LLDPE prices in Russia rise in November under pressure of situation in foreign markets

MOSCOW (MRC) -- Many Russian converters expected cuts in December low density polyethylene (LDPE) prices under the pressure from seasonal factors. But the situation in foreign markets led to the opposite effect, polyethylene (PE) prices went up in the last month of autumn, according to ICIS-MRC Price report.

By mid-October, a series of shutdowns for maintenance at Russian LDPE plants had come to an end. Some converters said the increased supply from domestic producers and a seasonal drop in demand for finished products should have led to lower LDPE prices, as it was the case in the previous years. But the situation in foreign markets has been unfolding exactly the opposite. High prices in Asia allowed Russian producers to export PE at higher prices than prices in the domestic market. And, as a result, domestic LDPE prices were moving up to the export level.

In the third decade of August-the first half of October, three Russian producers simultaneously shut their production capacities for repairs: Ufaorgsintez, Tomskneftekhim and Kazanorgsintez. Outages of the key producers led to a shortage of LDPE in the market and a price rise. By the second half of October, the last shutdowns for turnarounds in Ufa and Kazan were finished, which should have led to an increase in supply of PE in the market.

But there was still no oversupply of LDPE in November. Kazanorgsintez operated with incomplete capacity utilisation during the month, there were also restrictions on capacity utilisation at some of Ufaorgsintez's production capacities, and the Angarsk Polymers Plant shut its production for several days because of technical issues.

Demand for LDPE has been strong as for November since the beginning of the month, however, this was mostly typical for polyethylene (PE) at its lower price range. And by the middle of the month, many small-size sellers said they had sold out all their monthly quantities. PE prices have begun to go up gradually since the middle of the month, and in some cases, prices of 108 grade LDPE have reached Rb98,000/tonne CPT Moscow, including VAT, by late November, whereas by end-November 2019, prices of this PE grade had dropped below Rb80,000/tonne CPT Moscow, including VAT.

In Asia, LDPE prices has been dynamically rising since mid-summer, and last week's prices in China exceeded USD1,230/tonne CFR. On the back of this, some Russian producers reporter good export contracts, and deals were done in the range of USD1,100-1,170/tonne FCA, which even with the current strengthening of the rouble exchange rate, including taxes, exceeded Rb100,000/tonne FCA, including VAT.

Good export contracts allowed Russian producers to speak about a proportional increase in LDPE prices in the domestic market. This week, Tomskneftekhim virtually already announced a rise of Rb4,000/tonne in spot December prices.
MRC

MOSCOW (MRC) -- Iranian President Hassan Rouhani on Thursday inaugurated Lordegan Petrochemical Company in the southwest of the country, according to XINHUANet.

The plant, which is located in Chaharmahal and Bakhtiari province, has the capacity to produce 677,000 tons of ammonia and 1,075 tons of urea annually.

Rouhani said during the opening ceremony that the products of the facility will be exported and Iran is ready to supply the international market at lower prices, official IRNA news agency reported.

He also welcomed foreign investments in the country's development projects.

According to Tasnim news agency, 800 million U.S. dollars has been invested in the plant so far.

As MRC reported earlier, Iran will launch 42 petrochemical projects by the end of next year.

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

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

MOSCOW (MRC) -- KT - Kinetics Technology, a subsidiary of Maire Tecnimont S.p.A., has been awarded an EP contract by a global engineering and construction company, consisting in the detailed engineering, procurement and delivery of three, large-scale Delayed Coker Furnaces, to be installed in a new oil refinery in Mexico, said Hydrocarbonprocessing.

The three massive coking furnaces will be delivered fully modularized and ready for site installation, and once completed, will represent one of the world’s largest delayed coking units.

With this new achievement, KT strengthens its track record in refining and confirms its capabilities in supplying highly complex equipment, through the implementation of state-of-the-art technologies and modularization methodologies.

Pierroberto Folgiero, Maire Tecnimont Group CEO, commented: "These awards further consolidate Maire Tecnimont’s positioning in its core business and provide sound evidence of the resilience of our technology-driven development strategy, despite Covid-19 times".

As MRC informed earlier, Maire Tecnimont S.P.A. and Hera Group signed of a strategic agreement between Aliplast, Hera Group’s subsidiary, for the collection, recycling and conversion of plastics, and NextChem, Maire Tecnimont Group’s company, for the development of projects and technologies for the energy transition.

As MRC informed earlier, Maire Tecnimont S.p.A. signed a EUR1.2 billion contract for engineering, procurement and on-site services (EPSS) for the planned Amur Gas Chemical Complex (Amur Gas Chemical Complex) of SIBUR, the largest petrochemical holding in Russia and Eastern Europe. The agreement was signed with the Amurskiy GCC, a subsidiary of SIBUR.

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

According 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.

Maire Tecnimont S.p.A., a company listed on the Milan Stock Exchange, leading an international industrial group which is a leader in the transformation of natural resources (plant engineering in downstream oil & gas, with technological and execution competences). Through its subsidiary NextChem it operates in the field of green chemistry and the technologies to support the energy transition. Maire Tecnimont Group operates in about 45 countries, through 50 operative companies and a workforce of approximately 6,300 employees, along with approximately 3,000 professionals in the electro-instrumental division.
MRC

MOSCOW (MRC) -- Wacker will support production of CureVac’s COVID-19 mRNA-based vaccine candidate at its biotech site in Amsterdam, with production scheduled to start in the first half of 2021, as per BioPharm.

On Nov. 23, 2020, biopharmaceutical company CureVac and contract development and manufacturing organization Wacker Chemie jointly announced that they have signed a contract for the manufacture of CureVac’s COVID-19 mRNA-based vaccine candidate, CVnCoV. Under terms of the initial agreement, Wacker will ramp up good manufacturing practice (GMP) production of the mRNA drug substance for the vaccine at its biotech site in Amsterdam in the first half of 2021.

Preparations for the start of production, technology transfers, and test runs are already underway, the companies reported in a press release. Wacker plans to produce more than 100 million doses of the CureVac vaccine per year at its Amsterdam site. The site can also be further expanded to meet rising demand in the future.

The Amsterdam site has a history of producing vaccines for clinical development and commercial supply, with a portfolio that ranges from conventional live and killed vaccines to protein-based, polysaccharide and glycoconjugate vaccines. Wacker has invested in the site in recent months to extend production to include mRNA-based vaccines.

As MRC reported earlier, Wacker Chemie operates a 90 ktpa EVA compounding plant at the Ulsan site, consisting of two lines. The second line with a capacity of 40 thousand tons of products per year was launched in 2013.

According to MRC's DataScope, September EVA imports to Russia fell by 30,32% year on year to 2,38 tonnes from 3,420 tonnes a year earlier, and overall imports of this grade of ethylene copolymer into the Russian Federation dropped in January-September 2020 by 9,85% year on year to 26,340 tonnes (29,220 tonnes a year earlier).

Wacker Chemie manufactures and markets EVA dispersions under the VINNAPAS brand name. VINNAPAS polymer dispersions are used in a wide range of industries: for the production of complex thermal insulation systems, building and tile adhesives, plaster, building mixtures and mortars, cement sealing slurries and nonwovens.
MRC

MOSCOW (MRC) -- Sinopec has established strategic cooperation with three top institutions in Beijing, China, to take lead in a joint research on the energy and chemical industry’s carbon emissions peak and carbon neutrality, said Chemweek.

Sinopec invited thought leaders and experts in the fields of climate change, energy and chemical industry to conduct in-depth research on the strategic path of having CO2 emissions peak and achieve carbon neutrality before 2030 following China’s action plan.

Zhang Yuzhuo, a research fellow and academician of the Chinese Academy of Engineering and chairman of the board of Sinopec, noted that achieving the goal of reaching the CO2 emissions peak and going carbon neutral is both a great responsibility and profound revolution for the energy and chemical industry.

“Sinopec will focus on green and low-carbon development from a strategic and overall perspective and move towards the goal of achieving ‘net-zero’ unswervingly, the company will follow the trends of global energy reform and general industrial development to study and determine its own strategic goals, key tasks, implementation approaches and guarantee mechanism,” said Zhang. “Sinopec will also strengthen the communication and exchanges with government departments and industry associations to better serve and support national and industry-related decisions.”

In recent years, Sinopec has promoted its green and low-carbon development tactic for the corporate development strategy, actively control its greenhouse gas emissions to achieve significant carbon emissions results. In the area of clean energy development, Sinopec has expanded its construction of natural gas production capacity and promoted the development of new energy resources such as biomass energy and geothermal energy, while driving forward the development and utilization of hydrogen energy.

To strengthen the company’s energy-saving management, Sinopec implements an “energy efficiency improvement” plan that accelerates industrial structure adjustment to phase out the outdated production capacity.

And in terms of greenhouse gas recovery and utilization, Sinopec is focusing on promoting the recovery and utilization of high-concentration CO2 tail gas from refining and chemical enterprises, carrying out CO2 flooding field tests and methane gas release recovery. The carbon trading transaction volume of enterprises participating in the pilot project has reached 11.1 million tons.

As MRC informed before, in H1 October, 2020, China's Sinopec started operation of a 800,000 tons-per-year ethylene facility at its Zhanjiang refinery. The refinery, located in the southern Chinese coastal city of Zhanjiang, commenced operation of its 200,000 barrel per day crude oil refining units in June.

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.

China Petrochemical Corporation (Sinopec Group) is a super-large petroleum and petrochemical enterprise group established in July 1998 on the basis of the former China Petrochemical Corporation. Sinopec Group"s key business activities include the exploration and production of oil and natural gas, petrochemicals and other chemical products, oil refining.
MRC