Iran becomes No. 2 oil supplier to S. Korea in Q1 2017

MOSCOW (MRC) -- Iran ranked as South Korea's second-biggest oil exporter over the first three months of 2017 as it ramped up output to regain market share after sanctions were lifted last year, the first time ever it has claimed the No. 2 spot on a quarterly basis, said Reuters.

South Korea's March imports from Iran more than doubled from a year ago to a record 18.54 MMbbl, or 597,935 bpd, data from state-run Korea National Oil Corp (KNOC) showed on Monday.

For the January–March period of 2017, Iran seized the No. 2 spot with shipments of 46.73 MMbbl, also more than double from the same period last year and the highest on record for a quarter.

"South Korea couldn't bring crude from Iran for a while because of sanctions though it used a lot of Iranian crude in the past. But now as the sanctions are lifted ... crude from Iran will keep flowing," Kim Jae-kyung, research fellow at state-run Korea Energy Economics Institute, said on Tuesday.

This year's surge in Iranian crude also came after Tehran was exempted from production cuts led by the Organization of the Petroleum Exporting Countries (OPEC) to clear a global glut.

Iran's jump to the No. 2 spot is due as well to solid condensate demand from South Korean refiners such as SK Energy and Hyundai Oilbank.

In the first quarter of 2016, Iran was South Korea's fifth-biggest oil supplier behind Saudi Arabia, Iraq, Kuwait and Qatar, according to KNOC data.

Saudi Arabia held onto its spot as South Korea's top oil supplier for both March and the full quarter. Shipments from Saudi Arabia rose 10.8% in March from a year ago to nearly 26 MMbbl, or 838,387 bpd, from 23.46 MMbbl last year.

In the first quarter, the world's top oil exporter shipped 77.12 MMbbl of crude to South Korea, up 4.4% from about 74 MMbbl in the same period of 2016, according to the data.

Overall, South Korea's March imports increased 11.7% from a year ago to 95.9 MMbbl, or 3.09 MMbpd, the data showed.

The world's fifth-largest crude importer brought in 278.18 MMbbl of crude in the first three months of 2017, up 4.9% from 265.3 MMbbl last year.
MRC

European Commission set to reject anti-dumping duty request on Korean PTA

MOSCOW (MRC) -- The European Commission is set to reject a request to place anti-dumping duties on imports of purified terephthalic acid from South Korea, market sources said Friday, reported Apic-online.

"The duties remain at 0%, they have rejected the claim," a trader said. "It happened on April 11."

But the EC's official journal indicates the investigation is still under way.

"The case is still ongoing. Disclosure to interested parties has taken place and the Commission is still waiting for their comments," an EC spokesperson said Friday.

Nevertheless, the trader said buying interest in Europe for South Korean PTA had risen as a result ahead of the official decision.

The anti-dumping investigation into PTA imports from South Korea was launched by the EC in August 2016, following a complaint by three European PTA producers: BP Aromatics, Artlant PTA and Indorama Ventures Quimica, which together account for around half of the EU's PTA nameplate production capacity.

Market participants said prices for South Korean PTA had been very competitive in the past and had found a strong customer base among EU PET producers, most of who were contractual buyers.

The intense competition had kept profit margins very weak for EU PTA producers. It also kept Portugal's Artlant's PTA plant in Sines idled since November 2015, having previously restarted for just a month in October that year after remaining shut for around 16 months.

The EC's investigation was set to conclude within 15 months, a period that ends on November 3, 2017. Provisional measures, if any, are scheduled to be imposed within nine months, by May 3, 2017.

As MRC wrote before, in August 2017, China continued anti-dumping duties on a commodity chemical imported from the Republic of Korea (ROK) and Thailand. The tariffs on PTA became effective for another five years on 11 Aug 2016, with rates ranging from 2% to 20.1%. The ruling was made after official surveys showed that damage to the domestic industry would reoccur if the tariffs were terminated, the notice said. The ministry started imposing anti-dumping duties on the industrial organic compound in 2010.
MRC

Sinopec Qilu brought on-stream LDPE plant in China

MOSCOW (MRC) -- Sinopec Qilu Petrochemical has brought on-stream its low density polyethylene (LDPE) plant following a maintenance turnaround, as per Apic-online.

A Polymerupdate source in China informed that the company has resumed operations at the plant on April 24, 2017. The plant was shut for maintenance on March 6, 2017.

Located at Shandong province in China, the LDPE plant has production capacities of 140,000 mt/year.

As MRC informed before, Sinopec group, parent of Sinopec Corp, will invest USD29.05 billion to upgrade four refining bases between 2016 and 2020 to produce higher-quality fuels. Sinopec's upgrades come as China, the world's second-biggest oil consumer, is embracing more stringent fuel standards in its battle against pollution and suffering an overall glut in refining capacity. After the upgrades, the total refining capacity of the four refining sites will reach 130 MMtpy, or 2.6 MMbpd, while ethylene capacity will reach 9 MMtpy.

China Petrochemical Corporation (Sinopec Group) is a super-large petroleum and petrochemical enterprise group established in July 1998 on the basis of the former China Petrochemical Corporation. Sinopec Group's key business activities include the exploration and production of oil and natural gas, petrochemicals and other chemical products, oil refining.
MRC

Covestro Q1 profit beats market view on strong construction business

MOSCOW (MRC) -- Covestro, the plastics maker that parent Bayer plans to divest, reported a larger-than-forecast profit gain for the first quarter, on stronger volumes and prices of foam chemicals used in the construction industry, said Reuters.

Quarterly earnings before interest, taxes, depreciation and amortisation (EBITDA), rose by two thirds to 846 million euros (USD919 million), above the 761 million euros expected on average in a Reuters poll of analysts.

Covestro said it now sees the return on capital employed (ROCE) in 2017 clearly above 2016 levels, where it had previously seen a slight increase.

As MRC informed earlier, Covestro has announced that it will continue manufacturing MDI in Tarragona, Spain. The plant closure that had originally been planned for the end of 2017.

Covestro (formerly Bayer MaterialScience) is an independent subgroup within Bayer. It was created as part of the restructuring of Bayer AG from the former business group Bayer Polymers, with certain of its activities being spun off to Lanxess AG. Covestro manufactures and develops materials such as coatings, adhesives and sealants, polycarbonates (CDs, DVDs), polyurethanes (automotive seating, insulation for refrigerating appliances) etc.
MRC

Shipments of Iranian PC to Russia resumed

MOSCOW (Market Report) -- After eight months of a break, shipments of Iranian polycarbonate (PC) were resumed to the Russian market, an Iranian trader told MRC.

He said he intends to focus on PC sales to Turkey and Russia in the coming months.

Import prices of the first lot of material will be at USD2,400-2,420/tonne CPT Astrakhan, excluding VAT. PGPC-0407 and PGPC-0710 grades at a total volume of 225 tonnes are scheduled for delivery.

April domestic prices for Kazanorgsintez's PC remained at the same level - Rb185,000-186,000/tonne CPT Moscow, including VAT.
MRC