Croda completes acquisition of Iberchem

MOSCOW (MRC) -- Croda says it has completed the acquisition of the entire issued share capital of flavors and fragrances company Iberchem Group (Murcia, Spain) from investment company Eurazeo, said Chemweek.

It follows an announcement by Croda last week. Croda says it has agreed to acquire the entire issued share capital of flavors and fragrances company Iberchem Group (Murcia, Spain) from investment company Eurazeo for EUR820 million (USD975 million) on a debt-free, cash-free basis. The sum will be funded via a combination of Croda's existing debt facilities and the proceeds of a ?600-million (USD798 million) equity placing representing 8% of Croda's issued share capital, the company says. Acquiring Iberchem marks Croda's entry into the flavors and fragrances market. The transaction is expected to close by the end of 2020, Croda says.

The acquisition price represents a multiple of 20.5 times Iberchem's estimated 2020 EBITDA, according to Croda. “We have known Iberchem’s team for many years and their business is highly compatible with Croda’s. Iberchem stands out with its significant exposure to emerging markets, extensive product portfolio well placed to adapt to sustainability trends, strong customer focus and R&D capability, and 10-year track record of consistent year-on-year growth. By bringing our businesses together, we are creating a new, full-service offering to our customers in consumer-care markets and a compelling platform from which to grow the combined business in the years ahead,” says Steve Foots, CEO of Croda.

Eurazeo acquired 71.5% of Iberchem in 2017 for EUR405 million, less than half what Croda is paying for the business. Iberchem's management owns the rest of the company. Iberchem's sales have increased at a compound annual growth rate of 15% since 2010, Croda says.

As MRC informed earlier, Croda International (Goole, UK) says it has entered a partnership with Sentient Science (Buffalo, New York), an asset management and software services company, for the recommended use of Croda’s Rewitec additives for wind turbine gearboxes and main bearings.

As MRC informed earlier, Nexam Chemical has received an order from an existing customer in the area of PET additives for deliveries to the USA. The customer is a market-leading manufacturer of PET foam. It is the single largest order in the United States and also one of the largest ever for Nexam Chemical globally. Nexam Chemical has previously delivered products to this customer and this order confirms good growth in the business. The value of the order is SEK 9 million and applies to deliveries up to and including the spring of 2021.

We remind that Russia's output of chemical products rose in September 2020 by 6.7% year on year. At the same time, production of basic chemicals increased by 6.1% year on year in the first nine months of 2020, according to Rosstat's data. According to the Federal State Statistics Service of the Russian Federation, polymers in primary form accounted for the greatest increase in the January-September output. Last month's production of primary polymers decreased to 852,000 tonnes from 888,000 tonnes in August due to shutdowns in Tomsk, Ufa and Kazan. Overall output of polymers in primary form totalled 7,480,000 tonnes over the stated period, up by 16.4% year on year.

Croda acquired Rewitec in 2019 and began to offer to energy technology customers nano- and micro-particle-based additives to increase the durability of machinery by lowering friction and reducing wear, the company says. Prior to the acquisition in 2017, Sentient Science validated Rewitec’s DuraGear gearbox oil additives for use in wind turbine gearboxes, it says.
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US Commerce imposes preliminary cash deposits on Russia, Morocco phosphates

US Commerce imposes preliminary cash deposits on Russia, Morocco phosphates

MOSCOW (MRC) -- The US Department of Commerce has preliminarily found that phosphate fertilizer imports from Morocco and Russia benefit from countervailable subsidies. Commerce calculated a subsidy rate of 23.46% for Moroccan producer OCP, said Chemweek.

In the Russia investigation, Commerce calculated rates of 20.94% and 72.5% for PhosAgro and EuroChem, respectively, and 32.92% for all other producers/exporters. Preliminary cash deposits will be imposed within days, says the Mosaic Company (Tampa, Florida), which requested the investigation.

The US International Trade Commission will meanwhile investigate whether Moroccan and Russian phosphate fertilizer imports materially injure the US phosphate fertilizer industry. Its final determinations are scheduled to be issued by 25 March 2021.

Commerce, which announced the investigation on 17 July 2020, estimates phosphate fertilizer imports from Morocco in 2019 at USD729 million, and from Russia at USD299 million.

As MRC informed earlier, 1,985,000 tonnes of mineral fertilizers (in terms of 100% nutrients) were produced in October versus 2,014,000 tonnes a month earlier. Overall, Russian plants produced about 20,500,000 tonnes of fertilizers in January-October 2020, up by 3.5% year on year.

We remind, Russia's output of chemical products rose in October 2020 by 7.2% year on year. At the same time, production of basic chemicals grew in the first ten months of 2020 by 6.3% year on year. According to the Federal State Statistics Service of the Russian Federation, polymers in primary form accounted for the greatest increase in the January-October output.
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PetroVietnam says annual output unaffected by COVID-19 pandemic

MOSCOW (MRC) -- Vietnam's state oil firm PetroVietnam said it was on track to meet its targeted rate of production this year, despite the impact of the coronavirus pandemic and the fall in global crude oil prices, reported Reuters.

The company, formally known as Vietnam Oil and Gas Group, produced 18.12 million tons of crude oil and gas equivalent in the year to Nov. 15, meeting 89% of the yearly target set before the pandemic, it said in a statement.

It produced 10.2 million tons of refined petroleum products during the period, meeting 86.5% of its yearly target, the company added.

PetroVietnam is the largest contributor to Vietnam's state budget and often accounts for more than 10% of the Southeast Asian country's gross domestic product.

The company said it paid 61.7 trillion dong (USD2.66 billion) to the state budget in the period, without giving comparative figures.

As MRC informed before, in H1 October, 2020, two consortiums led by Hyundai Engineering & Construction and Technip Italy were bidding for a USD1.8 billion project to upgrade and expand Vietnam’s Dung Quat refinery. Binh Son Refining and Petrochemical said in a statement the project would raise the refinery’s capacity by 30% to 8.5 million tons of crude oil a year, or 170,000 barrels per day (bpd).

We remind that Binh Son Refinery and Petrochemical restarted the polypropylene (PP) plant at the beginning of October 2020 following a major maintenance shutdown. The 150,000 tons/year unit was taken off-stream on 12 August as the producer conducts overhaul at the upstream units.

According to MRC's ScanPlast report, 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, excluding producers' inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.
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EIA reports slight decline in weekly propane/propylene stocks

MOSCOW (MRC) -- US propane and propylene stocks fell 300,000 barrels (bbl) in the week ended 20 November to 92.6 million bbl, according to Chemweek with reference to the US Energy Information Administration's (EIA) statement Wednesday.

Nationwide stocks were down 0.4% on the week and were 4.2% above year-ago levels of 88.3 million bbl.

A 900,000 bbl build in the PADD 1 (East Coast) region, to 9 million bbl, partially offset declines in all other PADDs. PADD 3 (Gulf Coast) fell 400,000 bbl to 51.8 million bbl, PADD 2 (Midwest) dropped 600,000 bbl to 25.8 million bbl and PADDs 4 and 5 slid 300,000 bbl to 6.0 million bbl.

Exports of propane and propylene increased 99,000 b/d to 1.323 million bbl, while imports rose 24,000 b/d to 152,000 b/d.

Demand, as suggested by product supplied, fell 299,000 b/d to 1.171 million b/d. Refiner and blender net production of propane and propylene rose 15,000 b/d to 2.295 million b/d.

Following the report's release, bids and offers for Mont Belvieu TET (Lone Star) and non-TET (Enterprise) were both 54.375–54.75 cents/gal. That is not far off identical ranges of 54.5–54.75 cents/gal each grade traded ahead of the data.

Conway was last talked at 52.5–53 cents/gal, vs. a pre-EIA range of 52–52.75 cents/gal.

As MRC wrote before, Enterprise Products Partners LP (EPP), through one of its affiliates, has entered a long-term agreement with Marubeni Corp. of Japan, under which Marubeni will offtake polymer-grade propylene (PGP) produced from a second (PDH 2) plant currently under construction at EPP’s operations in Mont Belvieu, Tex., for supply to global customers. Concluded on June 16, the PGP offtake agreement is part of a long-term collaboration between EPP and Marubeni that also includes the export of liquefied ethylene, the first 25-million lb vessel of which loaded and sailed from EPP and Navigator Holdings Ltd.’s 50-50 joint venture marine terminal at Morgan’s Point, Tex., in early January, EPP and Marubeni said on June 30.

We remind that in July, 2020, Enterprise Products conducted maintenance at its propane dehydrogenation (PDH) unit in Mont Belvieu, Texas. This PDH unit has the capacity of 750,000 mt/y of propylene.

Propylene is the main feedstock for the production of polypropylene (PP).

According to MRC's ScanPlast report, 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, excluding producers' inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.
MRC

Indorama secures USD300 mln from IFC to raise recycling capacity

MOSCOW (MRC) -- The first-ever blue loan to a global plastic resin manufacturer will lead to the recycling of 50 billion PET (polyethylene terephthalate) bottles globally a year by 2025 including four countries in Asia and one in Latin America, diverting plastic waste from landfills and oceans, said Chemweek.

The landmark USD300 million financing package has been arranged by the International Finance Corporation (IFC), a member of the World Bank Group, for Indorama Ventures Global Services Limited (IVGS), a subsidiary of Indorama Ventures Public Company Limited (IVL), a leading global manufacturer and recycler of PET resin. The funding will help IVL increase its recycling capacity in Thailand, Indonesia, Philippines, India, and Brazil—countries which are grappling with mismanaged waste and serious plastic waste in the environment—and invest in renewable energy and resource efficiency projects. This marks IFC’s first blue loan exclusively focused on addressing marine plastic pollution. A Blue Loan is an innovative instrument whereby the funds raised are certified and tracked exclusively for projects that support a Blue Economy – i.e. sustainable use of ocean resources for economic growth, improved livelihoods and jobs, and ocean ecosystem health.

"We are honored to receive the first blue loan from IFC," said Yashovardhan Lohia, Chief Sustainability Officer, Indorama Ventures. “Our company, IVL, is building the recycling infrastructure needed to divert waste from the marine environment. By recycling post-consumer PET bottles into new bottles, we give waste an economic value. This drives improvements in waste collection systems, meaning less waste and cleaner oceans."

Indorama Ventures is aiming for a minimum of 750,000 metric tons of recycled PET (rPET) globally by 2025. A key feature of the investment is to create value out of waste—processing post-consumer PET bottles that would have ended up in landfill or been processed into lower-value products—by promoting higher-value bottle-to-bottle recycling which brings significant value generating potential.

"We are pleased to work with IVL, a global leader in PET manufacturing and recycling, to develop scalable solutions to one of the most pervasive and visible issues threatening life under water,” said Alfonso Garcia Mora, IFC Vice President for Asia and Pacific. “This blue loan complements IFC's ongoing work on a circular economy for plastics and enhanced waste management in Asia. It demonstrates that recycling can be an effective intervention to address plastic waste while supporting our overall sustainability and climate change agenda."

Besides helping IVL increase its recycling capacities in five countries, the loan will also help the company invest in other climate-related activities. IVL will install more solar panels at facilities in Thailand and India with other sites to follow, while also securing more renewable energy for its manufacturing facilities. With IFC financing, IVL is working on a Waste Heat Recovery (WHR) project at its PET and fiber manufacturing facility in Indonesia where energy efficiency (EE) measures are expected to reduce the facility’s carbon footprint by as much as 25 percent. In addition to developing innovative WHR projects, IVL will be developing EE projects in Brazil and other manufacturing facilities to meet its corporate targets.

IFC’s financing package comprises a USD150 million senior loan from IFC and parallel loans of USD150 million from the Asian Development Bank (ADB) and Deutsche Investitions-und Entwicklungsgesellschaft (DEG). IFC is also working closely with the World Bank to leverage public-private sector collaboration and develop policies and investments critical to systematically address the complex marine plastic pollution problem.

As MRC informed earlier, Indorama Ventures Sines, a subsidiary of the world leader in the production of polyethylene terephthalate (PET) - Indorama Ventures Company Ltd (IVL), plans to halt production at the refined terephthalic acid (TPA) plant in Sines (Sines, Portugal) in mid-November to conduct planned preventive measures. Repair work at this enterprise with a capacity of 700,000 tonnes/year of TPA per year will continue for one month. Thus, this plant should return to work in mid-December this year.

As per ICIS-MRC Price Report, buying activity has improved in the Russian market of PET chips this week. Most producers reported a limited volume of free PET in the spot market. Converters' opinions regarding November demand in the preforms market differed. Some of them reported good sales, while others reported that demand was low and they have to sell preforms at a price close to their cost.

Indorama Ventures Public Company Limited, listed in Thailand (Bloomberg ticker IVL.TB), is one of the world’s leading petrochemicals producers, with a global manufacturing footprint across Africa, Asia Pacific, Europe and Americas. The company’s portfolio comprises Integrated PET, Olefins, Fibers, Packaging and Specialty Chemicals. Indorama Ventures products serve major FMCG and automotive sectors, i.e. beverages, hygiene, personal care, tire and safety segments. Indorama Ventures has approx. 24,000 employees worldwide and consolidated revenue of US$ 11.4 billion in 2019. The Company is listed in the Dow Jones Emerging Markets and World Sustainability Indices (DJSI).
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