RusVinyl resumes PVC production

MOSCOW (MRC) -- RusVinyl, joint venture of SIBUR and Solvay, has resumed its polyvinyl chloride (PVC) production after a scheduled turnaround, according to ICIS-MRC Price report.

The plant's customers said RusVinyl had brought on-stream its production capacities by 28 July, as scheduled, after maintenance works. The outage was short and lasted for about two weeks.

As reported earlier, SayanskKhimPlast shut its PVC production for a 30-day turnaround on 8 July, whereas Kaustik Volgograd idled its production capacities in May-June. Bashkir Soda Company does not plan to shut its production for maintenance works this year.

RusVinyl was put into operation in the second half of 2014. The plant's design capacity is 300,000 tonnes/year of suspension polyvinyl chloride (SPVC) and 30,000 tonnes/year of emulsion polyvinyl chloride (EPVC). Its caustic soda production capacity is 225,000 tonnes/year.
MRC

MOSCOW (MRC) -- Imports of unmixed polyvinyl chloride (PVC) into Kazakhstan rose in the first five months of 2020 by a quarter year on year to 24,000 tonnes, reported MRC analysts.
Demand for PVC increased from local companies in May under the pressure of seasonal factors, and May imports of unmixed PVC were 5,400 tonnes versus 4,200 tonnes a month earlier. Thus, overall imports of resin reached 24,000 tonnes in January-May 2020, compared to 19,300 tonnes a year earlier. It is also worth adding that such a significant increase in this year's imports was caused by a further resale of resin to Russia.
Due to the geographical position, Chinese producers with the share of about 94% of the local market over the stated period were the main PVC suppliers to Kazakhstan. Russia was the second largest PVC supplier, shipments of Russian resin reached 3,900 tonnes over the stated period.

MRC

MOSCOW (MRC) -- Engineering and construction costs in North America fell in May, with lower prices expected to continue into the fourth quarter of 2020, according to IHS Markit and the Procurement Executives Group (PEG), said Chemweek.

The current headline IHS Markit PEG Engineering and Construction Cost Index (ECCI) registered 38.2 in May, a slight increase compared with last month’s figure of 34.9, but still “well below” the neutral mark of 50, which indicates falling prices, IHS Markit says. The materials and equipment portion of the index came in at 35.0, with the subcontractor portion at 45.7.

The ECCI tracks construction costs for large capital projects in industries including the energy, transportation, communication, mining, and oil and gas sectors in North America. "The widespread declines in equipment prices reflect broad energy industry trends as low oil prices have forced companies to reduce spending, especially on new projects. This had led to lower equipment demand from engineering, procurement, and construction firms that build infrastructure and refining facilities in the energy industry," says Thomas McCartin, senior economist at IHS Markit.

The materials and equipment sub-index recorded a third consecutive month of falling prices, IHS Markit says. Survey respondents reported falling prices for nine out of the 12 components, with only ready-mix prices increasing. Ocean freight prices to the US from Europe and Asia stayed flat.

Index prices for fabricated steel, alloy steel pipe and carbon steel, and copper wire and cable were higher relative to April, although still in contraction territory in May. This illustrates that although the majority of respondents noted falling prices, there were a few responders who registered price increases, it says. On the other hand, index figures for equipment fell relative to April, with falling prices more widely observed in these categories, it adds.

The sub-index for current subcontractor labor costs came in at 45.7 in May, a slight uptick from April’s low of 34.3. Labor costs rose in the US northeast and south but fell in the Midwest and west. Labor costs also declined in both eastern and western Canada, the ECCI shows.

The six-month headline expectations for future construction costs fell in May to 42.0, an all-time low for the ECCI, says IHS Markit. Both the materials/equipment and labor subcomponents recorded expectations for future price decreases. The six-month materials and equipment expectations index came in at 39.9 in May, down from 40.7 in April, with responders expecting falling prices for nine out of 12 categories.

Expectations for subcontractor labor registered 46.9 this month, a slight uptick from 45.2 in April. While the Northeast is expected to see higher labor costs in six months’ time, those costs are expected to stay flat in the South. Labor costs in Canada, the US Midwest, and West are expected to keep falling, according to the ECCI.

Respondents noted in survey comments the lower demand conditions were due to the coronavirus disease 2019 (COVID-19) pandemic. The headline IHS Markit PEG ECCI fell in April for the first time since November 2016, sending engineering and construction costs negative after a period of 41 consecutive monthly increases, due to the impact of COVID-19 since January largely on the energy industry.

As MRC informed earlier, European Council decided, after a special meeting held on 21 July, to introduce a levy on non-recycled discarded plastic as part of the EU's COVID-19 recovery plan. However, Germany's chemical industry association VCI (Frankfurt) had, prior to the EU Council’s meeting, expressed opposition to the project because it adds a regulatory and cost burden rather than supporting packaging recyclability.

As MRC informed before, members of the European Parliament (MEPs) are proposing ways to step up green energy storage solutions such as hydrogen or home batteries, in a report that was adopted in one of the Parliament’s voting sessions on Friday, 10 July. The proposals outlined in the report are set to play a crucial role in reaching the goals of the Paris Agreement on Climate Change, as more efficient energy-storage options in the EU will help "spur decarbonization," the EU Parliament says. In addition, since solar and wind have a variable electricity output, more storage solutions should become available to secure supply, MEPs say.

According to MRC's DataScope report, PE imports to Russia dropped in January-June 2020 by 7% year on year to 328,000 tonnes. High density polyethylene (HDPE) accounted for the main decrease in imports. At the same time, PP imports into Russia rose in the first six months of 2020 by 21% year on year to 105,300 tonnes. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.
MRC

MOSCOW (MRC) -- The coronavirus pandemic underscored BP's efforts to "reimagine energy" by taking a leading role in the push to cleaner, low-carbon fuels, said S&P Global, citing CEO Bernard Looney.

Rising levels uncertainty over the future demand for oil, oil price volatility, a growing attractiveness of stable returns from some renewables, and an increased awareness of "the fragility of the world we live in" mean BP is taking the right path to pursue lower-carbon fuels, Looney said.

"We are maintaining momentum on the plans for reimagining energy and reinventing BP," Looney said in a speech at a webcast annual general meeting. "The more we understand the current situation, the more I am convinced that the decisions we took in February are right."

In February, Looney set out ambitious new targets for the oil major to become a "net-zero" carbon emitter by 2050 or sooner as he looks to position the company to take a leading role in tackling climate change with cleaner energy.

Under a number of as yet, loosely defined goals, BP plans to get to net-zero on the carbon content of the company's oil and gas production by 2050 or sooner and see its oil and gas output decline gradually "over time".

Like many of its oil major peers, BP also aims to increase its investment in non-oil and gas businesses, currently running at around USD500 million a year, or roughly 3% of overall capex.

Looney, who succeeded Bob Dudley as CEO in February, said BP was making "good progress with this transformation" and planned to provide a detailed update on its efforts at a strategy presentation in September.

The heads of the world's largest oil and gas producers pledged Tuesday to maintain a strategic focus on producing cleaner energy and helping to mitigate climate change despite reeling from the impact of the coronavirus pandemic on oil and gas prices.

As MRC informed earlier, the Turkish Competition Council has given permission to SOCAR and BP to establish a joint venture that will operate in the petrochemical sector, local media reported on July 22. Earlier it was reported that SOCAR and BP applied to the relevant institutions in Turkey to establish a joint petrochemical company, which will be called Mercury complex, in April 2020. Recall that on December 20, 2018 SOCAR and BP signed contractual principles for evaluation of plans for creation a world-class petrochemical complex in Turkey and establishment of a joint venture to manage it.

PTA is the main raw material in the production of polyester from which beverage and food containers, packaging materials, photo and film and other consumer and industrial goods are derived.

According to ICIS-MRC Price report, in Russia, July formulae PET prices for contract customers were in the range of Rb65,000-67,500/tonne CPT Moscow, including VAT. Prices of material in the spot market remained steady last week, Russian producers continued to ship material from 20 tonnes at a price of Rb70,000-72,000/tonne CPT Moscow, including VAT.
MRC