Situation in the market of pipe HDPE in Russia stabilised in July

MOSCOW (Market Report) - Supply of polyethylene (PE) increased significantly this month in Russia after the shortage of natural high density polyethylene (HDPE) in June. But this factor did not help to avoid a significant rise in prices in the market, according to the ICIS-MRC Price Report.

A significant shortage of natural pipe HDPE in June was a surprise for Russian consumers, since the beginning of the year market was oversupplied. Taking this into account prices of pipe PE began to grow dynamically, and some Russian producers had to seriously adjust their production plans for July. The situation in pipe PE market has stabilised by mid-July, but a serious rise in price of raw materials still could not be avoided.

A key supplier of natural pipe HDPE in the Russian market - Gazprom neftekhim Salavat (GnS) - shut its capacity for a turnaround in early July, but the shutdown was not long. The offer of Salavat polyethylene has grown significantly by the middle of July, Customers of the plant said only pipe PE from GnS will be produced until September.

Stavrolen also increased production of pipe PE in the beginning of the month, although some of the volumes were supplied to export markets. Partly the need for raw materials producers of pipes satisfied with natural HDPE grade 273-83; Russian pipe producers sold the July quotas of this PE in the first decade of the month.

The rush in the market of natural pipe HDPE has subsided by mid-July. The supply of material has grown significantly, although there is still no excess. And, most likely, this status quo will continue in August.

Prices for natural pipe HDPE began rising in mid-June from the level of Rb94,000/tonne CPT Moscow, including VAT, and by the end of the month in some cases it reached Rb100,000/tonne CPT Moscow, including VAT. Some suppliers slightly increased PE prices for their customers in July further, but on average the prices were settled slightly above Rb100,000/tonne CPT Moscow, including VAT.
MRC

MOSCOW (MRC) -- Overall imports of polypropylene (PP) to Belarus grew in the first five months of 2018 by 8% year on year, totalling slightly over 41,100 tonnes. Demand for all grades of propylene polymers increased, according to MRC's DataScope report.

May PP imports into Belarus were about 9,000 tonnes, compared to 9,200 tonnes a month earlier, local companies reduced their purchasing of propylene copolymers. Overall imports of propylene polymers reached 41,100 tonnes in January-May 2018, compared to 38,000 tonnes a year earlier. The need in all grades of propylene polymers increased, with propylene copolymers accounting for the greatest increase in demand.

The supply structure by PP grades looked the following way over the stated period.

May 2018 imports of propylene homopolymers (homopolymer PP) to the Belarusian market exceeded 6,000 tonnes versus 5,700 tonnes a month earlier, local companies increased their purchasing of injection moulding PP in Russia. Thus, overall homopolymer PP imports reached 27,500 tonnes in the first five months of 2018, up by 7.2% year on year. Russian producers with the share of about 89% of the total shipments were the key suppliers.

June imports of propylene copolymers to Belarus were 2,900 tonnes, compared to 3,500 tonnes a month earlier, local companies reduced their procurement of injection moulding statistical copolymers (PP random copolymers) in Russia and the Middle East. Thus, overall imports of propylene copolymers reached 13,600 tonnes in January-May 2018, whereas this figure was 12,400 tonnes a year earlier.

MRC

MOSCOW (MRC) - U.S. refiners ran full-tilt in the second quarter, fueled by cheap domestic crude and fat margins that should boost earnings, though their heavy activity could eventually saturate the market with gasoline, sapping profits down the road, as per Hydrocarbonprocesing.

U.S. independent refiners, including Phillips 66 and Marathon Petroleum Corp, are expected to announce strong results due to the heavy discounts for U.S. and Canadian crude, along with strong fuel demand and lower costs to comply with the nation's biofuel laws, analysts said.

Strong crack spreads - the margin on turning crude oil into diesel, gasoline and other products - have spurred refiners to keep production high. That margin <CL321-1=R> averaged about $21.07 per barrel in the second quarter, its highest since 2015.

Among the largest independent refiners, Marathon, CVR Energy, and Hollyfrontier Corp rank in the top 10 percent in Thomson Reuters analyst revisions models, which weighs recent changes in estimates for revenue and per-share earnings, suggesting positive trends headed into reporting season for refiners, which begins next week.

The discount on crude prices in Midland, Texas widened by nearly $10 a barrel against benchmark futures <WTC-WTM> during the second quarter, as production in the Permian surged beyond pipeline capacity to move oil out of the region.

Increased export demand also led to high utilization rates, a positive, said Sandeep Sayal, vice president in the refining and marketing group at IHS Markit. The United States exported about 5.1 million barrels per day (bpd) of products through the second quarter, according to data from the U.S. Energy Information Administration.

Refinery utilization rates hit their highest levels since 2005 in June as they processed record amounts of crude oil in June, according to the EIA.
MRC

MOSCOW (MRC) -- Messer, the largest privately run industrial gases specialist, has signed a 15-year hydrogen supply contract with RUTGERS Germany, a subsidiary of Rain Carbon Inc, as per Hydrocarbonprocessing.

The industrial gases company will now invest a total of nine million euros in a hydrogen production facility at the site of Rain Carbon Inc. in Castrop Rauxel. The company will use the hydrogen in the hydrogenation of industrial resins.

Hydrogen is produced in plants like this of Messer in Hungary. The gas is used in the annealing of high-alloy steels and sintered parts as well as in hydrogenation processes in the chemical and food industries, for example.
Hydrogen is produced in plants like this of Messer in Hungary. The gas is used in the annealing of high-alloy steels and sintered parts as well as in hydrogenation processes in the chemical and food industries, for example.
Messer will also use the facility to supply other hydrogen customers in the region. The facility will produce hydrogen by means of the steam reforming process, using natural gas as the feedstock. It will have a capacity of 2,700 normal cubic meters per hour. That is the equivalent of approximately 15 tankers per day. Start-up of the hydrogen plant – Messer’s first in Germany – is planned for the third quarter 2019.
MRC

MOSCOW (MRC)--Praxair, Inc. has renewed and expanded a long-term contract to supply hydrogen to Marathon Petroleum Corporation’s Galveston Bay Refinery in Texas City, Texas, as per Hydrocarbonprocessing.

Marathon Petroleum is the second largest transportation fuels refiner in the U.S. and operates an integrated refining, marketing and transportation system in the Midwest, East, Southeast and Gulf Coast.

This world-class 571,000-barrel-per-day refining complex is the second largest in the U.S. and requires reliable hydrogen supply to support production of clean fuels. Praxair has been supplying industrial gases to the Galveston Bay Refinery since 1985.

"We are proud to renew our contract with Marathon Petroleum,” said Dan Yankowski, president of Praxair’s global hydrogen business. “We look forward to supporting their ongoing operations and future growth, as Praxair continues to provide industry-leading reliability through our Gulf Coast hydrogen system."

Praxair operates over 50 hydrogen production facilities and six hydrogen pipeline systems worldwide. Refinery and chemical customers benefit from Praxair’s comprehensive portfolio of large-volume industrial gases, cylinder gases and specialized technologies, services and supply reliability.
MRC