US polyethylene exports surge 44% in 2019

MOSCOW (MRC) -- US polyethylene (PE) exports rose 11% in December to 858,634 metric tons, a new monthly high, reported Chemweek with reference to US Commerce Department data released yesterday.

PE exports from the US totaled 9.33 million metric tons (MMt) for the whole of 2019, up 2.84 MMt, 44%, over 2018.

The export boom is a result of the dramatic expansion of North American PE capacity in recent years and the abundance of low-cost feedstock that has made PE exports competitive in the global market.

US PE export volumes to China fell by 9% to 584,157 metric tons last year, bucking the overall trend because of the trade war. However, US suppliers adjusted by selling more into markets in Southeast Asia. Of the four fastest-growing PE export destinations in 2019, three were in Southeast Asia: Singapore, Malaysia and Vietnam, which collectively took in 845,888 metric tons more PE in 2019 compared to the previous year.

Belgium was the second-fastest-growing PE export market for the US by volume, accounting for about 10% of additional exports in 2019. Brazil was the fifth-fastest-growing destination.

US PE export volumes will likely need to continue growing in 2020, with three new PE plants with a total of 1.32 MMt of production capacity scheduled to come online over the next few months and limited growth prospects for the domestic market. Domestic demand weakened in 2019, according to preliminary data published in January by the American Chemistry Council. Domestic sales by US and Canadian producers in 2019 totaled 31.6 billion pounds, or 14.3 MMt, down from 32.7 billion pounds, 14.8 MMt, in 2018.

We remind that, as MRC wrote before, in early November 2019, LyondellBasell began the commissioning works of its new high density polyethylene (HDPE) plant in La Porte, Texas, USA. The brand new plant will utilize LyondellBasell’s patented Hyperzone technology to produce 500,000 tons/year of HDPE. Sales volumes from the plant are expected to increase during the first quarter of 2020.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,904,410 tonnes in the first eleven months of 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments increased from both domestic producers and foreign suppliers.
MRC

MOSCOW (MRC) -- State-run Bharat Petroleum Corp will import 1 million barrels of Iranian oil in February after a gap of three months, with the nation’s overall purchases from Tehran remaining at 9 million barrels, reported Reuters with reference to three industry sources' statement.

The United States in early November granted India a six-month waiver from sanctions on Iran’s oil exports.

Under the agreement, New Delhi must restrict its Iranian oil purchases to 1.25 million tonnes, or 9 million barrels.

BPCL and Hindustan Petroleum Corp will lift 1 million barrels each of Iranian crude oil in February, the sources said. HPCL this month resumed purchases of Iranian oil after a gap of six months. The company halted Iranian oil purchases in July after its insurance company refused to provide cover for the crude because of US sanctions, although its chairman said HPCL may resume buying Iranian oil under sanctions waivers.

Indian Oil Corp, the country’s top refiner, will lift 5 million barrels of Iranian oil in February, the same as this month. Mangalore Petrochemicals Ltd will buy 2 million barrels compared with 3 million barrels this month, the sources said.

An IOC official had previously said his firm would lift 180,000 bpd - the full volume contracted under an annual deal with Iran for this fiscal year ending March 31, 2019.

India recently exempted rupee payments to the National Iranian Oil Co (NIOC) for crude oil imports from a steep withholding tax, paving way for pending dues to be cleared.

HPCL, IOC and BPCL did not immediately respond to requests for comment, while MRPL declined comment.

As MRC informed previously, BPCL plans to set up a petrochemicals unit at its Bina refinery in Madhya Pradesh as part of its Rs25,000 crore expansion plan for the refinery. The petrochemical unit, which will include a 1.5 mln tpa naphtha cracker, is expected to cost Rs6,000-7,000 crore.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,904,410 tonnes in the first eleven months of 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments increased from both domestic producers and foreign suppliers. The PP consumption in the Russian market was 1,161,830 tonnes in January-November 2019, up by 7% year on year. Deliveries of all grades of propylene polymers increased, with the homopolymer PP segment accounting for the largest increase.

Bharat Petroleum Corporation Limited (BPCL) is an Indian state-controlled oil and gas company headquartered in Mumbai, India. Bharat Petroleum owns refineries at Mumbai, Maharashtra and Kochi, Kerala (Kochi Refineries) with a capacity of 12 and 9.5 million metric tonnes per year.
MRC

MOSCOW (MRC) -- PKN Orlen has informed that on 5 February 2020, as a part of investment project called: "Visbreaking Installation at production plant in Plock", it signed an agreement with consortium of companies: KTI Poland S.A. and IDS-BUD S.A. for design, deliveries and building "in turn key" formula of the Visbreaking Basic Installation for a total amount of ca. PLN 750 m, as per the company's press release.

The project's implementation aims to improve crude oil production efficiency by increasing the yield of high-margin products as a result of in-depth conversion of vacuum residue from the Crude Distillation Unit.

The cost of investment will amount to ca. PLN 1 bn.

The finalization of the investment is planned by the end of 2022.

After realization of the project it is estimated that the operating profit EBITDA of PKN Orlen may increase in the range of PLN 340 to 415 m yearly.

As MRC informed before, in September 2019, Honeywell announced that PKN ORLEN had licensed the UOP MaxEne process, which can increase production of ethylene and aromatics and improve the flexibility of gasoline production. The project, for the PKN Orlen facility in Plock, Poland, was in the basic engineering stage then.

Ethylene is the main feedstock for the production of polyethylene (PE).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,904,410 tonnes in the first eleven months of 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments increased from both domestic producers and foreign suppliers.
MRC

MOSCOW (MRC) -- Trinseo, a global material solutions provider and manufacturer of plastics, latex binders, and synthetic rubber, plans to build a Thermoplastic Elastomers (TPE) pilot facility at the company's existing manufacturing site in Hsinchu, Taiwan, which will begin operations in 2020, as per the company's press release.

The investment in a state-of-the art TPE pilot facility in Asia Pacific is the next step of Trinseo’s TPE growth roadmap following the acquisition of Italian-based API S.p.A, in July 2017. Once the new pilot line in Hsinchu is operational, Trinseo will locally produce its custom engineered TPE and thermoplastic urethanes (TPU), including its leading bioplastics portfolio.

"The pilot facility demonstrates our commitment to offer a differentiated, globally available TPE portfolio to our customers in the automotive, consumer electronics, footwear and medical markets," said Tim Stedman, Senior Vice President, Strategy and Corporate Development at Trinseo. "This investment in growth in the Asia Pacific region will further strengthen our ability to create growth synergies with customers between our rigid and soft-touch polymers."

As MRC informed before, Trinseo have announced a price increase for all polystyrene (PS) grades, acrylonitrile-butadiene-styrene (ABS) and acrylonitrile styrene copolymer (SAN) grades in Europe. Effective February 1, 2020, or as existing contract terms allow, the contract and spot prices for the products listed below rose as follows:

-- STYRON general purpose polystyrene grades (GPPS) -- by EUR100 per metric ton;
-- STYRON and STYRON A-Tech and STYRON X- Tech high impact polystyrene grades (HIPS) - by EUR100 per metric ton;
- MAGNUM ABS resins - by EUR55 per metric ton;
- TYRIL SAN resins - by EUR55 per metric ton.

According to ICIS-MRC Price report, significant changes are not expected in the Russian PS market this month. Nizhnekamskneftekhim rolled over January prices of material for shipments in February. Penoplex also maintained its GPPS prices the same, whereas Gazprom neftekhim Salavat will finally set February prices this week, but no major changes are expected.

Trinseo is a global materials company and manufacturer of plastics, latex and rubber. Trinseo's technology is used by customers in industries such as home appliances, automotive, building & construction, carpet, consumer electronics, consumer goods, electrical & lighting, medical, packaging, paper & paperboard, rubber goods and tires. Formerly known as Styron, Trinseo completed its renaming process in 1Q 2015. Trinseo had approximately USD4.6 billion in net sales in 2018, with 16 manufacturing sites around the world, and approximately 2,500 employees.
MRC

MOSCOW (MRC) -- Negotiations on prices of European polyvinyl chloride (PVC) for February shipments to the CIS markets have begun this week. Prices of raw materials in Europe remained steady, however, European producers have announced an increase in PVC export prices, according to the ICIS-MRC Price Report.

February contract price of ethylene was agreed at the level of January , which theoretically suggests the unchanged cost of production of polyvinyl chloride. Nevertheless, a balanced domestic market and good demand from key export markets allow European producers to play to increase PVC export prices.

Export prices of PVC for CIS countries are discussed at an increase of EUR20-30/tonne against the price of January.
Also, by increasing of the price of polyvinyl chloride, European producers are trying to compensate for the decrease in margins in caustic soda, which has been seen in the last few months.

The demand for PVC is not strong in the CIS countries in February due to a number of reasons, and basically reduced to the procurement of PVC K 58 and K 70.

European producers have no serious restrictions on export volumes, but most sellers try to sell PVC for export at the highest possible prices. Several producers intend to achieve an increase in export prices by EUR40/tonne compared to January, but some consumers report that they managed to limit the price increase to EUR20-30/tonne.

But in general, deals for February shipments of suspension PVC (SPVC) to the CIS markets were held in the range of EUR725-795/tonne FCA.
MRC