Covestro raises prices for elastomer products

MOSCOW (MRC) -- Effective May 1st, 2017, Covestro will raise the selling prices for its Desmodur and Baytec elastomer systems, which include prepolymers, polyols and curatives, by up to 9%, said the producer on its site.

The magnitude varies depending upon the product line.

The price increase will be applied globally as contracts allow.

Customers will be contacted by Covestro Elastomers’ Sales Representatives to address the price increase for their specific products.

As MRC wrote before, Covestro is moving forward with a repurposing of its production operations in Brunsbuttel, Germany. In July 2016, the Board of Management officially approved an expansion of production capacity for the foam component MDI (feedstock for polyurethane) at the site. An existing, idled plant for the precursor TDI will be converted for production of MDI. The plans call for roughly doubling production capacity at the site to a total of approximately 400,000 metric tpa of MDI. Commissioning of the new plant complex is scheduled for late 2018.

With 2016 sales of EUR 11.9 billion, 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. Covestro has 30 production sites around the globe and employs approximately 15,600 people (full-time equivalents) as of the end of 2016.
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Valero Energy quarterly profit slumps 38.4 pct

MOSCOW (MRC) -- Valero Energy Corp, the largest U.S. oil refiner, reported a 38.4 percent fall in quarterly profit, hurt by weak margins in its core refining business, said Reuters.

The company said on Tuesday that its net income attributable to shareholders fell to USD305 million, or 68 cents per share, in the first quarter ended March 31, from USD495 million, or USD1.05 per share, a year earlier.

Operating revenue rose 38.6 percent to USD21.77 billion.

As MRC informed earlier, Valero Energy Partners’ (the Partnership) board of directors of its general partner has approved the Partnership’s acquisition of the Meraux and Three Rivers Terminal Services Business from a subsidiary of Valero Energy Corp. (Valero) for total consideration of approximately USD325 M.

Valero Energy Corporation is a Fortune 500 international manufacturer and a marketer of transportation fuels, other petrochemical products, and power. It is based in San Antonio, Texas, United States. The company owns and operates 16 refineries throughout the United States, Canada, United Kingdom, and the Caribbean with a combined throughput capacity of approximately 3 million barrels (480,000 m3) per day, 10 ethanol plants with a combined production capacity of 1.2 billion US gallons (4,500,000 m3) per year, and a 50 megawatt wind farm.
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Ineos Q1 earnings up on cheap feedstocks

MOSCOW (MRC) -- Ineos Group Holdings S.A. announced its trading performance for the first quarter of 2017, said the company on its site.

Based on unaudited management information INEOS reports that EBITDA for the first quarter of 2017 was a record EUR753 million, compared to EUR554 million for Q1, 2016 and EUR559 million for Q4, 2016.

North American markets have continued to be strong, taking full benefit from their current feedstock advantage. Market conditions in Europe have remained good, supported by the continued weakness of the Euro. In addition, markets in Asia have seen some strength in the quarter.

O&P North America reported EBITDA of EUR284 million compared to EUR229 million in Q1, 2016. The business has continued to benefit from its flexibility to be able to utilise cheaper NGL feedstocks to maintain healthy margins. The US cracker business environment was solid with healthy margins and high operating rates throughout the quarter. Polymer demand was strong, with balanced markets and high margins.

O&P Europe reported EBITDA of EUR221 million compared to EUR175 million in Q1, 2016. Demand for olefins in the quarter was solid in a tight market with top of cycle margins. Butadiene prices in particular have remained elevated throughout the quarter. European polymer demand was firm in a balanced market, with solid volumes and high margins in the quarter.

Chemical Intermediates reported EBITDA of EUR248 million compared to EUR150 million in Q1, 2016.

As MRC informed earlier, INEOS Group Ltd. is considering expansion of its plants in USA to take advantage of low-cost natural-gas liquids as feedstock for ethylene production.

INEOS Group Limited is a privately owned multinational chemicals company consisting of 15 standalone business units, headquartered in Rolle, Switzerland and with its registered office in Lyndhurst, United Kingdom. It is the fourth largest chemicals company in the world measured by revenues (after BASF, Dow Chemical and LyondellBasell) and the largest privately owned company in the United Kingdom.
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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.
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