PP imports into Kazakhstan increased by 7% in January - September, exports down by 6%

MOSCOW (MRC) - Imports of polypropylene (PP) in Kazakhstan grew to 29,600 tonnes in first nine months of this year, up 7% compared to the same period of 2019. PP exports decreased by 6%, reported MRC analysts.

September PP shipments to Kazakhstan grew to 2,500 tonnes from 2,000 tonnes a month earlier, local converters decreased their purchasing of homopolymer PP in Azerbaijan. Total PP imports into the country reached 29,600 tonnes in January - September 2020, compared with 27,500 tonnes in the same time a year earlier. At the same time, the forced shutdown for a turnaround at the local producer's production capacities led to lower export sales.

September imports of homopolymer PP and propylene copolymers increased to 1,700 tonnes and 820 tonnes, respectively, versus over 1,300 tonnes and 710 tonnes a month earlier, local companies significantly increased their PP purchases from Azerbaijan and South Korea. Overall imports of homopolymer PP and propylene copolymers reached 24,000 tonnes and 5,600 tons, respectively, in January-September 2020, compared to 22,000 tonnes and 5,600 tonnes a year earlier.

Kazakhstan's PP exports over the first nine months dropped to 17,300 tonnes, whereas this figure was 18,400 tonnes a year earlier.
Such a significant decrease in export volumes was due, among other things, to the long shutdown of the local producer, the Neftekhim LTD Company in April- June of the current year.

MRC

PP imports in Russia grew by 19% in January-October

MOSCOW (MRC) -- Polypropylene (PP) imports into Russia increased by 19% year on year to 181,100 tonnes in the first ten months of 2020.
Propylene homopolymer (homopolymer PP) accounted for the main increase in imports, according to MRC's DataScope report.

Russian companies decreased their purchasing of PP in foreign markets in October including due to the reduction of export quotas from some producers, imports amounted to 17,900 tonnes against 19,900 tonnes a month earlier. Thus, overall PP imports into Russia reached 181,100 tonnes in January-October 2020, compared to 152,100 tonnes a year earlier. Purchasing of all grades of propylene polymers in foreign markets increased, with homopolymer PP imports accounting for the most noticeable rise.

Overall, the structure of PP imports by grades looked the following way over the stated period.

October imports of homopolymer PP were about 6,000 tonnes versus 7,500 tonnes a month earlier, homopolymer PP shipments from Azerbaijan and Uzbekistan decreased. Thus, overall imports of homopolymer PP to Russia totalled 74,400 tonnes in the ten months of 2020, compared to 48,100 tonnes a year earlier.

October imports of PP block copolymers in Russia were about 5,200 tonnes against 4,900 tonnes in September, demand for Middle Eastern injection moulding polypropylene increased from Russian companies due to limited supply from local producers. Imports of PP block copolymers into Russia reached 48,900 tonnes in January-October 2020, compared to 47,000 tonnes a year earlier.

October imports of statistical copolymers of propylene (PP random copolymer) dropped to 3,200 tonnes from 4,900 tonnes a month earlier, with pipes producers accounting for the main reduction in shipments due to higher prices in Russia. Total imports of PP random copolymers in Russia were 31,600 tonnes in January - October 2020, compared with 26,900 tonnes year on year.

Russia's imports of other polymers of propylene for the period were about 26,300 tonnes in the first ten months of the year, compared with 30,000 tonnes year on year.

MRC

PE imports to Russia down by 16% in Jan-Oct 2020

MOSCOW (MRC) -- Polyethylene (PE) imports into Russia fell in January-October 2020 by 16% year on year to 524,600 tonnes. High density polyethylene (HDPE) accounted for the greatest decrease in imports, according to MRC's DataScope report.

October PE imports grew to 49,600 tonnes from 46,200 tonnes a month earlier, shipments of linear low density polyethylene (LLDPE) and low density polyethylene (LDPE) increased. Overall imports of ethylene polymers totalled 524,600 tonnes in the first ten months of 2020, compared to 621,200 tonnes a year earlier. All ethylene polymers accounted for lower imports, with LDPE being the exception.

The structure of PE imports by grades looked the following way over the stated period.


October HDPE imports dropped to 18,100 tonnes from 18,600 tonnes a month earlier, shipments of injection moulding and film grade PE from Central Asia decreased. Overall imports of this PE grade totalled 220,600 tonnes in January-October 2020, down by 29% year on year. Film grade and pipe grade HDPE accounted for the main reduction in shipments.

Last month's LDPE imports exceeded 10,200 tonnes versus 8,900 tonnes in September. Overall LDPE imports to Russia reached 93,500 tonnes in the first ten months of 2020, up by 7% year on year.

October LLDPE imports into Russia reached 11,300 tonnes, compared to 10,700 tonnes a month earlier, local compounds producers increased their purchases in foreign markets. Overall LLPE imports totalled 129,500 tonnes in the first ten months of 2020, down by 12% year on year.

Last month's imports of other ethylene polymers, including ethylene-vinyl-acetate (EVA), were 10,100 tonnes, compared to 7,900 tonnes in September. Overall imports of other ethylene polymers reached 81,000 tonnes over the stated period versus 77,700 tonnes a year earlier.

MRC

Covestro broke ground of new Vulkollan production plant in Thailand

MOSCOW (MRC) -- Covestro announced that it has started construction of a new production plant for Vulkollan raw materials in the Map Ta Phut industrial zone in Thailand, according to GV.

The company said that with the new plant, it aims to satisfy the growing demand for high-performance polyurethane elastomers and to serve the ever wider range of applications of the product. The investment is in the high mid double-digit million euro range. Production at the new plant is scheduled to start at the end of 2022. It will employ a staff of more than 25 people.

"With this strategic investment, Covestro wants to further improve its infrastructure and customer proximity and strengthen its presence in the Asia-Pacific region," said Dr. Klaus Schafer, Chief Technology Officer (CTO) of Covestro. "After expanding our capacities for polycarbonate films, we are now broadening the production spectrum at our Map Ta Phut site with a new investment project."

"With this additional production line, we are not only supporting our customers' demand," said Michael Friede, Head of the Coatings, Adhesives, Specialties segment, "we are also investing in the future global growth of applications and industries with high-end requirements."

"Due to its extremely high mechanical strength and dynamic load capacity, the elastomer is the engineering material of choice for demanding applications," said Dr. Thomas Braig, Head of Elastomers. "In addition, its long-term functional reliability optimises the total cost of ownership compared to other elastomers. This makes Vulkollan the perfect material not only in the material handling industry, but also for a growing number of engineering applications."

According to Covestro, the product is one of the most powerful elastomers on the market. It is mainly used where highest mechanical strength and abrasion resistance is required. Examples are wheels for forklift trucks as well as couplings and seals for the engineering industry.

As MRC reported earlier, Covestro has closed the sale of its European polycarbonates (PC) sheets business to the Munich-based Serafin Group effective January 2, 2020. This includes key management and sales functions throughout Europe as well as production sites in Belgium and Italy.

According to MRC's ScanPlast report, Russia's estimated consumption of polycarbonate (PC) granules (excluding imports and exports to/from Belarus) rose in the first three quarters of 2020 by 32% year on year to 75,600 tonnes (57,200 tonnes a year earlier).

Covestro (formerly Bayer MaterialScience) is an independent subgroup within Bayer. It was created as part of the restructuring of Bayer AG from the former business group Bayer Polymers, with certain of its activities being spun off to Lanxess AG. Covestro manufactures and develops materials such as coatings, adhesives and sealants, polycarbonates (CDs, DVDs), polyurethanes (automotive seating, insulation for refrigerating appliances) etc. With 2019 sales of EUR12.4 billion, Covestro has 30 production sites worldwide and employs approximately 17,200 people (calculated as full-time equivalents) at the end of 2019.
MRC

Crude oil futures rise on vaccine momentum despite near-term pandemic concerns

MOSCOW (MRC) -- Crude oil futures ticked higher during mid-morning Asian trade Nov. 17 as reports of a highly effective Moderna vaccine carried the markets despite rising concerns over the number of COVID-19 infections and increased lockdown measures, reported S&P Global.

At 11:25 am Singapore time (0325 GMT), ICE Brent January crude futures were up 30 cents/b (0.68%) from the Nov. 16 settle to USD44.12/b, while the NYMEX December light sweet crude contract was up 24 cents/b (0.58%) at USD41.58/b.

Both ICE Brent January crude futures and WTI futures had jumped 2.43% and 3.02% on Nov. 16 to settle at USD43.82/b and USD41.34/b, respectively, as the market was lifted by a confluence of bullish developments, including the ratification of the Regional Comprehensive Economic Partnership, indications that the incoming Biden administration is reluctant to impose nationwide lockdowns and reports of a Moderna vaccine found to be almost 95% effective in preliminary trials.

Optimism over the Moderna vaccine continued to lift sentiment in early Asian trade, with ANZ analysts highlighting in a Nov. 17 note that it is likely to be easier to distribute than the Pfizer and BioNTech vaccine due to its long shelf-life and stability at refrigeration temperatures for up to 30 days.

Vandana Hari, chief executive officer of Vanda Insights, agreed in a discussion with S&P Global Platts on Nov. 17, saying: "The momentum from the preliminary success of the Moderna vaccine is carrying crude this morning", but added that sentiment was also supported by indications from the Joint Technical Committee meeting held on Nov. 16 that most members of the OPEC+ alliance are amenable to an extension of the current production cuts.

"The market is waiting for definitive statements from the Saudi or Russian energy ministers during the Nov. 17 Joint Ministerial Monitoring Committee meeting, but for the time being, an extension in output cuts is almost baked into the oil prices," Hari said.

Hari, however, added that given the recent price rally, it seems less likely that OPEC+ may deepen the production cuts, as was initially insinuated by Saudi energy minister Prince Abdulaziz bin Salman during the ADIPEC virtual conference on Nov. 9.

"It remains to be seen for exactly how long the alliance will extend the production cuts for, but it seems that it will steer clear of the option to deepen the cuts," Hari said.

Meanwhile, concerns over the near term development of the pandemic remained, with Austria entering into a nationwide lockdown Nov. 17 and other European countries mulling tighter restrictions amid burgeoning infection numbers.

ANZ analysts said: "(The lockdown restrictions are) weighing on demand for gasoline and distillate, which has had a close correlation with falling mobility data, presenting a difficult backdrop for the OPEC+ alliance."

As MRC informed previously, global oil demand may have already peaked, according to BP's latest long-term energy outlook, as the COVID-19 pandemic kicks the world economy onto a weaker growth trajectory and accelerates the shift to cleaner fuels.

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).

ccording to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,594,510 tonnes in the first nine months of 2020, up by 1% year on year. Only high denstiy polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market reached 880,130 tonnes in the nine months of 2020 (calculated using the formula: production minus exports plus imports, exluding producers' inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.
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