HDPE production in Russia up by 4.6% in Jan-Oct 2018

MOSCOW (MRC) -- Russia's production of high density polyethylene (HDPE) totalled 795,900 tonnes in January-October 2018, up by 4.6% year on year. At the same time, only two out of four Russian producers increased their output, according to MRC's ScanPlast report.

October HDPE production in Russia decreased to 64,200 tonnes, whereas this figure was 79,200 tonnes a month earlier. Shutdown for a scheduled maintenance at Russia's two largest producers - Kazanorgsintez and Stavrolen - was the main reason. Overall HDPE production reached 795,900 tonnes in the first ten months of 2018, compared to 760,600 tonnes a year earlier. Gazprom neftekhim Salavat and Stavrolen increased their output, whereas Nizhnekamskneftekhim reduced its production by more than a third in favour of linear low density polyethylene (LLDPE).

The structure of polyethylene (PE) production by plants looked the following way over the stated period.

Kazanorgsintez's total HDPE output fell to 16,800 tonnes in October from 38,200 tonnes a month earlier, the Kazan producer shut down its production capacities for almost a one-month scheduled turnaround on 25 September. The Kazan plant's overall HDPE output totalled 412,400 tonnes in January-October 2018, down by 0.3% year on year.

Stavrolen produced 18,600 tonnes last month versus 25,000 tonnes in September, the Budenovsk producer took off-stream its production capacities for maintenance in the first decade of October. The plant's overall HDPE output reached 241,100 tonnes in the first ten months of 2018, up by 17% year on year. Such a high amount of the increase in the output was caused by the absence of a long scheduled maintenance this year.

Gazprom neftekhim Salavat raised its capacity utilisation in October, the plant produced 11,500 tonnes last month, compared to 9,500 tonnes a month earlier. The Bashkir plant's total HDPE output reached 100,900 tonnes in the first ten month of 2018, up by 33% year on year. Such a high amount of the increase in the output was caused by the absence of a long scheduled turnaround this year, as it was the case with Stavrolen.

Nizhnekamskneftekhim produced HDPE only in April-May and in late September-October during the stated period. Thus, the Nizhnekamsk producer manufactured only 41,600 tonnes of HDPE over the incomplete four months of operations versus 64,700 tonnes a year earlier.

MRC

MOSCOW (MRC) -- Wison Engineering Services Co. Ltd. has completed delivery of all nine ethylene-cracking furnaces to be installed as part of the naphtha cracking unit at the first phase of Zhejiang Petrochemical Co. Ltd.’s (ZPC) 800,000-b/d integrated refining and petrochemical complex currently under construction in Zhoushan, Zhejiang Province, China, as per OGJ.

Wison Engineering - which was responsible for modularized design, construction, and installation of the project - along with affiliate Wison Offshore & Marine delivered the ninth modular ethylene-cracking furnace to the site at the end of October following delivery of the other eight similar furnace modules earlier in the year, the service provider said.

The core equipment of the naphtha cracking unit - which is composed of nine ethylene-cracking furnaces with an output of 200,000 tonnes/year each and will have the largest single-chain ethylene production capacity in China upon startup - is now fully in place, Wison Engineering said.

With a total weight of about 33,000 tonnes, the nine ethylene-cracking furnace modules for Phase 1 of the complex will be able to produce 1.4 million tpy of ethylene.

The first 400,000-b/d phase of ZPC’s complex is due for startup by December, while Phase 2 - which will nearly double processing and production capabilities at the site - is scheduled for commissioning during first-quarter 2021.

As MRC reported earlier, Saudi Aramco also recently signed a memorandum of understanding with ZPC to acquire ownership interest in the complex.

ZPC - a joint venture of China-based Rongsheng Holding Group Co. Ltd., Juhua Group Corp., Tongkun Group Co. Ltd., and Zhoushan Marine Comprehensive Development Investment Co. Ltd. - previously said it would invest about 160 billion yuan to complete both phases of the project.
MRC

MOSCOW (Market Report) - Prices of polypropylene (PP) continued to rise in November in the Russian market, in particular, homopolymer PP. PP problems at two production sites significantly limited supply in the market, and, as a result, led to further price rise, according to the ICIS-MRC Price Report.

Restrictions on homopolymer PP supply to the domestic market from some producers began in August, and were due to a series of scheduled maintenances at several producers at once in September-October. Many consumers expected that with the end of production repairs, PP supply will increase in the market, and as a result, amid falling demand, will lead to price cuts. But the shutdowns dragged on, and the lack of supply only increased.

SIBUR Tobolsk and Ufaorgsintez, due to certain reasons, were rather difficult and late to come out from preventive repairs. And even after the start-up, these plants had to work with a limited load due to raw materials problems. It is highly probable that the restrictions will continue until the end of November.

Russian producers reduced exports almost two times in September-October on order to balance the domestic market.
Exports are expected to decrease further in November due to the deteriorating market situation. Partly the shortage of Russian homopolymer PP were compensated by imports from Central Asian countries, but these producers also had planned and unplanned production shutdowns in October-November.

The most critical at the current moment is the situation in the segment of injection moulding homopolymer PP. Many companies reported a more serious shortage of supply than in homopolymer PP segment. Prices fro raffia last week grew to Rb105,000-107,000/tonne FCA, including VAT. The low end for injection moulding homopolymer PP was at Rb107,000/tonne FCA, including VAT.
MRC

MOSCOW (MRC) - Production of unmixed polyvinyl chloride (PVC) in Russia increased to about 784,900 tonnes in the ten months of this year, up 7% compared to the same period of 2017. All producers increased production volumes over the reported period, according to MRC ScanPlast.

October production of unmixed PVC in Russia rose to 85,000 tonnes from 77,400 tonnes a month earlier, three producers increased capacity utilisation. Overall PVC production reached 784,900 tonnes in January-October 2018, compared to 735,400 tonnes a year earlier. All plants raised their production, with Bashkir Soda Company accounting for the greatest increase in the output.

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

RusVinyl (JV of SIBUR and SolVin) produced about 32,200 tonnes of PVC in October, with emulsion polyvinyl chloride (EPVC) accounting for 2,700 tonnes, compared to 29,800 tonnes a month earlier. RusVinyl's overall output of resin reached 275,500 tonnes in the first ten months of 2018, up 8% year on year.

SayanskKhimPlast increased capacity utilisation last month, the plant's SPVC production reached 27,600 tonnes, whereas this figure was only 24,000 tonnes in September. The Sayansk plant managed to produce about 224,800 tonnes of resin in the first ten months of 2018, compared to 212,500 tonnes a year earlier.

Bashkir soda company (BSC) in the second half of September - early October, due to technical problems, reduced capacity utilisation, so the total PVC production amounted to 17,300 tonnes against 16,400 tonnes a month earlier. The Bashkir plant's overall production of PVC reached 207,300 tonnes in January-October 2018, up by 5% year on year. Such a great increase in the output was largely caused by the absence of a scheduled shutdown this year, whereas last year, the plant took off-stream its production capacities in mid-July.

Kaustik (Volgograd) in October increased SPVC production, reaching about 7,800 tonnes, compared with 7,200 tonnes in September. The plant's overall production of resin reached 77,300 tonnes over the stated period versus 71,200 tonnes a year earlier.


MRC

MOSCOW (MRC) -- LG Chem Ltd., South Korea's top chemicals firm, said Friday that it has named a top executive of U.S. industrial giant 3M Co. as its new vice chairman and CEO, reported KoreaTimes.

LG Chem said Shin Hak-cheol, a vice chair and executive vice president of 3M, is the "the right person" to respond to rapidly changing business environments while leading a change in corporate culture and structure, citing his global perspective and experience in operating a global materials and components business.

Shin climbed the corporate ladder to a top post after joining 3M Korea as a technical service supervisor in 1984, becoming the first South Korean senior executive to lead 3M's overseas business.

"Based on his accumulated experience in a world-renowned company, we expect LG Chem to take a further step forward in becoming a global innovative company," LG Chem said in a statement.

It marked the first time that LG Chem has nominated a CEO from outside of the company since its foundation in 1947.

Shin is set to replace LG Chem Vice Chairman and CEO Park Jin-soo in March next year if approved by the company's board.

LG Chem makes a wide variety of products, ranging from petrochemical goods to plastics, rechargeable batteries, electronic materials and drugs and vaccines.

Currently, LG Chem is a key supplier of electric vehicle batteries to US auto giant General Motors Co., Volvo and Renault, as well as South Korea's largest carmaker Hyundai Motor Co. and its smaller affiliate Kia Motors Corp. (Yonhap).

As MRC informed earlier, in January 2016, LG Chem said it had decided to drop a plan to jointly build a USD4.2-billion petrochemical complex in Kazakhstan, citing a prolonged slump in oil prices and a sharp increase in facility investments. In 2011, the chemical company said it would construct the complex near the western Kazakh city of Atyrau as part of a 50-50 joint venture with two Kazakh companies. The plan involved building ethylene and polyethylene plants with annual capacities of 840,000 tonnes and 800,000 tonnes, respectively. The project was announced in 2013.

LG Chem Ltd., often referred to as LG Chemical, is the largest Korean chemical company and is headquartered in Seoul, South Korea. According to ICIS report, it is 15th biggest chemical company in the world in 2011. It has eight domestic factories and global network of 29 business locations in 15 countries. LG Chem is a manufacturer, supplier, and exporter of petrochemical goods, IT&E Materials and Energy Solutions.
MRC