A&R Logistics acquires L.T. Harnett, expanding liquids service

MOSCOW (MRC) -- A&R Logistics (Chicago, Illinois) has acquired L.T. Harnett Trucking (LTH; Kinsman, Ohio), a provider of over-the-road bulk liquid chemical transportation and logistics services with a network of five terminals in Ohio, Indiana, and Illinois, according to Chemweek.

The deal is A&R’s second in the liquid chemical space, the first being the acquisition of First Choice Logistics in February.

A&R says the entire LTH leadership team will join A&R, and current owners the Harnett family will become a major independent investor. Financial details were not disclosed.

The addition of LTH will double A&R’s liquid chemicals revenue and expand its range in liquids beyond Illinois and the Gulf of Mexico, notes Konrad Salaber, managing director of Wind Point Partners, the private equity firm that acquired A&R in May 2019. “Establishing and subsequently expanding A&R's liquid chemical solutions was a core element of our value-creation plan, and we are thrilled to see LTH join the A&R family. We look forward to continuing to build upon our liquid chemical network."

A&R has purchased a total of four businesses since its acquisition by Wind Point, the others being Blue Water Plastic Transport, in June 2019, and Plantgistix, in November 2019.

As MRC informed before, chemical railcar traffic in North America remain firm, according to data released on 12 August by the Association of American Railroads (AAR). During the week ended 8 August, volume year-to-date (YTD) was down 4.7% from 2019, within the 4.6-4.7% range observed since late June. On a four-week basis, volume decreased 4.5% from 2019 and 7.2% from 2018. Weekly volume totaled 43,005 carloads, down 5.6% year-over-year (YOY) and down 2.4% from the previous week. Chemical railcar traffic in the United States contributed 31,297 carloads to the total, down 2.5% YOY and up 0.1% from the previous week. For the year to date, US chemical railcar traffic is down 5.0%.

We remind that in early July, 2020, Dow agreed to sell the rail infrastructure assets and related equipment at six major sites in North America to Watco Companies (Pittsburg, Kansas), a transportation services company operating in North America and Australia. Dow expects the deal, which is slated to close in the fourth quarter, to yield over USD310 million in cash. Watco will provide Dow with rail services from the assets under a long-term agreement.

We also remind that Dow Chemical restarted three polyethylene (PE) plants it shut in April on improving demand after widespread economic shocks in April and May, confirmed a company spokeswoman July 23.

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.
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MOSCOW (MRC) -- A unit failure at Royal Dutch Shell’s 404,000 barrel per day Pernis oil refinery in Rotterdam on Aug. 17 has been resolved, reported Reuters with reference to the company's statement.

The oil major said on Monday that the unit failure had led to flaring at the refinery, without identifying the unit in question.

As MRC wrote before, Shell will announce a major restructure by the end of the year as the company prepares to accelerate its shift toward its net-zero emissions goal by 2050, said CEO Ben van Beurden to employees. The restructuring will include workforce reductions as part of broader cost-cutting measures, although no figures have been decided yet, the CEO reportedly said during an internal webcast.

We remind that Royal Dutch Shell Plc plans to idle a sulfur recovery unit (SRU) at the joint-venture Deer Park, Texas, refinery in 2021, said Shell spokesman Curtis Smith in July 2020. Currently, the refinery is operating at about 75% of its 318,000 barrel-per-day capacity because of reduced demand due to the COVID-19 pandemic.

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

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.

Royal Dutch Shell plc is an Anglo-Dutch multinational oil and gas company headquartered in The Hague, Netherlands and with its registered office in London, United Kingdom. It is the biggest company in the world in terms of revenue and one of the six oil and gas "supermajors". Shell is vertically integrated and is active in every area of the oil and gas industry, including exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading.
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MOSCOW (MRC) -- Henkel Adhesive Technologies, a market leader of high-impact solutions in adhesives, sealants and functional coatings, recently broke ground for a new, state-of-the-art production area for UV-curable acrylic pressure sensitive adhesives (PSA) at the site in Salisbury, North Carolina, said the company.

The new facility is expected to be operational by the end of 2021. This expansion of Henkel’s existing site broadens the company’s capabilities to provide more sustainable and innovative pressure sensitive adhesive solutions to the tape, label, medical, and graphic films markets.

"Henkel’s solvent-free, UV PSA line enables broader industry use of acrylic-based adhesives. Combining the ease of use of a traditional rubber-based hot melt with the enhanced performance of acrylic polymers represents not only a step-change in innovation but demonstrates Henkel’s continued commitment to sustainability,” said Brian McSwigan, Vice President of Business Development.

UV-curable hot melt adhesives address changing market needs and enhance the customer experience. They are designed to coat a variety of facestocks, serving all segments of traditional pressure sensitive markets. Branded as Loctite Durotak UV, Henkel will offer a comprehensive set of adhesive chemistries from this new facility, including pure polymer, formulated free radical, and cationic curing systems. Unique to Henkel, cationic cured UV PSAs utilize a novel curing page 2/3 mechanism, allowing for lower energy consumption and through-cure of extremely high coat weights (double to triple that of traditional free radical systems).

"This is an exciting time for Henkel as we begin construction of our first UV pressure sensitive adhesive manufacturing facility here in North America. We remain focused on enhancing the consumer experience bringing real value to our customers and their brands,” said Gary Rzonca, Vice President, Packaging & Consumer Goods, North America.

Henkel’s Salisbury facility manufactures adhesives used extensively in the packaging, consumer goods and electronics markets. Created with consumers in mind, Henkel’s consumer packaging adhesives offer high-impact solutions to allow fast moving consumer goods companies to achieve efficient, reliable, and sustainable solutions.

As MRC informed earlier, Henkel AG & Co. KGaA (Dusseldorf, Germany) announced that Henkel Adhesives Technologies has officially inaugurated its new production facility in Kurkumbh, India.

Henkel are also partnering with Borealis and plastics solutions company Borouge to develop flexible packaging solutions for detergents containing both virgin polyethylene (PE) and high amounts of post-consumer recyclate (PCR) in efforts to increase sustainability.

As MRC informed earlier, Russia's output of chemical products rose in June 2020 by 2.6% year on year. However, production of basic chemicals increased year on year by 4.9% in the first six months of 2020. According to the Federal State Statistics Service of the Russian Federation, polymers in primary form accounted for the greatest increase in the output in January-June. Production of benzene was 106,000 tonnes in June 2020, compared to 110,000 tonnes a month earlier. Overall output of this product reached 721,000 tonnes over the stated period, up by 3.9% year on year.
MRC

MOSCOW (MRC) -- The American Chemistry Council (ACC; Washington, DC) has named Joshua Baca vice president/plastics, effective 8 September, reported Chemweek.

Baca is currently senior vice president/public affairs at the American Beverage Association (ABA), where he led the launch of a new sustainability initiative and helped advance community-based recycling projects, says ACC. The previous vice president of the plastics division, Steve Russell, retired earlier this year.

“Joshua brings deep expertise on complex environmental and sustainability public policy issues that require coalition and consensus-building,” says ACC president and CEO Chris Jahn. “Nowhere is that more critical than helping to identify, advance, and implement large-scale solutions to solve the issue of plastic waste in our environment.”

As MRC wrote before, in January, 2019, Thailand’s Indorama Ventures (IVL) completed a deal to acquire a plant for the processing of polyethylene terephthalate (PET) from the US company Custom Polymers PET. Indorama acquired a PET processing plant on January 2 and closed the deal on January 15. The plant is located next to the AlphaPet polyester plant in Alabama, USA. The deal was announced in December, 2018. The complex consists of two production lines - one for the production of recycled PET (A-PET) flakes, and the other for the production of food A-PET, with a total capacity of 31 thousand tons per year. This acquisition delivers recycled PET for the food packaging sector, as well as for the fiber sector in North America.

According to MRC's ScanPlast report, Russia's estimated PET consumption totalled 367,720 tonnes in the first six months of 2020, up by 19% year on year. Russian companies processed 62,910 tonnes of material in June.
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MOSCOW (MRC) -- US petroleum inventories show clear signs of trending lower as consumption slowly recovers from the epidemic and lockdowns, while Saudi Arabia restricts production and directs volumes away from North America, according to Hydrocarbonprocessing.

Total petroleum inventories fell last week for the fourth time in five weeks, and are now down more than 17 million barrels since early July, according to data from the USEnergy Information Administration.

The drawdown has started to whittle away some of the 222 million barrels built up between the end of March and the end of June.

Petroleum inventories are still 148 million barrels (7.5%) higher than at the same time last year and 137 million barrels (7.0%) above the five-year average.

But the relentless increase in stocks during the second quarter has given way to consistent draws which indicates the market has switched from a production surplus to deficit.

The first phase of rebalancing has been concentrated entirely in crude, where stocks have fallen 27 million barrels since early July, accounting for all the total draw over this period.

Crude inventories, including the strategic petroleum reserve, are still 46 million barrels (4%) above the five-year average, but the surplus has shrunk from 64 million (6%) in mid-July.

The drawdown in crude stocks has been accelerated by a sharp slowdow in crude oil imports, especially from Saudi Arabia.

Crude imports are running well under 6 million barrels per day, close to recent lockdown lows, and among the slowest rates since the early 1990s.

For the fourth week running, imports from Saudi Arabia were well below the average for the past year.

Volume warfare, which sent US inventories surging when extra tankers discharged their cargoes into the United States between late May and early July, has given way to an effort to starve the US market to bring stocks down.

By contrast, inventories of refined fuels and intermediate semi-refined products, have not shown a consistent down trend. Distillate fuel oil stocks, in particular, have remained stubbornly high.

Fuel consumption and refinery crude runs are edging slowly higher but remain 8% and 15% respectively below the prior-year five-year average.

In turn, weak fuel consumption and bloated stocks are weighing on product prices and keeping margins, especially for distillates, close to multi-year lows.

By restricting crude processing well below prior-year levels, refiners are gradually digesting the excess stocks built up during lockdown, but progress is much slower than the rebalancing of the crude market.

As MRC informed before, US crude oil inventories moved sharply lower during the week ended July 24 as exports and refinery demand climbed to multi-month highs, US Energy Information Administration data showed July 29. Commercial crude stocks fell 10.61 million barrels to 525.97 million barrels that week, EIA data showed. While the draw pushed stockpiles to 14-week lows, they remained more than 17% above the five-year average for this time of year.

Earlier this year, BP said the deadly coronavirus outbreak could cut global oil demand growth by 40 per cent in 2020, putting pressure on Opec producers and Russia to curb supplies to keep prices in check.

And in September 2019, six world's major petrochemical companies in Flanders, Belgium, North Rhine-Westphalia, Germany, and the Netherlands (Trilateral Region) announced the creation of a consortium to jointly investigate how naphtha or gas steam crackers could be operated using renewable electricity instead of fossil fuels. The Cracker of the Future consortium, which includes BASF, Borealis, BP, LyondellBasell, SABIC and Total, aims to produce base chemicals while also significantly reducing carbon emissions. The companies agreed to invest in R&D and knowledge sharing as they assess the possibility of transitioning their base chemical production to renewable electricity.

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

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.
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