European PVC increased by EUR40/tonne for CIS markets in May

MOSOCW (MRC) - Negotiations on European polyvinyl chloride (PVC) prices for May delivery into the CIS markets began last week. All producers announced a further increase in May export PVC prices, according to ICIS-MRC Price Report.

European contract price of ethylene for May delivery was agreed up by EUR40/tonne from April level, which increases the production cost of PVC by about EUR20/tonne. Nevertheless, the majority of European producers have announced a more significant rise in May export price of PVC for CIS countries than the increase in production costs.

Negotiations on May deliveries of suspension polyvinyl chloride (SPVC) for the CIS markets were done last week in the range of EUR760-800/tonne FCA, while the April deals were done in the range of EUR720-780/tonne FCA.
Such a significant growth in export PVC prices in Europe was a result of a strong domestic demand and limited supply in the world market because of production shutdowns in the USA and problems in production in Mexico.

MRC

Arkema posts rise in Q1 2016 net profit

MOSCOW (MRC) -- Arkema, a France-based chemical manufacturer and the world's second leading producer of organic peroxides, said its revenue and core earnings grew in the first quarter 2016, driven by robust sales at its Bostik glue unit and strong performance by its thiochemicals platform in Malaysia, as per the company's report.

First-quarter revenue rose 1.2 percent to 1.89 billion euros, while EBITDA was up 27.4 percent at 302 million euros, the company said in a statement on Wednesday.

First-quarter net income group share rose 133.3 pct to 98 million euros, the company said.

On average, analysts were expecting first-quarter revenue of 2.01 billion euros and EBITDA of 280 million euros, according to Thomson Reuters I/B/E/S Estimates.

"This performance illustrates our internal momentum sustained by transforming investments which continue to ramp up, like Bostik integration and the development of thiochemicals in Malaysia," Chairman and CEO Thierry Le Henaff said in the statement.

Arkema confirmed it expects EBITDA to grow in 2016.

As MRC informed earlier, on June 4 2015, Arkema officially inaugurated the thiochemicals plant, which successfully came on stream in Kerteh, Malaysia, beginning of 2015. This world-scale thiochemicals platform produces methyl mercaptan, a synthesis intermediate for animal feed, as well as dimethyl disulfide (DMDS). The facility strengthens Arkema's position as the world leader in high added value sulfur derivatives, and is fully consistent with the GroupпїЅs growth strategy in Asia. The construction of the new plant represented investments of some EUR200 million for the Group.

Arkema with annual revenue of EUR6.7 billion is a leading European supplier of chlorochemicals and PVC. Kynar and Kynar Flex are registered trademarks of Arkema Inc. Arkema operates 11 organic peroxide plants on the three continents.
MRC

Bio-based PET market estimated at 5.8 mln tons by 2020

MOSCOW (MRC) -- Global bio-based polyethylene terephthalate (PET) market is expected to reach 5,800 kilo tons by 2020, according to Plastemart with reference to a study by Grand View Research, Inc.

Volatile crude oil prices and growing sustainable packaging market have fuelled bio-based PET market growth in packaging, automotive and electronic applications. Growing GHG emission concerns has fuelled demand for eco-friendly substitute, which is expected to boost bio-based PET market growth in the near future. Companies such as The Coca Cola Company, Heinz & Co., Ford Motors, Nike Co. and Proctor & Gamble have signed Plant PET Technology Collaborative (PTC), intended for development and use of 100% bio-based PET in their product offerings. These developments are expected to provide new market opportunities over the forecast period.

Bio-based PET was predominantly used for the packaging of CSD (Carbonated Soft Drinks), accounting for more than 75% of market share in 2013. Growing beverage consumption in emerging markets of BRICS is expected to drive bio based PET market growth. CSD marketing companies such as Coca-Cola are committed on promoting the use of bio-based PET in packaging, which is expected to have a major impact on market growth in the near future.

Bio based PET is also used in technical applications such as electronics and automotive vehicles. Growing demand for lightweight material in automobiles is expected to propel bio-based plastics demand, resulting in bio-based PET market growth over the forecast period. Asia Pacific accounted for over 30% of global bio based PET demand in 2013.

The Japanese government’s target of 20% of bio-based plastics consumption by 2020 coupled with application growth of packaging and technical applications in China and India is expected to boost regional market growth over the next six years. European Commission has included bio-based production as a key priority area intended for increasing industry share in EU’s GDP from 15% to 20%, which in turn is expected to provide new opportunities for the market in the near future.

The market is expected to be highly competitive, on account of limited presence of manufacturers such as Coca-Cola Company, Toyota Tsusho and Teijin Limited. Raw material manufacturers including Gevo, Virent and Anellotech have invested in the development of fully bio-based PTA, intended for 100% bio-based PET production.

As MRC informed previously, the global bio-based PET market is expected to grow at 68.25% CAGR by 2019 as per ReportsnReports. Bio-based PET is a biodegradable product made from materials such as monoethylene glycol (MEG) and terephthalic acid (PTA). About 30% of bio-based PETs are composed of monoethylene glycol (MEG), a product of sugarcane ethanol, and the rest is composed of purified terephthalic acid (PTA), a chemical-based product of crude oil.
MRC

Sinopec pioneers new technology from Honeywell UOP to raise yields of petrochemicals in China

MOSCOW (MRC) -- Honeywell has announced that the first commercial installation of its UOP MaxEne Process successfully entered production at Sinopec Yangzi Petrochemical Company's (YPC) integrated refinery and petrochemical facility in Nanjing, China, said the company on its site.

The new technology from Honeywell UOP generates substantially higher yields of the chemical components used to make plastics, and has processed more than 2.5 mln metric tons of naphtha feed since entering production, meeting all of its performance criteria, including yield quality and quantity. The facility is a cooperative project between the company and Sinopec to jointly commercialize the process based on Honeywell UOP's pilot plant technology. In addition to licensing, Honeywell UOP provided the basic engineering, key equipment, adsorbents and technical support for the unit.

"The success of first commercial installation at Sinopec YPC demonstrates how MaxEne technology can help producers to make better use of limited naphtha, improve petrochemical yields and increase profitability," said Mike Millard, vice president and general manager of Honeywell UOP's Process Technology and Equipment business unit. "Through collaboration with YPC, Sinopec Tech and Sinopec Engineering, we advanced the boundaries of the technology to better meet the growing demand for petrochemicals and transportation fuels." Worldwide, naphtha is the most common feedstock used for the production of gasoline, aromatics and light olefins such as ethylene and propylene. But refiners lack the flexibility to switch production between these products.

The MaxEne process separates full-range naphtha into a stream rich in normal paraffins, and a second stream of iso-paraffins, naphthenes and aromatics. The normal paraffins are ideal for steam crackers because they produce high yields of light olefins. The remaining components are perfect for catalytic reforming units because they produce high yields of aromatics, which are the building blocks for solvents, detergents and other materials. The process results in up to a 40 percent higher yield of ethylene from an existing naphtha cracker with no loss in propylene. It also produces 5 percent more reformate for blending into gasoline or up to 10 percent more aromatics.

We remind that, as MRC wrote previously, Sinopec Yangzi Petrochemical shut its linear low density polyethylene (LLDPE) plant for maintenance turnaround in end-July 2015. It remained off-stream for around one month. Located at Nanjing in China, the plant has a production capacity of 200,000 mt/year.

Sinopec Yangzi Petrochemical Co. Ltd. (formerly Yangzi Petrochemical Co., Ltd.) is a wholly-owned subsidiary under the China Petroleum & Chemical Corporation. The company is primarily engaged in refining crude oil, and producing and marketing hydrocarbon derivatives. It is one of the largest suppliers of pure benzene, paraxylene, orthoxylene, PTA, polyethylene, polypropylene, ethylene glycol, butadiene and ethylene oxide in China.

Sinopec Tech (formerly Sinopec Technology Company) is a holding subsidiary of China Petroleum & Chemical Corporation (SINOPEC) that licenses proprietary refining and petrochemical technologies, and provides technical services, including engineering and consulting to clients worldwide.
MRC

Moodys upgrades Evonik to Baa1 with stable outlook

MOSCOW (MRC) -- The rating agency Moody’s upgraded the credit rating of Evonik Industries AG from Baa2 with a positive outlook to Baa1 with a stable outlook, as per the company's press release.

The rating upgrade followed our announcement to acquire the specialty & coating additives business (Performance Materials Division) of Air Products and Chemicals, Inc.

The agency expects that the acquisition will enhance the specialty chemicals franchise of Evonik and strengthen Evonik’s business profile by adding scale and diversity.

Ute Wolf, CFO of Evonik comments: "The rating upgrade from Moody’s acknowledges our consistent strategy towards a portfolio of high-margin resilient businesses.

Maintaining a solid investment grade rating forms a central element of Evonik’s corporate strategy."

The rating agency Standard & Poor’s already confirmed the credit rating of Evonik Industries AG at BBB+ with a stable outlook on May 6, 2016.

As MRC informed earlier, in June 2015, Evonik Industries completed the acquisition of Monarch Catalyst (Dombivli, India). Evonik announced plans to acquire Monarch Catalyst in March, subject to certain closing conditions. The company employs approximately 300 people and will be renamed Evonik Catalysts India. All of Evonik’s future catalyst activities in India will be operated through the newly acquired company. Financial details of the transaction were not disclosed.

Evonik, the creative industrial group from Germany, is one of the world leaders in specialty chemicals. Its activities focus on the key megatrends health, nutrition, resource efficiency and globalization. Evonik benefits specifically from its innovative prowess and integrated technology platforms. Evonik is active in over 100 countries around the world.
MRC