Global chemicals output climbs for sixth month

MOSCOW (MRC) -- Data collected and tabulated by the American Chemistry Council (ACC) show that global chemicals production rose 1.9% in November, up from 1.7% in October and extending the recovery that began in June. During November, chemical production grew in all regions except the Former Soviet Union (FSU), said Hydrocarbonprocessing.

Headline global production was up 3.7% year-over-year (Y/Y) on a three-month moving average (3MMA) basis and is now 2.9% above the pre-COVID peak last December. Global output stood at 122.0 percent of its average 2012 levels.

During November, global capacity rose 0.1% and was up 2.2% Y/Y. With improving production, capacity utilization in the global chemical industry rose 1.5 points to 82.9%. This is up from 81.7% in October and the pre-COVID peak in December 2019, but below the long-term (1987-2017) average of 86.5%.

Among chemical industry segments, November results were positive, with gains across all segments. Considering year-earlier comparisons, growth was mixed, with gains in plastic resins, synthetic rubber, manufactured fibers, bulk petrochemicals and organics, inorganic chemicals, other specialties, agricultural chemicals, and consumer products, but contraction in coatings.

ACC’s Global Chemical Production Regional Index (Global CPRI) measures the production volume of the chemical industry for 33 key nations, sub-regions, and regions, all aggregated to the world total. The index is comparable to the Federal Reserve Board (FRB) production indices and features a similar base year where 2012=100. This index is developed from government industrial production indices for chemicals from more than 65 nations accounting for about 98% of the total global chemical industry. This data set is the only timely source of market trends for the global chemical industry and is comparable to the U.S. CPRI data, a timely source of U.S. regional chemical production.

We remind that Russia's output of chemical products rose in November 2020 by 9.5% year on year. At the same time, production of basic chemicals increased in the first eleven months of 2020 by 6.6% year on year, 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-November 2020 output. November production of polymers in primary form rose to 896,000 tonnes from 852,000 tonnes in October. Overall output of polymers in primary form totalled 9,240,000 tonnes over the stated period, up by 17.1% year on year.
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MOSCOW (MRC) -- Total and Engie (Paris, France) will cooperate in developing, building, and operating green hydrogen production and storage facilities at the 500,000-metric tons/year La Mede biorefinery at Chateauneuf-les-Martigues, France, to create supplies for biofuel output, reported Chemweek with reference to the companiies' joint statement.

Subject to funding and relevant permits, the partners plan to erect a 40-megawatt (MW) electrolyzer at the refining site by 2024 that would initially produce 5 metric tons/day of green hydrogen, powered from solar farms with a combined capacity of more than 100 MW.

First-stage production could avoid 15,000 metric tons/year of carbon dioxide emissions, they estimate. The development of additional renewable power farms could lift hydrogen output later to 15 metric tons/day, utilizing the full capacity of the electrolyzer.

The carbon-free hydrogen would be used to produce renewable biodiesel at the La Mede biofuel refinery, which turns vegetable oil - such as canola, palm, sunflower - and treated waste - animal fats, cooking oil, residues - into hydrotreated vegetable oil. The rest would be sold to external users.

If built, the Masshylia project at Chateauneuf-les-Martigues could become France's largest site for hydrogen from renewable power, based on a concept that is "internationally reproducible," according to the statement.

The partners are seeking subsidies at the national and EU levels. They responded to a call for an expression of interest from the French authorities and are aiming to secure EU funding within the Important Projects of Common European Interest (IPCEI) framework, which allows state aid, and through the Innovation Fund. France is among the countries that signed up to the cross-border IPCEI on Hydrogen Technologies and Systems initiative.

Total and Engie's aim is to overcome the renewables intermittency challenge by integrating several balancing solutions, to be able to produce a continuous stream of hydrogen supply. These include hydrogen storage to balance intermittent power production and hydrogen consumption, a digital piloting system, and supplies from several photovoltaic farms, directly linked to the electrolyzer.

Power-to-X developer CWP Renewables recently called access to inexpensive hydrogen storage a "game changer," because it allows to "time-shift" renewable power for release at a later stage. By comparison, storage with batteries is too costly, managing partner Dimitar Enchev said at the video-streamed World PtX Summit in early December 2020.

OPIS is an IHS Markit company.

As MRC wrote earlier, within the framework of its net zero strategy, Total will convert its Grandpuits refinery (Seine-et-Marne) into a zero-crude platform and will invest more then EUR500 mln into this project. By 2024 the platform will focus on four new industrial activities: production of renewable diesel primarily intended for the aviation industry, production of bioplastics, plastics recycling and operation of two photovoltaic solar power plants.

We remind that in November 2019, Total disclosed that itis evaluating construction of a new gas cracker at its Deasan, South Korea, joint venture (JV) with Hanwha Chemical.

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

According to MRC's DataScope report, PE imports to Russia decreased in January-November 2020 by 17% year on year and reached 569,900 tonnes. High density polyethylene (HDPE) accounted for the greatest reduction in imports. At the same time, PP imports into Russia increased by 21% year on year to about 202,000 tonnes in the first eleven months of 2020. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.

Total S.A. is a French multinational oil and gas company and one of the six "Supermajor" oil companies in the world with business in Europe, the United States, the Middle East and Asia. The company's petrochemical products cover two main groups: base chemicals and the consumer polymers (polyethylene, polypropylene and polystyrene) that are derived from them.
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MOSCOW (MRC) -- Borealis and TOMRA have announced the operational start of their advanced mechanical recycling demo plant in Lahnstein, Germany, the result of a partnership that marries chemistry with technology for unsurpassed results, as per Borealis' press release.

“This plant embodies the principles of the platform founded by Borealis, which seeks to innovate plastics circularity through collaboration,” says Lucrece Foufopoulos, Borealis Executive Vice President Polyolefins, Innovation & Technology and Circular Economy Solutions. “Offering brand owners and converters top quality recycled material, suitable for use in highly demanding applications is Borealis’ latest contribution to a more circular economy of plastics. Life demands progress, and through collaboration we re-invent for more sustainable living.”

The state-of-the-art plant processes both rigid and flexible plastic waste from households. And unlike many current recycling plants, it will produce the advanced solutions necessary for use in high-demanding plastic applications in various industries, including automotive and consumer products. With high purity, low odour, high product consistency and light colour fractions, these grade recycled polymers will meet customer quality requirements across the value chain.

The purpose of this demo plant is to generate material for brand owners and converters to qualify, validate and prove fit for use in their highly demanding applications. Technical success will set the groundwork for a commercial-scale advanced recycling plant.

“This plant is just the beginning of what’s possible when key players in the value chain come together to make a truly significant impact in the market,” says Volker Rehrmann, Executive Vice President and Head of Circular Economy at TOMRA. “Having just launched the new Circular Economy Division, it is clear what a large role waste management and pivotal projects like this have on moving towards a sustainable future. We are proud to have initiated one of the most advanced mechanical recycling plants when it comes to post-consumer polymer waste. This will become an important enabler as we accelerate the transformation to a circular economy in the years to come, and we are excited to be a part of this pioneering project.”

Operation of the plant is a joint enterprise between Borealis, TOMRA and Zimmermann. Borealis is responsible for the plant’s commercial success and contributes its expertise and knowledge in innovation, recycling and compounding. Likewise, TOMRA contributes as a provider of technology-led solutions and brings its proven expertise, established process and market knowledge, which, in turn, enable the circular economy through advanced collection and sorting systems. Zimmermann is a waste management company with experience in sorting multiple types of waste, including plastics, and is responsible for successful plant operations and product quality.

“At P&G we are making packaging with the ‘next life’ in mind to help drive a more robust circular economy. We must increase the supply of high quality recycled plastic to enable the industry to deliver on this vision,” says Gian De Belder, Procter & Gamble (P&G) Technical Director, R&D Packaging Sustainability. “The innovative new approach that Borealis is taking shows potential to step-change both the quantity and quality of PCR available for our brands, and help us to achieve our 2030 goal to reduce our use of virgin plastic in packaging by 50%, or 300 kilotonnes annually. Early tests of the material looks very promising!”

“One major challenge towards more circular packaging is the availability of high-quality recycled plastics that can be used in the packaging of our brands,” comments Thorsten Leopold, Director International Packaging Technology Home Care at Henkel. “We are, therefore, very excited that this project brings together three proven experts along the value chain with the ambition to lift mechanical recycling to a new level.”

As MRC reported before, the start-up of the 625,000-metric tons/year steam cracker operated by Borealis at Stenungsund, Sweden, is now "in process," but the declaration of force majeure remains in place. "The force majeure on our cracker is still in place. Start-up of the cracker is in process, however this is a complex procedure that needs time," Borealis said in an emailed statement to OPIS. Restarting the cracker could take several weeks, according to Matthew Thoelke, research and analysis director/global olefins at IHS Markit.

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

According to MRC's DataScope report, PE imports to Russia decreased in January-November 2020 by 17% year on year and reached 569,900 tonnes. High density polyethylene (HDPE) accounted for the greatest reduction in imports. At the same time, PP imports into Russia increased by 21% year on year to about 202,000 tonnes in the first eleven months of 2020. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.

Borealis is a leading provider of innovative solutions in the fields of polyolefins, base chemicals and fertilizers. With headquarters in Vienna, Austria, Borealis currently employs around 6,500 and operates in over 120 countries.
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1. IEA says oil market outlook clouded by vaccine roll-out variables

MOSCOW (MRC) -- Oil producers face an unprecedented challenge to balance supply and demand as factors including the pace and response to COVID-19 vaccines cloud the outlook, reported Reuters with reference to an official with International Energy Agency's (IEA) statement. "Producers are grappling with huge uncertainty about where this goes from here," Tim Gould, head of energy supply outlooks and investment, told the Gulf Intelligence forum. "That's not just in terms of economic recovery but indicators we wouldn't necessarily normally be looking at: (such as the) levels of trust in different countries about vaccines."



MRC

MOSCOW (MRC) -- The January contract price of ethylene was settled in Europe up by EUR65/tonne from the previous month. However, all European producers announced a much greater increase in export polyethylene (PE) prices for January shipments to the CIS markets, than the rise of monomer prices, according to ICIS-MRC Price report.

Negotiations over January prices of European PE began in the first days of the month. All market participants said European producers significantly raised their export prices of ethylene polymers. Moreover, some producers adjusted their export prices twice in the first two weeks of January. In some cases, the price increase was EUR100/tonne, and in other cases, the price rise reached EUR170/tonne and higher.

It is also worth noting that all European producers have major export restrictions, and some producers do not even plan to sell PE to the CIS countries this month.

Deals for January shipments of high density polyethylene (HDPE) were done in the range EUR950-1,030/tonne FCA, whereas last month's deals were done at EUR850-925/tonne FCA. Deals for low density polyethylene (LDPE) were done in the range of EUR1,140-1,200/tonne FCA, versus EUR970-1,020/tonne FCA a month earlier.

The situation with Middle Eastern PE was similar, local producers also raised their export prices under the pressure of higher crude oil prices and strong demand. Quotas for shipments to the CIS markets were reduced noticeably in comparison with December. Prices of Middle Eastern PE were also affected by an additional pressure from the rising sea freight.

Deals for January shipments of Middle Eastern HDPE were done in the range of USD1,120-1,180/tonne CIF. Offer prices for butene linear low density polyethylene (LLDPE С4) reached USD1,220/tonne CIF.
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