HDPE imports into Russia decreased by 22% in January - November 2016

MOSCOW (MRC) - Total imports of high density polyethylene (HDPE) into Russia decreased to about 137,500 tonnes in the first eleven months of 2016, down 22% compared to the same period of 2015. Reduction of imports was seen in all segments of consumption, the exception was the film and blow moulding polyethylene, according to MRC DataScope.

November imports of HDPE into Russia reduced to 11,700 tonnes, compared with 12,800 tonnes a month earlier, the main decline in purchases accounted for extrusion blow moulding PE, production of films and injection moulding sector. Total HDPE imports into Russia decreased to 137,500 tonnes in the first eleven months of the year, compared with 177,000 tonnes in the same time a year earlier. The greatest reduction in external supplies recorded in the segment of pipe extrusion, and extrusion coating of steel pipes of large diameter, while import of film and blow moulding HDPE, on the contrary, has grown.

Structure of HDPE supply over the reported period looked as follows.

November imports of injection moulding PE fell to 2,600 tonnes from 3,500 tonnes a month earlier, the main decrease in imports accounted for South Korean and Uzbek PE. Total imports of injection moulding HDPE in to the country were about 33,800 tonnes in the first eleven months of the year, compared with 42,700 tonnes a year on year.

November imports of HDPE for extrusion blowmoulding into the country reduced practically three times against October to about 900 tonnes.
Total imports of HDPE for extrusion blow moulding into the country increased to 26,500 tonnes in January - November 2016, compared to 23,700 tonnes year on year, with main increase accounted for Uzbek PE.

November imports of film HDPE dropped to 1,900 tonnes from 2,900 tonnes in the previous month. Total imports of film HDPE into the country increased to 24,000 tonnes in January-November 2016, compared to 17,000 tonnes a year earlier.

The last month's production of pipe HDPE remained practically at the level of October and was about 1,600 tonnes. Russia's pipe HDPE imports in the first eleven months of the year decreased to 20,500 tonnes, down 47% year on year. The main reasons for the fall in import volumes were increased domestic production and reduced the demand for pipes.

November imports of HDPE for extrusion coating of steel pipes of large diameter increased to 3,900 tonnes, whereas the previous month this figure has not exceeded 1,600 tonnes. Imports of this type of polyethylene fell by 49% to 21,900 tonnes in the first eleven months of this year, partly because of the growth of local production.

Russia's imports of HDPE in other consumption sectors decreased to 10,700 tonnes in the first eleven months of the year compared with 10,700 tonnes year on year.


MRC

Rosneft and ChemChina to set up a JV to build a polymeric coatings plant

MOSCOW (MRC) -- Rosneft and the China National Petrochemical Company (ChemChina) signed a Heads of Agreement on establishing a Joint Venture, said the company on its site.

The document was signed by Rosneft Chief Executive Officer Igor Sechin, and General Manager of ChemChina Yang Xingqiang.

According to the terms of the document, the parties will establish a joint venture in the Bolshoy Kamen priority development territory in Primorsky Krai, Russia, to build a plant and a polymer coatings and paints facility with an annual capacity of 50 thousand tons, as well as implement R&D activities. In that regard, Rosneft and ChemChina will conduct a feasibility study of the project and carry out the necessary preparations to set up a joint venture. As a result of the project implementation, the largest facility to produce special marine and arctic vessel coatings, a leader in this segment, will be established in Russia.

The plant’s production will find its application at the Zvezda shipbuilding complex in the Russian Far East, being constructed under the order of the President of Russia Vladimir Putin. In particular, Rosneft and ChemChina will establish a working group to develop new polymer coatings for ships of various classes, including Arctic class vessels.

As it was informed earlier, in September 2016, Rosneft and ChemChina signed a Heads of Agreement on cooperation in equity investment in ChemChina Petrochemical Corporation (CCPC) and a Memorandum of Understanding for cooperation on the project of the Far-East Petrochemical Company (FEPCO).

ChemChina is one of the largest chemical companies in the world. The company's business is focused on the production of new and special chemical materials, basic chemicals, oil refining, agricultural chemistry, rubber products, and chemical equipment.

ChemChina Petrochemical Co. Ltd is a subsidiary of ChemChina, and engaged in the production of petrochemical products; the installed capacity of hydroskimming is 25 million tons of crude oil per year.

Rosneft became Russia's largest publicly traded oil company in March 2013 after the USD55 billion takeover of TNK-BP, which was Russia’s third-largest oil producer at the time.
MRC

PVC production in Russia down 1% in the first eleven months of 2016

MOSCOW (MRC) -- Russia's overall output of unmixed polyvinyl chloride (PVC) dropped in the first eleven months of 2016 by 1% year on year, exceeding 701,200 tonnes. Only RusVinyl and Bashkir Soda Company showed a positive dynamics, according to MRC's ScanPlast report.


November production of unmixed PVC in Russia rose to 74,200 tonnes from 62,000 tonnes a month earlier, with RusVinyl and Bashkir Soda Company, which shut down their production capacities for a scheduled turnaround in October, accounting for a major increase in production. Overall PVC production exceeded 701,200 tonnes in January-November 2016, compared to 711,600 tonnes a year earlier. RusVinyl raised its output by 30%, Bashkir Soda Company - by 3%, whereas SayanskKhimplast and Kaustik Volgograd reduced their production of resin.

The structure of PVC production by plants looked the following way over the stated period.


RusVinyl (joint venture of SIBUR and SolVin) produced about 29,500 tonnes of PVC in November, 2,200 tonnes of which accounted for emulsion polyvinyl chloride (EPVC), compared to 20,900 tonnes a month earlier. As reported previously, RusVinyl shut down its production capacities for a scheduled maintenance in the second half of September - early October. RusVinyl's total PVC production exceeded 275,000 tonnes in the first eleven months of 2016, whereas this figure was 210,9000 tonnes a year earlier.

Bashkir Soda Company produced over 21,600 tonnes of suspension polyvinyl chloride (SPVC) last month, whereas this figure was slightly more than 13,700 tonnes in October (the plant was shut for a short turnaround in October). The Bashkir plant's overall output of resin exceeded 226,000 tonnes in January-November 2016, up by 3% year on year.

Kaustik (Volgograd) showed a slight decrease in its output in November, last month's total SPVC production was 7,600 tonnes, compared to 8,000 tonnes a month earlier. The plant's overall production of resin reached 80,400 tonnes in the first eleven months of 2016, down by 8% year on year. Lower output was largely caused by a long turnaround in May-June.

SayanskKhimPlast reduced its capacity utilisation last month, the plant's SPVC production reached 15,600 tonnes, whereas this figure was 19,400 tonnes in October. The Sayansk plant managed to produce only 119,800 tonnes of resin in the fist eleven months of 2016, compared to 193,2000 tonnes a year earlier. The major reduction in production was due to a forced long shutdown in February-July because of an emergency outage at the ethylene unit of Angarsk Polymer Plant, the only ethylene supplier.

MRC

BASF completes acquisition of Chemetall

MOSCOW (MRC) -- BASF has completed its acquisition of Albemarle’s global surface treatment business, Chemetall. Through this acquisition, BASF’s Coatings division expands its portfolio to become a more complete solutions provider, as per the company's press release.

BASF combines its knowledge in chemistry and coatings applications with Chemetall’s expertise in surface treatment. The combined businesses will benefit from each other’s global infrastructure, scale and market access, driving new growth opportunities by offering an unmatched solutions competence to customers.

"We are extending a warm welcome to our new colleagues. The acquisition of Chemetall allows us to significantly expand our market. By combining the expertise and innovation power of two global market leaders, we will accelerate innovation and make our customers even more successful," said Markus Kamieth, President of BASF’s Coatings division.

Chemetall develops and manufactures customized technology and system solutions for surface treatment. Their products protect metals from corrosion, facilitate forming and machining, allow parts to be optimally prepared for the painting process and ensure proper coating adhesion. These chemicals are used in a wide range of industries and end-markets, such as automotive, aerospace, aluminum finishing, and metal forming. Chemetall’s sales for the full calendar year of 2015 were USD845 million.

As MRC wrote previously, BASF will strengthen its local production capability for waterborne and solventborne coatings in Thailand by building a new manufacturing facility at its Bangpoo site. The new production facility complements the facilities at the new Coatings Technical Competence Center ASEAN, which was opened in September 2015 and includes a laboratory for product development, performance testing, color design, as well as a small batch production unit. The expansion will better serve the strong demand from the expanding automotive industry in ASEAN.

BASF is the leading chemical company. It produces a wide range of chemicals, for example solvents, amines, resins, glues, electronic-grade chemicals, industrial gases, basic petrochemicals and inorganic chemicals. The most important customers for this segment are the pharmaceutical, construction, textile and automotive industries. BASF generated sales of more than EUR70 billion in 2015.
MRC

CNOOC to start new Huizhou refinery in Q2, plans Saudi supply

MOSCOW (MRC) -- China National Offshore Oil Corp, or CNOOC, is expected to start operating a new refinery in southern China in the second quarter of 2017, with Saudi Arabia as the potential crude supplier, said Reuters.

The 200,000 bpd plant is the first new refinery addition by a state-owned energy company since early 2014, and would add to the growing fuel surplus in China as independent refiners increased their output after they were granted crude import licenses last year, pushing the country's refinery output to a record in November.

"The new plant is slated for start-up around May or June ... with a configuration geared to process medium-sour grades, typically Arab Medium from Saudi Arabia and similar grades from Kuwait," said a Beijing-based industry official.

"CNOOC has lined up a framework supply deal with (Saudi) Aramco a while ago, although parties have not fixed the volumes yet."

Such a deal, if executed, would boost Saudi's market share in the world's second-largest oil consumer in order to compete with exporters Russia and Iraq.

The new 200,000-bpd plant will lift CNOOC's crude processing capacity at the site in the coastal city of Huizhou to 440,000 bpd.

Spokespersons at CNOOC and Aramco did not immediately respond to requests for comments.

The upgrade also includes a new petrochemical complex with a 1 MMtpy ethylene facility due to start possibly in the second half of 2017 that will double Huizhou's ethylene capacity to 2 MMtpy, said the sources.

The petrochemical expansion is a 50-50 JV with Royal Dutch Shell.

CNOOC is the parent of Hong Kong-listed offshore oil and gas producer CNOOC Ltd.

As MRC informed earlier, Shell Nanhai B.V. (Shell) and China National Offshore Oil Corporation’s (CNOOC) 50:50 JV has officially assumed ownership of CNOOC’s ongoing project to build an ethylene cracker and several derivatives units, after receiving all the necessary government approvals.

China National Offshore Oil Corporation (CNOOC Group Chinese) is one of the major national oil companies of China. It is the third-largest national oil company in the People's Republic of China after CNPC (parent of PetroChina), and China Petrochemical Corporation (parent of Sinopec).The CNOOC Group focuses on the exploitation, exploration and development of crude oil and natural gas offshore of China.
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