customization options.

Deceuninck NV is a Belgian designer and producer of PVC systems for windows and doors, interior, roofline & cladding and terraces. The company extrudes PVC and the single base material Twinson. Founded in 1937, with its headquarters in Hooglede-Gits, the Deceuninck Group operates in more than 75 countries and has 35 subsidiaries across Europe, North America and Asia, including the United States, United Kingdom, Russia and Turkey.
MRC