Braskem partially resumes production at its unit in Mexico

MOSCOW (MRC) -- Brazilian petrochemicals producer Braskem reported in a document sent to the regulator that its Mexican unit, Braskem Idesa, partially resumed polyethylene production under the terms of an "experimental business model", reported CA Posts.

Braskem Idesa partially halted production last month following an interruption in natural gas supplies, after the federal government decided not to renew the ethane supply contract with the company. The outage caused the total suspension of the processes of its Ethylene XXI plant. The group said it will take legal action to defend its rights but that it cannot predict when the Mexican unit will be fully operational, given the uncertainty related to its gas supplies.

Since taking office at the end of 2018, the administration headed by Lopez Obrador has canceled or asked to review millionaire energy contracts , a policy that has generated concern among the main investment partners in the country, such as the United States, the European Union and Canada. In the case of Braskem Idesa, the national oil company Pemex accumulated millionaire penalties for failing to comply with the supply of natural gas to the Ethylene XXI petrochemical complex.

As MRC wrote before, Brazil’s state-run oil company Petrobras is seeking 800 million reais (USD152 million) in compensation from engineering group Odebrecht in arbitration proceedings over its alleged violation of the shareholders agreement in petrochemical company Braskem. Odebrecht is seeking to sell its 38.3% stake in Braskem SA, while Petrobras aims to offload its 36.1% stake.

We remind that Braskem is no longer pursuing a petrochemical project, which would have included an ethane cracker, in West Virginia. And the company is seeking to sell the land that would have housed the cracker. The project, announced in 2013, had been on Braskem's back burner for several years.

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.

Headquartered in Rio de Janeiro, Petrobras is an integrated energy firm. Petrobras' activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks as well as refining, processing, trade and transport of oil and oil products, natural gas and other fluid hydrocarbons, in addition to other energy-related activities.
MRC

MRC team wishes Merry Christmas and Happy New Year!

MOSCOW (MRC) -- Dear readers of MRC!

We congratulate you on Christmas and New Year!

We wish you every happiness this Holiday season and throughout the coming year.

All of MRC staff join in saying "thank you" and wishing you a happy holiday and prosperous new year.

On this special day, we wish you happiness, prosperity and success, hoping that we continue our association through many more wonderful years ahead!

Best wishes,

MRC staff.

MRC

Cangzhou Dahua starts up new PC plant in China

MOSCOW (MRC) -- China's Cangzhou Dahua New Material has announced that it has started up its new polycarbonate (PC) plant at Cangzhou in Hebei province, according to Equalocean.

The new facility can produce 100,000 mt/year of PC. The company has already achieved on-spec production at this plant.

The project will help to improve Cangzhou Dahua's advantages and competitiveness, as per the company's statement.

Construction of the new PC plant began in early 2019.

As MRC reported earlier, the total investment for the plant is estimated at CNY2.1bn (US298m), although initially it was planes at CNY1.6bn.

According to MRC's ScanPlast report, Russia's estimated consumption of PC granules (excluding imports and exports to\\from Belarus) rose in January-November 2020 by 18% year on year to 83,600 tonnes (70,600 tonnes a year earlier).
MRC

Sabic requests term limit for Clariant board members

MOSCOW (MRC) -- Clariant’s biggest shareholder, Saudi Basic Industries Corporation, on Monday re-ignited a battle over the Swiss chemicals maker’s future by seeking a 12-year board member term limit that would force Chairman Hariolf Kottmann’s ouster, said Reuters.

SABIC, which owns 31.5% of Clariant, asked for the new term limit, including for the chairperson, to be added to the agenda of the annual general meeting of shareholders scheduled for April 7. Aramco-controlled SABIC also proposed a special dividend distribution of 2 Swiss francs per share, Clariant said in a statement, which would total roughly 670 million francs (USD753 million).

That could drain the company’s coffers that new CEO Conrad Keijzer might otherwise use to bulk up via acquisitions that he has said are a priority. Kottmann, who became CEO and joined Clariant’s board in 2008, has been at odds with SABIC since a proposed joint venture between the two companies collapsed in 2019 over disagreements over the price of the Saudi Arabian company’s assets.

The sudden departure of Ernesto Ochiello, a longtime SABIC executive who quit as Clariant CEO in July 2019 after less than a year in the job, further signalled differences between Kottmann and his top shareholder.

Ochiello returned to SABIC after leaving Clariant. A Clariant spokesman said the Swiss company and SABIC continued to have a “professional relationship”, and the Saudi company remained an important customer. He said Clariant’s board would discuss SABIC’s proposals at an upcoming meeting.

Clariant, which is selling its pigments unit and cutting 1,000 jobs amid plans to dispose of divisions that make up two-thirds of annual sales, confirmed adoption of the term limits at the shareholders meeting would force Kottmann out, though other board members have several years before they would be affected.

As MRC informed earlier, Sabic intends to raise the prices of acrylonitrile butadiene styrene (ABS) and polycarbonate (PC) in the United States from January 11. The company increases the prices of LEXAN PC by 20 cents per kg (USD198 per ton), PC compound and CYCOLOY ABS by 20 cents per kg (USD198 per ton), CYCOLAC ABS by 20 cents per kg (USD198 per ton), PC GELOY ASA at 20 cents per kg (USD198 per tonne).

According to MRC's ScanPlast report, Russia's estimated consumption of PC granules (excluding imports and exports to\\from Belarus) rose in January-November 2020 by 18% year on year to 83,600 tonnes (70,600 tonnes a year earlier).

The Saudi Basic Industries Corp (SABIC), established in 1976, is a diversified company manufacturing chemicals and intermediates, industrial polymers, fertilizers and metals. Today SABIC is the largest industrial concern in the Persian Gulf, producing about 10% of all world petrochemical products. The state owns 70% of the share capital of SABIC.
MRC

Russian LDPE market: 2020 year results

MOSCOW (MRC) -- Demand for low density polyethylene (LDPE) subsided in Russia in 2020 by 2% after an increase a year earlier. At the same time, prices have reached a record level over the past five years and continued to rise, according to ICIS-MRC Price report.
Quarantine restrictions in April-May led to a significant reduction in demand for LDPE in Russia, despite seasonal factors. But already from mid-summer, processing volumes began to recover dynamically and remained at a good level until the end of the year. However, according to preliminary results, demand for LDPE showed a negative result in 2020. At the same time, the dynamically growing polyethylene (PE) prices in Asia have begun to put a major pressure on prices in the Russian market for the past two months of the year, and already in December, prices of Russian LDPE exceeded Rb100,000/tonne.


Russian producers failed to maintain last year's LDPE production figures. LDPE output totalled 574,600 tonnes in the first eleven months of 2020, down by 2% year on year. And lower PE production was largely due to the increase in the time of shutdowns for repairs at some plants.

Exports grew only by 1% to 171,700 tonnes. At the same time, export volumes were quite high in the first quarter, after which Russian producers reduced their sales to foreign markets. Higher exports was also registered in the past two years because of high prices in Asia.

LDPE imports to the Russian market increased. Overall PE imports exceeded 103,400 tonnes in January-November 2020, up by 5% year on year. At the same time, imports grew from both Belarus and Europe.

Thus, demand for LDPE was 506,320 tonnes in the first eleven months of 2020 versus 514,500 tonnes a year earlier.

All five producers shut their production capacities for scheduled maintenances this year. Traditionally, Angarsk Polymers Plant and Gazprom neftekhim Salavat shut their production in July-August. For a number of reasons, Kazanorgsintez took off-stream its production capacities twice this year: in April-May and September-October.

LDPE prices reached their lowest level in the second half of May-early June, and prices of some grades fell below Rb70,000/tonne CPT Moscow, including VAT. But already in the second half of the first month of summer, PE prices began to go up, which was due to the upcoming shutdowns for turnarounds at plants in Angarsk and Salavat. In September, LDPE prices exceeded Rb100,000/tonne CPT Moscow, including VAT, and after a slight decrease in October, prices resumed their upward trend in November under the pressure of the dynamic price growth in Asia.

Thus, December LDPE prices exceeded Rb102,000/tonne CPT Moscow, including VAT, breaking the 2016 year record. And some producers have already announced a further increase in January LDPE prices.

MRC