US crude stockpiles fall even as imports jump

MOSCOW (MRC) -- US crude oil stockpiles fell in the second week of August even as net imports jumped sharply, while fuel demand dipped as well, reported Reuters with reference to the US Energy Information Administration's statement.

Crude inventories fell by 1.6 million barrels in the week to Aug. 14 to 512.5 million barrels, less than analysts’ expectations in a Reuters poll for a 2.7 million-barrel drop.

Net US crude imports rose by 1.1 million barrels per day to 3.6 MMbpd, the EIA said.

Fuel demand dropped by more than 2 MMbpd to 17.2 MMbpd in terms of product supplied. Overall fuel demand is down 14% from the year-ago period over the last four weeks.

As the summer driving season comes to a close, overall fuel demand tends to decline.

Prices rose briefly following the report. U.S. crude futures were down 26 cents, or 0.6%, to USD42.63 a barrel by 11:01 a.m. ET (1501 GMT), while Brent dropped 37 cents to USD45.09 a barrel.

Refinery crude runs fell by 171,000 bpd in the last week, EIA said, while refinery utilization rates fell by 0.1 percentage point.

US gasoline stocks fell by 3.3 million barrels to 243.8 million barrels, the EIA said, compared with analysts’ expectations for a 1.1 million-barrel drop.

Distillate stockpiles, which include diesel and heating oil, rose by 152,000 barrels, versus expectations for a 557,000-barrel drop. Overall distillate stockpiles sit at 177.8 million barrels, just off a 38-year-high set last month.

“It is concerning that distillate inventories continue to remain at very high levels as refiners blend excess jet fuel supplies into diesel,” said Andrew Lipow, president at Lipow Oil Associates in Houston.

As MRC wrote previously, 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 last 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. The inventory draw was concentrated on the US Gulf Coast, where stocks fell 10.46 million barrels to 295.51 million barrels, and on the US West Coast, where stocks fell 1.7 million barrels to 52.75 million barrels, the lowest since mid-March.

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.
MRC

MOSCOW (MRC) -- The plastics industry requires a paradigm shift towards an absolute decoupling of materials consumption from growth of the economy if it is to achieve sustainability targets, according to new research from research firm Wood Mackenzie, said Canplastics.

"This shift, a term we call the materials transition, is the process through which we account for – and seek to minimise – the costs of extracting and disposing of raw materials consumed in the global economy,” said Guy Bailey, Wood Mackenzie’s head of intermediates and applications. “The materials transition is driven by societal concern, regulatory interventions and technological innovation."

If all plastic packaging companies put the materials transition at the heart of their sustainability strategies, what would this mean in terms of plastic production and waste generation? Wood Mackenzie ran two scenarios focused on the major packaging polymers – polyethylene (PE), polypropylene (PP) and polyethylene terephthalate (PET) – to answer this question. A “Current Path” scenario represents the world if it continues as it is today, while a “Sustainable Future” scenario sees more stringent legislation implemented to incentives companies to be ambitious.

Under Wood Mackenzie’s “Current Path” scenario, the global recycling rate for the selected polymers more than doubles between now and 2040, rising from 17% to 38% of polymer produced for packaging applications.

Under Wood Mackenzie’s “Sustainable Future” scenario, there’s a significant increase in volumes of packaging going through mechanical recycling processes, and significant investment in chemical recycling technologies and capacities. Faster growth in the recycling of flexible, multi-material and coloured packaging follows.

The cumulative impact of these changes is another near doubling of the recycling rate for the observed packaging polymers, rising to approximately 67%. In 2040 alone, this results in an additional 53 million tonnes of packaging plastic prevented from going into landfill, energy recovery or unmanaged waste streams in comparison to the ‘Current Path’ scenario. Cumulatively, from 2020 to 2040, this rises to 382 million tonnes.

"It’s clear to see that chemical recycling has the potential to significantly increase recycling levels,” Bailey said. “However, the impact of this on the value chain will depend on how circular the recycling chain is. For instance, how much recycled plastic is ‘downcycled’ into non-circular products – such as reclaimed plastic bottles recycled into polyester fibres – and the precise split between recycling routes."

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) -- Through the acquisition of the Solvay polyamide (PA) business, BASF has enhanced its R&D capabilities in Asia Pacific with new technologies, technical expertise, and upgraded material and part testing services, as per BASF's press release.

BASF is planning to integrate the R&D centers from Solvay into its R&D existing facilities in Shanghai, China, and Seoul, Korea. The enhanced capabilities will boost BASF’s position as a solution provider to develop advanced material solutions for key industries.

“Pursuing innovation in new products and applications is our goal. We will leverage the extensive know-how of the combined business to develop advanced customer-oriented material solutions, as well as to drive more projects with our customers,” said Andy Postlethwaite, Senior Vice President of Performance Materials Asia Pacific, BASF. “Our offering will be further supported by additional production capacity and a more extensive product portfolio, which includes new high-temperature grades.”

With the acquisition of the Solvay polyamide business, BASF now has its first UL certified lab in Asia, adding to BASF’s existing labs, which have an ISO 17025 accreditation. As such, test data obtained from UL accredited labs can be used directly to apply for UL’s Yellow Card which is a globally recognized certification on quality, safety, and performance of plastic products. This UL certified testing capability can significantly shorten the verification process, and thus the time-to-market of flame-retardant products.

The new lab, located in Shanghai, will be part of the company’s comprehensive global R&D network and complement BASF’s existing flame-retardant grade polyamide testing service, mainly for electronic and electrical solutions.

BASF has expanded its part testing capabilities with eight new tests in Shanghai, including electrodynamic shaker, burst, glycol circulation, oil separation, and stone impact. In the future, all related parts can be tested directly in Shanghai, which will make product development more efficient.

Additionally, BASF can now evaluate final parts with its expanded testing expertise. By validating the performance of the final parts with the new testing capabilities, BASF can help increase its customers’ product development success rate and speed-to-market.

The enhanced facilities can enable in-depth analysis and evaluation of some unique features, such as aging resistance to heat, oil, and coolant. BASF’s expertise provides a deep understanding of test specifications, which have a significant impact on the results, empowering material development for the future of the automotive industry.

“The strengthened capabilities in R&D will help us give a quicker response to customers in Asia Pacific, speed up the time to market and be more competitive in the engineering plastics market,” said Postlethwaite.

As MRC reported previously, BASF will increase its alkoxylate capacity in Asia Pacific, with its latest investment in Jinshan, China. The company has acquired land, buildings and assets of SPC, related to alkoxylates production, adjoining the BASF Jinshan site, in order to fulfil the growing demand from customers across Asia Pacific, especially China. With the current alkoxylate line in the Care Chemicals Jinshan plant running at full capacity, this acquisition will help double the capacity at Jinshan from end 2020.

We remind that BASF-YPC, a 50-50 joint venture of BASF and Sinopec, undertook a planned shutdown at its naphtha cracker on 30 April 2020. The company initially planned to start turnaround at the cracker on April 5, 2020. The plant remained under maintenance unitl 18 June, 2020. Located in Jiangsu, China, the cracker has an ethylene capacity of 750,000 mt/year and propylene capacity of 400,000 mt/year.

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.

BASF is the leading chemical company. It produces a wide range of chemicals, for example solvents, amines, resins, glues, electronic-grade chemicals, industrial gases, basic petrochemicals and inorganic chemicals. The most important customers for this segment are the pharmaceutical, construction, textile and automotive industries. BASF generated sales of EUR59 billion in 2019.
MRC

MOSCOW (MRC) -- 3M Canada in Brockville, Ont. will produce as many as 100 million N95 masks a year following a roughly USD70-million agreement with the federal and Ontario governments, said Canplastics.

Prime Minister Justin Trudeau and Ontario Premier Doug Ford announced the deal on Aug. 21 at the Brockville facility.
Ottawa and the province will each contribute USD23.3 million to expand manufacturing capabilities at the Brockville plant – where 3M makes tape and other materials – allowing it to produce the increased amount of masks, which are made from synthetic plastic fibres.

The masks are considered a critical piece of protection in the ongoing battle against COVID-19.

The masks made at the expanded facility will be used to meet “private sector, provincial, and North American market demand throughout the pandemic and beyond,” said Robert Gibson, a spokesman for Ontario’s minister of economic development.

"With mask production in Brockville, it increases public confidence in our PPE supply chain. We can count on Canadians making masks for Canadians,” Leeds-Grenville-Thousand Islands and Rideau Lakes MP Michael Barrett said in a statement. “It’s important that Canadians have a secure and reliable source for these important products and our skilled workers here are certainly up to the task."

As MRC informed earlier, SIBUR and 3M have signed an agreement to cooperate in product development and polymer recycling at SIBUR’s PolyLab. Thanks to their durability, strength, eco-friendliness and other advantages, such polymers as polyethylene and polypropylene are some of the most widely used synthetic materials, popular with the construction, utilities, automotive, healthcare, food and other industries.

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) -- Indian Oil says it will build an integrated paraxylene (PX) and purified terephthalic acid (PTA) facility at Paradip in Odisha State, India, at an estimated investment of 138 billion Indian rupees (USD1.84 billion), reported Chemweek.

The project will be completed by early 2024, with the complex planned to produce 800,000 metric tons/year of p-xylene and 1.2 million metric tons/year of PTA, it says.

The complex will be integrated with the company's refinery at Paradip. The PX and PTA facilities, along with a previously announced 357,000-metric tons/year monoethylene glycol (MEG) plant at Paradip, would provide feedstock for a 300,000-metric tons/year textile yarn manufacturing project at Bhadrak, Odisha, and will facilitate other textile and polyester projects in the region, Indian Oil says. The MEG plant is being developed with an investment of Rs47.87 billion and is due to be completed in early 2021. The company also plans to produce up to 50,000 metric tons/year of toluene, it says.

Indian Oil says that with the commissioning of both the PTA and MEG projects, “the petrochemical intensity index of Paradip refinery will increase to 14.7 from the present level of 4.5.” The company commissioned a 680,000-metric tons/year polypropylene (PP) plant in February 2019 at Paradip.

The complete ecosystem of bulk petrochemicals would be available in the petroleum, chemicals, and petrochemicals investment region (PCPIR), which would catapult Odisha's petchems industry to global standards, according to Indian Oil. Paradip has been identified as one of India's PCPIR zones.

Indian Oil is the anchor tenant at Paradip and the major source of feedstocks for downstream industries in the region. Odisha, located on India's east coast, has the potential to cater to increasing demand for chemicals and petchems in Southeast Asian countries, the company says.

As MRC informed before, the state-owned Indian Oil Corp Ltd shut its (PTA plant in India for maintenance in early-February, 2019. The plant remained under maintenance until end-February, 2019. Located in Panipat, India, the PTA plant has a production capacity of 550,000 mt/year.

PTA is used to produce polyethylene terephthalate (PET), which is used in the manufacturing of plastic bottles, films, packaging containers, in the textile and food industries.

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.

Indian Oil Corporation Limited, or IndianOil, is an Indian state-owned oil and gas corporation with its headquarters in New Delhi, India.
MRC