COVID-19 - News digest as of 17.05.2021

.1 Asahi Kasei FY2020 net profit falls nearly by a quarter on weak materials business

MOSCOW (MRC) -- Asahi Kasei’s net profit for the fiscal year ending March 2021 slumped by 23.2%, weighed down by weakness in its materials business, and as the company booked a one-off loss for the period, as per the Japanese producer's statement. The materials segment was hit by global economic deterioration amid the coronavirus pandemic. Sales for the segment declined by 9.3% year on year to Y991.2bn, with operating profit falling by 28% to Y66.5bn. “Performance recovered from the second quarter with recovery of automotive-related markets and recovery of petrochemical market prices, but there was a significant impact from the pandemic especially in the first quarter,” Asahi Kasei said.


MRC

MOSCOW (MRC) -- Crude oil futures were slightly higher during mid-morning Asian trade May 17, but any upside was limited by concerns over renewed coronavirus-related mobility restrictions in the region, reported S&P Global.

At 11:03 am Singapore time (0303 GMT), the ICE Brent July contract was up 34 cents/b (0.49%) from the May 14 settle at USD69.05/b, while the June NYMEX light sweet crude contract was up 31 cents/b (0.47%) at USD65.68/b.

The market continues to monitor the progress of the COVID-19 pandemic in Asia, where a growing list of countries have tightened mobility restrictions.

Singapore and Taiwan, two countries that have thus far been lauded for reigning in the virus, are among the countries grappling with the rising number of infections. Singapore, on May 14, had introduced new restrictions under what it termed as 'Phase 2 (Heightened Alert)' to stem the recent rise in infections, whereas Taiwan, on May 15, followed suit, raising its coronavirus alert level in the capital, Taipei, and the surrounding city, and imposing two weeks of restrictions.

Meanwhile, over in India, Delhi extended its lockdown until May 24, Chief Minister Arvind Kejriwal said on May 16. Other parts of India, including states such as Maharashtra and West Bengal, have also extended their mobility restrictions, resulting in large swathes of the country currently under some form of lockdown.

Out in the west, fears over the spread of the B.1.167 mutant strain has also dampened market sentiment, even as the UK prepares to take a major step out of its lockdown on May 17. Health Secretary Matt Hancock said that the variant is more transmissible and could soon become the dominant strain in the region, with Prime Minister Boris Johnson also expressing concern over the strain, saying it could thwart the UK's plan to fully unravel all restrictions by June 21.

Market analysts have cautioned that the prospect of a deterioration in the pandemic situation poses significant downside risk for oil prices, but have added that the market remains supported for now by the increase in demand from the US and Europe. They expect the front month Brent marker to trade noisily around the USD69/b level.

As MRC informed earlier, 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 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 the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 576,270 tonnes in the first three month of 2021, up by 4% year on year. Low density polyethylene (LDPE) and high density polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market totalled 410,890 tonnes in January-March 2021, up by 56% year on year. Supply of homopolymer PP and PP block copolymers increased.
MRC

MOSCOW (MRC) - Chevron Corp said a fire that broke out at its 245,271 barrel-per-day Richmond, California refinery on Friday morning has been extinguished, reported Reuters.

No injuries were reported, according to the company.

In addition to the refinery fire crew, the Richmond fire department responded to the fire, the company said in a statement, adding the plant also experienced a process unit upset that caused some flaring.

A spokesperson from the Contra Costa Health Services department said it has requested a report on the incident within 72 hours.

“This report will give the refinery a chance to investigate the incident now that emergency conditions have been abated and provide details to our agency so that we can work together to identify root causes and prevent future similar issues,” it said.

As MRC wrote previously, Chevron Corp has restarted the 112,229 barrel-per-day (bpd) Pasadena, Texas, refinery night after completing a multi-unit overhaul that was extended because of the COVID-19 pandemic. The entire refinery was shut from mid-April, 2020, until mid-July, 2020 with the last units returning to production on Tuesday, 14 July. The overhaul was originally to finish in mid-June, but was extended to mid-July.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 576,270 tonnes in the first three month of 2021, up by 4% year on year. Low density polyethylene (LDPE) and high density polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market totalled 410,890 tonnes in January-March 2021, up by 56% year on year. Supply of homopolymer PP and PP block copolymers increased.

Headquartered in San Ramon, California, Chevron Corporation is the the second-largest integrated energy company in the United States and among the largest corporations in the world. Chevron is involved in upstream activities including exploration and production, downstream activities including refining, marketing and transportation, and advanced energy technology. Chevron is also invested in power generation and gasification processes.
MRC

MOSCOW (MRC) -- Saudi Ethylene and Polyethylene Company (SEPC), a subsidiary of Tasnee, is planning to start a routine maintenance at its cracker in Jubail on 23 May, 2021, according to CommoPlast with reference to market sources.

The cracker that produces 1 million tons/year of ethylene and 285,000 tons/year of propylene will be shut for a turnaround for about 27 days.

The company also operates a 400,000 tons/year of high density polyethylene (HDPE) and a 400,000 tons/year of low density polyethylene (LDPE) plant at the same site.

As MRC informed before, Saudi Arabia's National Industrialization Company, or Tasnee, had announced a curtailment of feedstock to petrochemical affiliates in varying proportions by an average of 41% due to the attacks on key Saudi Aramco facilities on Saturday, 14 September 2019. Tasnee owns a majority stake in Saudi Polyolefins Company and Saudi Ethylene and Polyethylene Company.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 576,270 tonnes in the first three month of 2021, up by 4% year on year. Low density polyethylene (LDPE) and high density polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market totalled 410,890 tonnes in January-March 2021, up by 56% year on year. Supply of homopolymer PP and PP block copolymers increased.

SEPC is a joint venture between Tasnee, Sahara Petrochemical Company, and LyondellBasell.
MRC

MOSCOW (MRC) -- OQ Chemicals (Monheim am Rhein, Germany) has announced global price increases for several oxo intermediate and polyols products, according to PCE with reference to the company's statement.

Thus, the company will increase prices for the following products effective 13 May, 2021, or as contracts allow: 2-Ethyl Hexanol, n-Butanol, Isobutanol, n-Butyl Acetate, Isobutyl Acetate, n-Propanol, n-Propyl Acetate, Neopentyl Glycol (NPG), Trimethylol Propane (TMP), n-Butyraldehyde, n-Propionaldehyde, and Isobutyraldehyde.

The present price increase is due to unprecedented strong demand and limited availability.

At the same time, details of the specific increases were not provided, with the company asking customers to contact its sales representatives to receive latest prices.

OQ Chemicals has already announced several price increases for its oxo intermediate products this year, citing strong demand and rising raw material costs.

As MRC wrote before, in September 2020, OQ Chemicals entered into an agreement to license its advanced proprietary technology for the production of ethylene and propylene derivatives to Duqm Refinery and Petrochemicals Industries Company (DRPIC) in Oman. DRPIC, a joint venture between Oman Oil Company and Kuwait International Oil Company, is a planned grassroots petrochemical complex at Duqm, Oman. In all, DRPIC awarded twelve license packages to international licensors.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 576,270 tonnes in the first three month of 2021, up by 4% year on year. Low density polyethylene (LDPE) and high density polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market totalled 410,890 tonnes in January-March 2021, up by 56% year on year. Supply of homopolymer PP and PP block copolymers increased.

OQ Chemicals, formerly Oxea, is a global manufacturer of oxo intermediates and oxo derivatives, such as alcohols, polyols, carboxylic acids, specialty esters, and amines. These products are used for the production of high-quality coatings, lubricants, cosmetics and pharmaceutical products, flavours and fragrances, printing inks and plastics. OQ Chemicals is part of OQ, an integrated energy company that delivers sustainability and business excellence. OQ operates in 16 countries and covers the entire value chain from exploration and production to the marketing and distribution of its products.
MRC