PP imports to Ukraine rose by 10% in H1 2019

MOSCOW (MRC) -- Ukraine's polypropylene (PP) imports totalled about 66,800 tonnes in the first six months of the year, up 10% year on year. The greatest increase in imports accounted for homopolymer PP, according to MRC DataScope.

June PP imports into the country fell to 10,200 tonnes from 11,500 tonnes a month earlier, the main decrease in imports were seen in the shipments of PP random copolymers. Overall imports of propylene polymers reached 66,800 tonnes in January-June 2019, compared to 60,800 tonnes a year earlier. Homopolymer PP accounted for the main growth in imports, whereas demand for propylene copolymers subsided.

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

June imports of homopolymer PP practically remained steady, compared with the May figures - 8,100 tonnes. Overall shipments of homopolymer PP reached 52,200 tonnes in the first six months of 2019 versus 44,500 tonnes a year earlier.

Last month's imports of block propylene copolymers (PP block copolymers) were 1,000 tonnes, compared to 1,100 tonnes in May. Imports of PP block copolymers into the country were about 6,400 tonnes in January-June, compared with about 6,500 tonnes year on year.

June imports of statistical copolymers of propylene (PP random copolymer) were about 1,000 tonnes from 2,200 tonnes a month earlier, local companies significantly reduced their purchasing of pipe PP random copolymer. Overall imports of PP random copolymers exceeded 7,300 tonnes in January-June 2019, whereas this figure was about 8,700 tonnes a year earlier.

Overall imports of other propylene copolymers were about 867 tonnes over the stated period.


MRC

Bashkir Soda Company shut PVC production

MOSCOW (Market Report) -- Bashkir Soda Company shut down its polyvinyl chloride (PVC) production for a scheduled turnaround last weekend, according to the ICIS-MRC's Price report.

The plant's representative said Bashkir Soda Company had taken off-stream its PVC production capacities for the scheduled maintenance by 15 July, 2019. The outage will be short and will last for two weeks. The plant's annual production capacity is 240,000 tonnes.

It is also worth noting that this is the second shutdown for maintenance at Russian PVC plants in July. SayanskKhimPlast shut its production, which annual capacity is 350,000 tonnes, for a 30-day turnaround last week.

As reported earlier, Bashkir Soda Company (part of "Bashkir Chemistry" group) received Rb11.5 billion of net profit under RAS in 2018, up by 6.6% year on year. The company's revenue increased by 11.9% to Rb44.5 billion, product cost - by 11.5% to Rb27.3 billion.

Bashkir Soda Company is Russia's largest producer of soda ash and baking soda and a major polyvinyl chloride (PVC) producer. It also ships production to glass industry enterprises. The main shareholders of the company are "Bashkir Chemistry" (57.18%) and the state investment company of Bashkiria "Regional Fund" (38.28%).
MRC

PVC imports to Ukraine fell by 46% in H1 2019, exports down by 6%

MOSCOW (MRC) -- Imports of suspension polyvinyl chloride (SPVC) into Ukraine decreased by 46% in the first half of 2019 year on year to about 21,000 tonnes. At the same time, sales of Ukrainian PVC to foreign markets dropped by 6% year on year, according to a MRC's DataScope report.

Last month's SPVC imports to the Ukrainian market fell to 2,600 tonnes from 2,900 tonnes in May, local companies significantly reduced their purchasing in foreign markets in the past two months amid high prices and sufficient supply from the domestic producer. Overall SPVC imports reached 21,000 tonnes in January-June 2019, compared to 38,800 tonnes a year earlier.

European producers with the share of about 69% of the total imports were the key suppliers of resin to the Ukrainian market in the first half of 2019. USA producers with the share of about 31% were the second largest suppliers.
Stronger demand for Ukrainian PVC from the domestic market led to lower imports. 13,400 tonnes of suspension were shipped to foreign markets in June, whereas this figure was 16,400 tonnes a year earlier. Overall, over 80,000 tonnes of PVC were shipped for export in January-June 2019 versus 84,700 tonnes a year earlier.

MRC

Refiners test the waters with exports of IMO 2020-compliant fuel

MOSCOW (MRC) -- Refineries in Taiwan and South Korea are testing the market for fuels that meet new rules for low-sulfur ship fuel starting next year, exporting some cargoes of very low-sulfur fuel oil (VLSFO) this month, said Hydrocarbonprocessing.

Oil market participants are uncertain what kind of fuel product shipping companies will use to meet the International Maritime Organization's (IMO) 0.5% sulphur standard for ship fuels starting in 2020. The VLSFO shipments demonstrate that this type of fuel is a viable option that refineries could readily market.

The refiners in Taiwan and South Korea have redirected low-sulfur feedstocks, that would normally undergo further refining into gasoline, toward making the VLSFO, with 0.5% or less sulfur content, as a result of recent low profits for gasoline and to test their ability to produce the fuel.

One refining official based in Seoul said their plant primarily runs high-sulfur crude oil so they take the fuel oil produced after initial refining and remove the sulfur through a residue desulphurization process. Instead of passing the feedstock through a residue fluid catalytic cracker (RFCC) to make gasoline, they are selling it as VLSFO.

He declined to be named as he is not authorized to speak to the media. This would "reduce gasoline output while increasing LSFO output so the gasoline market could recover," the official said.

Taiwan's Formosa Petrochemical, South Korea's GS Caltex, S-Oil Corp and Hyundai Oilbank Corp have sold VLSFO cargoes since June, Reuters has reported. More VLSFO supply could offset demand for marine gasoil (MGO), a more expensive alternative that is being considered by shippers.

Consultancy Energy Aspects said in a report that the "growing VLSFO production provides a threat to diesel demand in 2020 and provides a floor to Asian gasoline markets as more FCCs trim runs to free up VGO to be blended into VLSFO."

Formosa has sold two July cargoes, their first exports of VLSFO in at least a decade, in a pre-marketing effort, company spokesman K.Y. Lin said.

"We'll see how big the market can be," he said, adding that the company also plans to supply VLSFO to tankers calling at its refinery in Mailiao, Taiwan.

GS Caltex sold three VLSFO cargoes for July to September delivery and the company's spokesman said it plans to increase supplies by replacing fuel oil used at their refineries for power generation with liquefied natural gas (LNG).

However, gasoline margins have rebounded this month, reducing the incentive for refiners to switch production.
MRC

Iran set to invest in south Indian refinery

MOSCOW (MRC) -- Iran is ready to invest in the expansion of a South Indian refinery, an Iranian official said in New Delhi, as the country seeks new avenues of growth amid debilitating U.S. sanctions, said Reuters.

Iran has seen a massive drop in export earnings which is eating into funds for social development. This has raised questions that it might not invest in the expansion of a refinery in South India where it already holds a minority stake.

Iran’s participation has also been questioned after India cut back its Iranian crude oil imports following U.S. sanctions and stopped them completely from May.

“We have announced our readiness for that (to invest in the refinery),” said Ali Chegeni, ambassador of Iran in India. “We have no limit to work with India whether an investment, whether any kind of joint venture, we are ready for that.”

India was Iran’s top oil client after China, but halted imports after Washington withdrew exemptions in May to eight nations, including India, who were earlier allowed to import some Iranian oil. Naftiran Intertrade, the Swiss subsidiary of National Iranian Oil Company, holds a 15.4% stake in Chennai Petroleum Corporation Ltd, a subsidiary of India’s biggest state-owned refiner Indian Oil Corp Ltd.

Indian Oil has about 52 percent share in the refinery. Chennai Petroleum plans to invest up to 356.98 billion rupees (USD5.1 billion) to replace the 20,000 bpd Nagapattinam refinery in Southern Tamil Nadu state with a 180,000 bpd plant.

Chegeni said he hoped that Bank Pasargad, a major Iranian bank which offers commercial and retail services, will soon open a branch in India and will directory deal with India’s UCO Bank and IDBI Bank Ltd that were handling India’s oil payments in rupees to Tehran.

India was paying for oil imports in rupees before suspending its purchases.
MRC