Iran will launch 42 petrochemical projects by the end of next year

MOSCOW (MRC) - Iran's petrochemical products will reach 100 million tons by the end of 2021, Oilcapital reports citing a message from the managing director of the investment department of the National Petrochemical Company of Iran Hossein Alimorad.

He noted that by this time the growth in production capacity of petrochemical companies will be 80%. "In Iran’s petrochemical industry, a significant leap will take place by 2021, and 42 petrochemical projects will be launched during this period," he stressed.

The volume of Iran’s petrochemical industry in 2013, Alimorad noted, was only about 56 million tons, and in 2017 - 64 million tons. The total cost of production in the petrochemical industry in 2013 amounted to USD16 billion, and in 2017 this figure reached USD17 billion.

According to Alimorad, by 2021, the volume of production in Iran in the petrochemical industry will reach USD25 billion.

Iran's petrochemical industry needs financing in the amount of USD23 billion, of which USD8 billion was provided, and the remaining USD15 billion will be provided through the capital market, Alimorad quoted.

Earlier it was reported that the volume of production of chemical and petrochemical products in Iran grew by 1.9% in ten months of the current 1398 Iranian year (from March 21 to January 20). Statistics showed that from March 8, 2019 to January 20, 2020, 45.8 million tons of petrochemical products were produced, which is 1.9% more compared to the same period last year. During this period, the production of polystyrene (PS) decreased by 60%, and the production of polycarbonate (PC) and epoxy - by 48.8 and 11.9%, respectively. Meanwhile, the production of rubber, styrene, butadiene, polypropylene (PP) and polyethylene (PE) showed an increase of 19, 9.5 and 8.7%.

Ethylene and propylene are the main raw materials for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to ScanPlast of MRC, in 2019 the estimated PE consumption in Russia amounted to 2,093.26 thousand tons, which is 6% more than the same indicator a year earlier. Deliveries of all types of polyethylene increased. PE supplies increased both from domestic manufacturers and from external suppliers. According to the results of 2019, the estimated PP consumption in the Russian market amounted to 1,260.4 thousand tons, which is 4% more than in 2018. The supply of almost all types of propylene polymers increased, except for the propylene random copolymers (PP-random).
MRC

MOSCOW (MRC) - Belarus in January 2020 reduced the export of phthalic anhydride by 18.4% compared to the same period in 2019, Lkmportal reports.

The country managed to avoid even greater reductions thanks to deliveries to Russia. According to the National Statistical Committee of the Republic of Belarus, the export of raw materials amounted to 2.547 thousand tons (-3.2% compared to 2019).

The decrease in the indicator was reflected, in particular, the lack of supplies to Ecuador, Chile, Turkey, Brazil, Nigeria, Algeria and Austria. A year earlier, these countries accounted for a total of 1 thousand tons of products. Also, Ukraine, one of the three buyers, reduced import by 67.7% in tonnage and 30.8% in monetary terms - to 63 tons in the amount of USD58 thousand, while the price decreased by 9.9% to USD921 per ton.

Russia remains the largest buyer of raw materials. In January, imports reached 1.63 thousand tons. Shipments rose 89.6% in tonnage.

The second position in the top three largest importers is Poland. The country purchased in Belarus 500 tons of phthalic anhydride in the amount of USD396.1 thousand with an average price of USD752 per tonne, which is 19% in tonnage, 3.4% in total exceeds the figure for 2019, while the price decreased by 13.1% .

Lithuania closes the top three, having purchased 252 tons of product in the amount of USD201.2 thousand with an average price of USD798 per ton. Relative to the level of 2019, exports to this country increased by 26% in tons and 21.8% in money, the price decreased by 3.3%.

It was previously reported that Belarus in January-October 2019 reduced the supply of phthalic anhydride by 20.8% compared to the same period in 2018.

Phthalic anhydride is widely used in the manufacture of paints and varnishes and plasticized PVC products. In a small amount it is used in the manufacture of rubber products, tires. In addition, it is used in the light, pharmaceutical and electrical industries.

According to the ICIS-MRC Price Report, in Russia the buying activity in the contract market has noticeably fallen this week, most of the processors have already closed all their deals on March deliveries of PVC. Consumers froze in anticipation of negotiations on April shipments.

MRC

MOSCOW (MRC) -- ACC’s US chemical production regional index (CPRI) declined by 0.2% in February, following a 0.1% gain in January and 0.2% dip in December, reported Chemweek.

Output declined in all regions of the country except the Gulf Coast, ACC says.

On a year-on-year (YOY) basis, the CPRI index was down by 1.8%, with declines in all regions. It was the ninth consecutive month with YOY declines.

Manufacturing activity was flat in February on a three-month moving average (3MMA) basis, according to ACC.

February’s CPRI generally does not reflect shutdowns and demand declines related to the COVID-19 outbreak in the US.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,093,260 tonnes in 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments rose from both domestic producers and foreign suppliers. The estimated PP consumption in the Russian market was 1,260,400 tonnes in January-December 2019, up by 4% year on year. Supply of almost all grades of propylene polymers increased, except for statistical copolymers of propylene (PP random copolymers).
MRC

MOSCOW (MRC) -- As infection rates continue to rise and European nations restrict movement in an attempt to limit the spread of the coronavirus pandemic, the European petrochemical industry is facing unprecedented challenges and uncertainty, reported S&P Global.

With borders across Europe closing, supply chain concerns are rising.

"The market is caught between a rock and a hard place, demand destruction as a result of the coronavirus pandemic and the OPEC price war which could see crude oil prices below USD20/b in the coming months. Supply chain and logistics constraints could result in producers having to cut rates regardless of margins. We are in unchartered territory but the risk for the next three to six months are still to the downside," Senior Manager Petrochemical Analytics at S&P Global Platts Rob Stier said.

The following are some of the latest developments in the European petrochemical industry: cracker operators are prioritizing balancing PE supply along the supply chain amid ample ethylene. Concerns grow over recycled polymer supply following reductions in waste collection across Europe.

Despite weak buying interest, Europe could see more methanol cargoes from Middle East as India starts 21-day lockdown.

Caustic soda market continues on an upward trend, as chlorine shortages cause increasingly tight market in Europe.
UK supply becomes more localized as buyers refrain from importing from Northwest Europe, according to sources.

PVC demand is expected to drop 25-30% in April due to the impact of the coronavirus on converter operations and downstream on construction projects, according to sources.

Demand for diethylene glycol in Poland remains robust despite the EU-wide lockdowns as the market looks to cover volumes.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,093,260 tonnes in 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments rose from both domestic producers and foreign suppliers. The estimated PP consumption in the Russian market was 1,260,400 tonnes in January-December 2019, up by 4% year on year. Supply of almost all grades of propylene polymers increased, except for statistical copolymers of propylene (PP random copolymers).
MRC

MOSCOW (MRC) -- Independent U.S. refiner HollyFrontier has removed contract workers from its refineries and all significant capital activity has stopped because of the coronavirus pandemic, Chief Executive Michael Jennings said , as per Hydrocarbonprocessing.

"As for plant operations, we have limited ourselves to only operations staff - only the hourly and management work force that actually runs the units - and core maintenance functions,” Jennings said during the Scotia Howard Weil Virtual Energy Conference. “So contractors are out of the plants and all significant capital activity has stopped."

Jennings also said gasoline demand at the company’s five U.S. refineries, located in mid-continent and Rocky Mountain states, had “cratered” in the push to halt the spread of coronavirus by social distancing.

"The diesel crack spread is pretty stalwart in at, probably, between USD15 and USD20 (a barrel), depending on the day,” he said. “But that’s a reflection that the supply chain still needs to function and toilet paper still needs to be delivered to keep those cities and their populations moving or at least functioning."

HollyFrontier’s share price was up 7.9% on Tuesday at USD20.13. Jet fuel demand has also dropped as people are staying in their homes, Jennings said. Out of a combined throughput of 514,630 barrels per day (bpd) the company only makes 6,000 bpd of jet fuel.

The company also expects a drop-off in the demand for lubricants following a surge in March as buyers stocked up their supplies, he said.

As MRC informed earlier, HollyFrontier Corp said it would build a biodiesel plant in New Mexico to lower costs related to blending renewable fuels and announced a USD1 billion share buyback program. Oil companies, including refiners, have to blend increasing amounts of renewable fuels with their petroleum products or purchase credits, known as Renewable Identification Numbers (RINs), to meet US biofuel requirements. The company’s RIN costs totaled USD184 million in 2018.

As MRC informed earlier, the U.S. Environmental Protection Agency will not appeal a court ruling that would sharply reduce its use of waivers exempting refineries from the nation’s biofuels regulation, a big win for the Corn Lobby, according to a Reuters case docket review.

As MRC informed earlier, US Senators Chuck Grassley and Joni Ernst of Iowa have asked the Trump administration not to appeal a court ruling that would slash the use of small refinery biofuel waivers, but have not heard back yet on its decision. President Donald Trump said the United States would take advantage of low oil prices and fill the nation’s emergency crude oil reserve, in a move aimed to help energy producers struggling from the price plunge.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 215,390 tonnes in the first month of 2020, up by 23% year on year. Shipments of all grades of high density polyethylene (HDPE) and linear low density polyethylene (LLDPE) increased due to higher capacity utilisation at ZapSibNeftekhim. At the same time, PP shipments to the Russian market were 127,240 tonnes in January 2020, up by 33% year on year. ZapSibNeftekhim's homopolymer PP accounted for the main increase in shipments.
MRC