Lanxess lifts force majeure on caprolactam, nylon-6 supplies in Germany, Belgium

MOSCOW (MRC) -- Lanxess has lifted a force majeure declared on supplies of certain polymer-based compounds, caprolactam, and other materials from its sites in Germany and Belgium following technical issues last year, according to Chemweek.

The company lifted force majeure on supplies of nylon-6 copolymer-based compounds and film materials produced at its Krefeld-Uerdingen site in Germany, and on supplies of caprolactam produced at its plant in Antwerp, Belgium, the producer told its customers in a letter on 18 February.

“With our letters dated 30 October and 22 December 2020, we regretfully had to inform you about technical defects in our caprolactam plant in Antwerp and a reactor in Uerdingen, which made it necessary to shut down both plants,” the producer said in the letter. The force majeure for the EAME region has now been lifted “with immediate effect” for its caprolactam and Durethan-brand compounds, and nylon-6 copolymer-based Durethan-brand compounds and films, it said.

The 220,000-metric tons/year caprolactam plant in Antwerp and the Uerdingen site are both operating at “normal production levels,” it added. The Krefeld-Uerdingen site has a nameplate capacity to produce 120,000 metric tons/year of nylon-6.

Lanxess has, however, warned customers of potential shortages due to raw material and logistical constraints. “The demand in the market is extraordinarily high and, due to the force majeure, we are still in the process to rebuild our inventory levels. In consequence, we can hardly offer any additional quantities in all our product groups,” it said.

The European nylon-6 market is typically structurally long, according to Prem Chitkara, director/nylon and polyester fibers EMEA at IHS Markit. “However, [the market] has been experiencing a somewhat tight situation since the fourth quarter of 2020 due to extremely healthy demand from automotive, film packaging, and electrical and electronics components,” he says. “The removal of Lanxess’s force majeure will bring some relief sentiment to the current tight market."

Caprolactam is used to produce nylon-6 resins, used in various applications such as fibers and film materials. Nylon-6 copolymer-based compounds are used in the production of automotive parts and electrical and electronic components.

As per MRC, specialty chemicals company Lanxess expanded its capacity for black synthetic iron oxide pigments at its Krefeld-Uerdingen site by more than 5,000 metric tons per year. “The increased demand from the construction industry, in particular for our unique black pigments to color concrete, can be even better met with the debottlenecking measures that have now been completed,” says Holger Huppeler, head of the Inorganic Pigments business unit at Lanxess. The company is thus continuing the systematic expansion of its production capacities for synthetic iron oxide pigments. Lanxess is the only supplier worldwide to produce these pigments using the Laux process.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,760,950 tonnes in the first ten months of 2020, up by 3% year on year. Only high density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments increased. At the same time, PP shipments to the Russian market reached 978,870 tonnes in January-October 2020 (calculated using the formula: production minus exports plus imports minus producers" inventories as of 1 January, 2020). Supply of exclusively of PP random copolymer increased.
MRC

MOSCOW (MRC) -- SUEZ signed a contract for a large wastewater treatment project and has been awarded an associated 10-year service agreement with Irkutsk Polymer Plant of Irkutsk Oil Company, one of the largest independent oil and gas producers located in Russia building a new, modern polymer plant in the Eastern Siberia region of the country, said Hydrocarbonprocessing.

Through its Water Technologies & Solutions business, SUEZ will supply critical water technology for the new plant and will guarantee performance and membrane replacements for the duration of the service agreement.

Selected for its experience with similar projects in Russia that face harsh weather conditions and winter temperatures consistently well below freezing, SUEZ will treat all wastewater from the new plant using 3 main technologies; membrane bioreactor (MBR), electrodialysis reversal (EDR) and thermal vapor recompression (TVR). The combination of technologies will enable the plant to reach near-zero liquid discharge and implement water reuse, thereby limiting the plant’s impact on the local environment.

"This project demonstrates the value of our broad portfolio and how the right combination of advanced technologies can help a customer reach their unique goals,” said Kevin Cassidy, executive vice president engineered systems for SUEZ – Water Technologies & Solutions. “Because of our global expertise and local experience, we have the honor to help Irkutsk Polymer Plant reuse up to 98% of their wastewater."

For the remaining effluent stream, the treatment process will enable the Irkutsk Polymer Plant to meet strict government regulations for discharge, including the fishery body standards of the Russian Federation for discharged water, which are among the strictest on the globe. Once commissioned, the wastewater treatment plant will treat a total maximum design flow of 400 m3/hr. The plant is expected to be commissioned in 2024.

"During the construction and further operation of the plant, advanced technologies and equipment from the world's leading manufacturers will be involved,” said Egor Fomin, director of the Irkutsk Polymer Plant. “Thanks to our partners, including SUEZ, we intend to create in Eastern Siberia a high-tech safe production for the deep processing of hydrocarbons."

As per MRC, LyondellBasell, one of the world"s largest plastics, chemicals and refining companies and SUEZ, a world leader in environmental services, jointly announced the acquisition of TIVACO, a plastics recycling company located in Blandain, Belgium.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,220,640 tonnes in 2020, up by 2% year on year. Only shipments of low density polyethylene (LDPE) and high density polyethylene (HDPE) increased. At the same time, polypropylene (PP) shipments to the Russian market reached 1 240,000 tonnes in 2020 (calculated using the formula: production, minus exports, plus imports, excluding producers" inventories as of 1 January, 2020). Supply of exclusively PP random copolymer increased.
MRC

MOSCOW (MRC) -- BASF started up its new acrylic dispersions production line in Pasir Gudang, Malaysia, doubling its capacity, according to Process world wide.
The state-of-the-art facility will produce acrylic dispersions serving the coatings, construction, adhesives, and packaging industries in Asia Pacific.

The new production line complements the existing set-up and allows the production of new dispersions technologies under Acronal Edge, Acronal Plus, Joncryl and next generation Acronal Eco product ranges. We are committed to ensuring that our systems are environment-friendly. This new line is equipped with the condensate stripping recovery technology that reduces freshwater consumption and wastewater generation.

The production site at Pasir Gudang is situated in the integrated multi-purpose Johor Port Free Trade Zone, thus making it a strategic location for exports to the region. “With proximity to three world-class ports, the expansion will be a key supply point for our customers in Malaysia, Singapore and other ASEAN countries, also in Australia and New Zealand (ANZ). The first commercial quantities will be produced for our customers in March this year,” said Peter van der Zwan, Director of ASEAN & ANZ Dispersions & Resins, BASF.

“As a growth business within BASF, we will continue to invest into enhancing our asset network for polymer dispersions in this region, which is strongly backed by our own R&D capabilities in Asia Pacific. The new production line enables us to capture growth opportunities in the fast-growing emerging markets, as well as enhance our reliability towards our customers in ASEAN and ANZ,” said Jeff Knight, Senior Vice President, Dispersions & Resins, Asia Pacific, BASF.

BASF began operating its first acrylics dispersions production line in Malaysia in 2015 at Pasir Gudang.

We remind, as MRC reported earlier, that in mid-February, BASF said it was restarting one of its steam crackers at its Ludwigshafen complex in Germany after operations were halted last Wednesday due to a technical issue. The naphtha cracker produces ethylene and propylene, and is one of two crackers on the site. One has a production capacity of 420,000 metric tons/year, with the other's capacity at 240,000 metric tons/year, according to IHS Markit data.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,220,640 tonnes in 2020, up by 2% year on year. Only shipments of low density polyethylene (LDPE) and high density polyethylene (HDPE) increased. At the same time, polypropylene (PP) shipments to the Russian market reached 1 240,000 tonnes in 2020 (calculated using the formula: production, minus exports, plus imports, excluding producers" inventories as of 1 January, 2020). Supply of exclusively PP random copolymer increased.

BASF is the leading chemical company. It produces a wide range of chemicals, for example solvents, amines, resins, glues, electronic-grade chemicals, industrial gases, basic petrochemicals and inorganic chemicals. The most important customers for this segment are the pharmaceutical, construction, textile and automotive industries.
MRC

1. Global diesel margins leave refiners under pressure

MOSCOW (MRC) -- Global refiners are making more money for producing middle distillates such as gas oil and diesel now excess inventories accumulated during the first wave of the coronavirus epidemic have largely been absorbed, reported Reuters. Despite the improvement, however, margins remain low in comparison with the last two decades, pressured by the continuing downturn in demand for jet fuel, which comes from a similar part of the refining process. And margins are likely to remain depressed for several more months to keep capacity offline and restrict combined output of distillates and jet fuel, until travel restrictions are eased and international passenger aviation resumes.




MRC

MOSCOW (MRC) -- Crude oil futures fell during the mid-morning trade in Asia March 10 as bullishness over OPEC+ rolling over production quotas faded and the American Petroleum Institute reported a large build in US crude stocks, reported S&P Global.

At 11:23 am Singapore time (0323 GMT), the ICE Brent May contract was down by 37 cents/b (0.55%) from the March 9 settle at USD67.15/b, while the April NYMEX light sweet crude contract was 25 cents/b (0.39%) lower at USD63.76/b.

The markers have fallen 2.65% and 3.15%, respectively to date this week as crude oil markets try to find balance after the OPEC+ coalition's surprise decision last week to keep its production steady in April sent prices surging.

"The declines in oil benchmarks this week indicate that the optimism following last week's OPEC+ surprise had been overstretched and the pullback in oil prices was likely warranted based on technical factors, with the 14-day RSI easing away from overbought territory," Han Tan, market analyst at FXTM, told S&P Global Platts on March 10.

"Heightened expectations for the recovery in US oil production, fueled by the (Energy Information Administration's) upward revisions to output levels for this year and next, may also dampen the upside for oil prices," Tan added.

The EIA has revised up its outlook for 2021 production by 100,000 b/d to 11.1 million b/d, and for 2022 production by 500,000 b/d to 12 million b/d, Platts reported earlier.

API data released late March 9 showed a 12.8 million-barrel build in US crude inventories in the week ending March 5. The market reacted in early March 10 trade by pushing oil prices down.

"Oil prices slid further on a build in crude oil inventories of 12.792 million barrels for the week ending March 5," said Stephen Innes, chief global market strategist at Axi, in a March 10 note.

Innes however cautioned against putting too much weight on the API data: "I think it best to interpret the API data with a pinch of salt as it is unclear whether the reported stock build is a laggard effect of (EIA's) large build printed last week, or whether we will see another large build from the EIA (in its report due later March 10)."

The markets took solace in the much more bullish product data from the API, which showed 8.5 million-barrel and 4.8 million-barrel draws in US gasoline and distillate inventories, respectively. These movements in product inventories could be indicative of improved downstream fundamentals, which bodes well for the entire oil complex.

The demand outlook for the oil complex remained bright, and could receive a further boost later March 10 when the US House of Representatives is expected to vote on a Senate-approved USD1.9 trillion stimulus package.

"The build in crude inventories is set to be mitigated by the sustained demand recovery, especially as more US fiscal stimulus rolls out this month and virus-curbing measures are eased," Tan said.

As MRC informed previously, 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, according to an official with International Energy Agency's (IEA) statement.

We remind that the COVID-19 outbreak has led to an unprecedented decline in demand affecting all sections of the Russian economy, which has impacted the demand for petrochemicals in the short-term. However, the pandemic triggered an increase in the demand for polymers in food packaging, and cleaning and hygiene products, according to GlobalData, a leading data and analytics company. With Russian petrochemical companies having the advantage of access to low-cost feedstock, and proximity to demand-rich Asian (primarily China) and European markets for the supply of petrochemical products, these companies appear to be well-positioned to derive full benefits from an improving market environment and global economy post-COVID-19, says GlobalData.

We also remind that in December 2020, Sibur, Gazprom Neft, and Uzbekneftegaz agreed to cooperate on potential investments in Uzbekistan including a major expansion of Uzbekneftegaz’s existing Shurtan Gas Chemical Complex (SGCC) and the proposed construction of a new gas chemicals facility. The signed cooperation agreement for the projects includes “the creation of a gas chemical complex using methanol-to-olefins (MTO) technology, and the expansion of the production capacity of the Shurtan Gas Chemical Complex”.

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

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,220,640 tonnes in 2020, up by 2% year on year. Only shipments of low density polyethylene (LDPE) and high density polyethylene (HDPE) increased. At the same time, polypropylene (PP) shipments to the Russian market reached 1 240,000 tonnes in 2020 (calculated using the formula: production, minus exports, plus imports, excluding producers' inventories as of 1 January, 2020). Supply of exclusively PP random copolymer increased.
MRC