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COVID-19 - News digest as of 10.08.2020

August 10/2020

1.CIA says majority of UK chemical companies expect improved stability, sales in third quarter

MOSCOW (MRC) -- A survey of UK chemical companies has revealed that 80% expect improved stability and a rise in domestic and international export sales over the next three months, with over 70% also seeing the same upward trend for exports to the EU, despite significant uncertainty remaining, said Chemweek. The survey of its member companies by the Chemical Industries Association (CIA; London, UK) shows the majority also expect to see an improvement in capital expenditure, although around 10% of companies expect job losses and a reduction in R&D expenditure. The decline in industry sales came to a halt in the second quarter of 2020, with half of the companies surveyed now reporting stability or improvement, the CIA says. Exports to the EU and the rest of the world remained at current levels or improved during the quarter for half of those surveyed, as did capex and business utilization, it says. Stability and growth in employee numbers during the quarter, as well as spending on R&D, was reported by 80% of companies contacted, it adds.

2. Toray income dives on declining demand due to COVID-19

MOSCOW (MRC) -- Toray Industries reports a 62.8% drop in net income for its fiscal first quarter ended 30 June, to ?9.5 billion (USD90 million), compared with ?25.6 billion a year earlier, according to Chemweek. Operating income plummeted 63.7% year on year (YOY) to ?12.5 billion. Revenue was ?397.6 billion, a decrease of 22.5% YOY. Sales by Torays fibers and textiles segment were ?145 billion, a decline of 25.9%. Operating income plunged 50.3% YOY to ?7.2 billion. All applications of the segments products were affected by stagnation in production activities and consumption behavior caused by the COVID-19 pandemic in Japan and overseas. In apparel applications, demand declined due to lockdowns and the closure of retail stores in various countries. In industrial applications, sales volume for mainstay automotive applications decreased as car manufacturers suspended operations and decreased production volume.

3. Orbit export terminal to start shipping ethane by November to cracker in China

MOSCOW (MRC) -- Energy Transfer Partners (ETP; Philadelphia, Pennsylvania) says the companys Orbit ethane export terminal at Nederland, Texas, should be commissioning its first ships in November, reported Chemweek. ETP is developing the terminal in a joint venture with Chinas Satellite Petrochemical. A first steam cracker nearing completion by Satellite Petrochemical in Jiangsu Province, China, will be online in the fourth quarter of this year, with a second cracker facility also using ethane feedstock scheduled to start up in the first half of 2021, according to ETPs CFO Tom Long on a recent quarterly earnings call. For the first time at Nederland well be bringing on 180,000 b/d of ethane capacity, primarily for (Satellite), Long says. However, we are chasing other markets. We do anticipate selling ethane to other third parties as early as the first quarter of next year. And well do everything we can to fully utilize that facility on a daily basis, depending on what Satellite actually pulls on a daily basis. ETP produced record volumes of natural gas liquids (NGLs) in the second quarter, despite the COVID-19 pandemic wreaking havoc on energy demand.

4. BP Midstream pipeline volumes fall in second quarter, but revenues up

MOSCOW (MRC) -- BP Midstream Partners LP pipeline volumes fell roughly 10% in the second financial quarter as efforts to curb the spread of the coronavirus pandemic slashed fuel demand, reported Hydrocarbonprocessing with referemce to company executives. Despite lower volumes, revenue of BPs US pipeline unit rose to USD31.50 in the three months ending June 30 from USD28.6 million in the same period last year as it clamped down on expenses.

5. Cabot swings to loss on collapse of automotive

MOSCOW (MRC) -- Cabot Corporation (Boston, Massachusetts) reports a fiscal third-quarter net loss of USD6 million, down from income of USD32 million in the year-ago quarter, said Chemweek. Net sales totaled USD518 million, down 39% year-over-year (YOY) from USD845 million. The company attributes the results to the sharp decline in the automotive and tire sectors. Adjusted earnings per share came to a 7-cent loss, down from profit of USD1.00 in the year-ago period, and short of the average analyst estimate of a 2-cent loss as compiled by Refinitiv (New York). "Volumes and product mix across our businesses declined by over USD100 million in the third quarter as compared to the prior-year quarter, driven primarily by lower demand in the tire and automotive sectors as manufacturers temporarily halted production in response to the COVID-19 pandemic," says president and CEO Sean Keohane. As the quarter progressed, our customers slowly restarted operations during May and June. The sequential improvement in monthly reinforcement materials volumes through the quarter is a positive indicator that we are exiting the quarter in a stronger position than where we started."

6. MOL sees downstream earnings slide, petchems performance robust

MOSCOW (MRC) -- MOL (Budapest, Hungary) has reported a 58% decline year on year (YOY) in its downstream EBITDA earnings to USD110 million for the second quarter on a current cost of supply (CCS) basis, due largely to negative refinery margins, despite a resilient contribution from its petrochemical activities, reported Chemweek. The company, which does not break out its petchem earnings separately, says the quarter featured major operational challenges with unprecedented price and margin movements. The contribution from its petchems activities remained resilient, as both margins and volumes held up reasonably well during the pandemic, it says.

7. Lotte Chemical earnings plunge on lower sales, prices, forecasts upturn in third quarter

MOSCOW (MRC) -- Lotte Chemical said Friday its second-quarter net profit fell 88.7 percent from a year earlier due to low demand amid the coronavirus pandemic, said Koreantimes. For the April-June period, Lotte Chemical posted a net profit of 30.6 billion won (USD25.8 million), compared with a profit of 271.2 billion won a year earlier, the company said in a regulatory filing. Lotte Chemical said the decreased profit is blamed on lower prices of its major products due to slowing demand in the markets amid increased uncertainty over the COVID-19 pandemic and trade disputes between the United States and China.

8. Lukoil Q2 oil production down 11.6% on year to 1.52 mil b/d

MOSCOW (MRC) -- Russia's second largest crude producer, Lukoil, said Aug. 7 that its oil production, excluding the West Qurna 2 project, fell to 18.82 million mt in the second quarter, in line with deeper cuts under the OPEC+ agreement, reported S&P Global. This is equivalent to an average of around 1.52 million b/d, down 11.6% on the year and 12% on the quarter. From May, Russian producers including Lukoil were subject to the strictest output restrictions so far under the OPEC+ agreement as the group attempted to ease market volatility caused by the coronavirus pandemic.

9. Crude oil futures retreat after overnight rally, steady US dollar

MOSCOW (MRC) -- Crude oil futures were lower during mid-morning trade in Asia Aug. 4 as traders took profit after the overnight rally amid better-than-expected global economic data, reported S&P Global. At 11:07 am Singapore time (0307 GMT), the ICE Brent October crude futures was down 30 cents/b (0.68%) from the August 3 settle at USD43.85/b, while NYMEX September light sweet crude contract was down by 27 cents/b (0.66%) at USD40.74/b. In the US, IHS Markit July manufacturing PMI released on Aug. 3 stood at 50.9, an improvement from June's 49.8, while the Institute of Supply Management's manufacturing PMI rose to 54.2% in July, up from 52.6% in June, exceeding market expectations. "However, when it comes to manufacturing output, it continues to suggest it's easier for the central bank and government stimulus to fire up the industrial heartlands," Stephen Innes, chief global markets analyst at AxiCorp, said in an Aug. 4 note. "Still, it remains a challenge to get people working again or even in some US states to leave their apartment," he added. Meanwhile, even as the number of new COVID-19 cases in the US has continued to move lower for a fifth consecutive day, from a high of 70,800 cases on July 29 to 47,500 cases on Aug. 2, according to latest data from John Hopkins University, deaths from COVID-19 rose for the fourth week in a row, according to media reports.
Author:Margaret Volkova
Tags:Asia, Europe, PP, PE, ABS, crude and gaz condensate, propylene, ethylene, car components, petrochemistry, BP Plc, Cabot Plastics, Honam Petrochemical, Lotte Chemical, Toray, TVK, Lukoil, COVID-19, Russia, USA.
Category:General News
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