PP imports to Ukraine rose by 11% in Q1 2019

MOSCOW (MRC) -- Overall polypropylene (PP) imports to the Ukrainian market totalled 31,500 tonnes in the first three months of 2019, up by 11% year on year. The increase in imports occurred only for homopolymer PP, according to MRC DataScope.

March PP imports into Ukraine rose to 11,900 tonnes from 11,400 tonnes a month earlier, with propylene homopolymer (homopolymer PP) accounting for the main increase. Overall imports of propylene polymers reached 31,500 tonnes in January-March 2019, compared to 28,400 tonnes a year earlier. The volume of homopolymer PP imports increased, while the demand for propylene copolymers decreased.

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

March imports of homopolymers of propylene to the Ukrainian market grew to 9,700 tonnes from 9,100 tonnes a month earlier, local companies increased purchasing of homopolymer PP raffia in the Middle East. Overall shipments of homopolymer PP reached 24,500 tonnes in the first three months of 2019 versus 20,300 tonnes a year earlier.
Last month's imports of block propylene copolymers (PP block copolymers) were 800 tonnes, compared to 1,100 tonnes in February. 2,900 tonnes of PP block copolymers were imported over the stated period, whereas this figure was 3,300 tonnes a year earlier.

March imports of PP random copolymers were about 1,300 tonnes versus 1,100 tonnes a month earlier. Overall imports of PP random copolymers exceeded 3,500 tonnes in January-March 2018, whereas this figure was 4,300 tonnes a year earlier. Overall imports of other propylene copolymers were about 500 tonnes over the stated period.
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MOSCOW (MRC) -- Material supplier PolyOne Corp. failed to meet analyst estimates in its first quarter 2019 report, with revenue for the quarter coming in at USD900 million, flat with the prior year as growth from acquisitions of 3.5% was offset by a 1.5% reduction in organic sales and a 2% impact due to unfavorable foreign exchange, said Canplastics.

As a result, the Avon Lake, Ohio-based company has announced plans to cut an unspecified number of jobs. "Like many companies in our space, we experienced weaker demand in certain end markets and unfavorable foreign exchange during the first quarter – this resulted in a year-over-year decline in sales and earnings,” said Robert M. Patterson, chairman, president, and CEO of PolyOne. “Key drivers included lower automotive sales in Europe and China which impacted Color, Additives and Inks (Color) and Specialty Engineered Materials (SEM), and a decline in construction related sales, which primarily impacted Performance Products and Solutions (PPS) in North America."

On the plus side, PolyOne’s composite sales increased 10% organically driven by new business in consumer and electrical end markets. “Combined with strong performance from [our] January 2019 acquisition of Fiber-Line, composites-led growth added 17% to SEM operating income over the prior year first quarter,” Patterson said. “Fiber-Line had the best quarter in its history as a result of the continued build-out of 4G and emerging 5G network infrastructure."

"We believe the current market challenges are temporary, and we will see a recovery in the second half of the year,” Patterson added. “While we are encouraged and optimistic, we are not waiting for market improvement to unfold. Accordingly, we have taken actions to reduce costs primarily through targeted workforce reductions and limiting discretionary spending. We believe these actions are prudent in the short term, but also balanced, as we are not curtailing our ability to deliver for the long term. We are continuing to invest in key end markets and innovation, and as this quarter has demonstrated, our investments in composites and sustainable solutions are paying off."
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MOSCOW (MRC) -- Indian refiners are increasing their planned purchases from OPEC nations, Mexico and the United States to make up for any loss of Iranian oil if the US enforces sanctions more harshly from next month, reported Reuters with reference to sources and company officials.

All four Indian state-owned refiners that buy Iranian oil are confident of securing additional barrels from other producers, officials from the companies told Reuters.

The state refiners have not yet placed orders for Iranian oil for May, when the current waiver expires, pending clarity from the United States.

India’s Bharat Petroleum Corp (BPCL) and Mangalore Refinery and Petrochemicals Ltd (MRPL) have tapped Iraq to make up for Iranian oil, while Indian Oil Corp (IOC) has signed its first annual contract with US suppliers and raised supplies from Mexico.

"There will be no supply constraints. The supply can come from both OPEC and non-OPEC nations like the US," said M. K. Surana, chairman of Hindustan Petroleum Corp, which purchased up to 1.5 million tonnes per year of Iranian crude in 2018/19.

The Organization of the Petroleum Exporting Countries (OPEC) and other producers including Russia have gradually tightened supply through 2019 to reduce a global glut. OPEC and its partners may not renew the curbs when they expire after June because of the risk of over-tightening the market.

IOC, India’s top refiner and Iran’s biggest Indian client, will cut Iranian oil imports to 6 million tonnes, or about 120,000 barrels per day, in the 2019/20 period from 9 million in 2018/19, and has raised the optional volumes it can buy from other producers to 2 million tonnes, a company official said.

"Our optional quantities under term deals are higher than last year. We have optional contracts with Saudi Arabia, Kuwait and other suppliers... They will supply more if we want," the official said, adding his firm would also buy more US oil if required.

IOC also hopes to buy 1.5 million tonnes of Mexican oil in 2019, compared with 1 million tonnes last year, the source said.

Officials from state-owned National Iranian Oil Co did not immediately reply to requests for comment on the Indian refiners’ plans to purchase less Iranian crude.

Refinery officials said their 2019/20 crude import strategy was not contingent on Iranian oil, and was more flexible than in previous years.

"We don’t have a watertight plan for the year, we have optional quantities so that it is possible to find replacement if any country goes out for any reason," said an MRPL official.

During previous sanctions against Iran, Saudi Arabia and Iraq raised supplies to India to grow market share in the country, the world’s third-biggest oil consumer and importer.

Last year, MRPL signed its first annual deal with Iraq to buy 1.5 million tonnes of Basra oil in 2019.

BPCL has signed a deal to buy 5 million tonnes of Iraqi oil in 2019 compared with 1.5 million tonnes in 2018, its head of refineries R. Ramachandran said, adding his company is considering buying more oil from South America.

BPCL recently bought Brazilian crude and plans to buy Mexican oil as well, he said.

"We have a strategy with and without Iran," he added.
MRC

MOSCOW (MRC) -- The first-ever shipment of UAE-produced calcined coke has begun its maiden voyage to mainland China. 10,500 tons of calcined coke was loaded by ADNOC Refining, a subsidiary of the Abu Dhabi National Oil Company (ADNOC), onto the M/V Lucky Ocho, a vessel chartered by ADNOC Logistics & Services, to be delivered in Yantai, China by the end of April 2019, said Hydrocarbonprocessing.

The first shipment of this high-value product represents the latest milestone in ADNOC’s effort to reduce production of high-sulfur fuel oil (or ‘residue oil’) – and move towards being a ‘zero-fuel oil’ refining business. ADNOC made zero-fuel oil refining a high priority when the International Marine Organization’s (IMO) 2020 Regulation was first proposed – aimed at reducing the sulfur content contained in marine fuels from 3.5 percent to 0.5 percent – in an effort to limit the potential environmental impact of global shipping fleets.

IMO 2020 is expected to have a profound impact on the global refining and transport fuels industry. ADNOC commissioned, in September 2018, its multi-billion-dollar Carbon Black and Delayed Coker Unit. The Unit – which produced the UAE’s first-ever calcined coke, currently being shipped to China – allows ADNOC to extract the maximum value from sulfur-heavy ‘bottom-of-the-barrel’ oils and slurry, as it delivers on its Downstream strategy.

Jasem Al Sayegh, CEO of ADNOC Refining, said: “This milestone represents a significant step towards being a refining business capable of producing ‘zero-fuel oil’. ADNOC will continue to invest in an effort to broaden our product offering amidst evolving market conditions, ensuring we reduce our environmental footprint and maintain IMO-compliance leading up to 2020 and beyond."

Increasing the flexibility of ADNOC’s refining assets to stretch the value of every barrel of oil – and produce additional feedstocks and additives for the petrochemical industry – is a key pillar of ADNOC’s Downstream expansion strategy, which was announced at its Downstream Investment Forum last year.

The strategy will see ADNOC become a world-class producer, supplier and trader of refined and petrochemical products, as it focuses on growth markets in Asia, including China.

ADNOC’s multi-billion-dirham Downstream investment program will see the company’s refining capacity increase by more than 65 percent, or 600,000 barrels per day (bpd), by 2025, through the addition of a third refinery, creating a total capacity of 1.5 million barrels per day (mbpd). The new refinery will significantly increase the capability, flexibility and output of Abu Dhabi’s refining operations by adding to the range of crudes that can be processed.

ADNOC also plans to build one of the world’s largest mixed feed crackers, which will enable it to produce additional feedstocks and additives for the petrochemicals industry.
MRC

MOSCOW (MRC) -- Air Liquide Engineering & Construction (E&C) and Samsung Engineering have entered into a partnership to carry out the front-end engineering design (FEED) study of Sarawak Petchem's planned new methanol facility in Bintulu, Malaysia, according to Apic-online.

The plant is expected to produce 5,000 t/d of methanol based on Air Liquide E&C's proprietary Luri MegaMethanol technology. Operations are planned to begin in 2023.

The FEED contract will be exclusively converted to a licensor, engineering, procurement, construction and commissioning contract at the end of the year, subject to a final decision.

As MRC reported earlier, in April 2018, Air Liquide signed a new long-term agreement with LyondellBasell, one of the world’s largest plastics, chemicals and refining companies, to supply oxygen to LyondellBasell’s new large-scale petrochemical plant which will be constructed in Channelview, Texas. LyondellBasell’s new propylene oxide/tertiary butyl alcohol plant (PO/TBA), is expected to be the largest of its kind plant in the world when completed.
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