COVID-19 - News digest as of 04.06.2021

1. Indonesia biodiesel consumption down 8.2% in Jan-Apr 2021

MOSCOW (MRC) -- Indonesia's consumption of biodiesel fell by 8.2% year on year in the first four months of 2021, data from the country's producers' association showed, as transportation demand remained muted due to the coronavirus pandemic, reported Reuters. Domestic consumption of biodiesel was 2.669 million kilolitres in the January to April period, down from 2.907 million kilolitres last year, according to the Indonesian biodiesel producers' association (Aprobi). "Transportation movement has still not recovered to 2019 levels," Paulus Tjakrawan, vice chairman of Aprobi told Reuters.

MRC

MOSCOW (MRC) -- Crude oil futures were lower during mid-morning trade in Asia June 4 as the market used mixed data from the Energy Information Administration as an excuse to lock in profits following the recent surge in oil prices, while a stronger dollar provided further headwinds for the market, reported S&P Global.

At 11:06 am Singapore time (0306 GMT), the ICE Brent August contract was down 26 cents/b (0.36%) from the previous settle at USD71.05/b, while the July NYMEX light sweet crude contract was down 19 cents/b (0.28%) at USD68.62/b.

Data from the EIA released late June 3 was mixed, as it showed a draw in US commercial crude inventories, but builds in US product inventories.

Rising refinery demand coupled with lower production saw crude stocks fall 5.08 million barrels to 479.27 million barrels in the week ended May 28, the data showed. Crude stocks are at its lowest since the week ended Feb. 19, nearly 3% behind the five-year average.

US gasoline and distillate inventories, meanwhile, climbed 1.5 million barrels and 3.72 million barrels to 233.98 million barrels and 132.8 million barrels, respectively.

"After an impressive rally that saw oil prices settle near multi-year highs on June 3, market participants took the builds in the downstream product inventories as a reason to pause and lock-in their profits," Vandana Hari, CEO of Vanda Insights, told S&P Global Platts June 4.

Hari, however, added that the builds in gasoline and distillate inventories belied strong demand for these products in the US. Other analysts have echoed a similar view, and are in particular optimistic over the prospect of a surge in gasoline demand, as Americans are expected to unleash pent-up demand for travel on the roads during the country's ongoing summer driving season.

Adding downward pressure on the oil markets was the appreciation in the US dollar, which came as the US Federal Reserve announced plans to wind down the corporate bond portfolio it bought during the pandemic, lending credence to the notion that it is considering further policy unwinds.

We remind that, as MRC wrote earlier, Indian refiners, anticipating a lifting of US sanctions, plan to make space for the resumption of Iranian imports by reducing spot crude oil purchases in the second half of the year. The world"s third-largest oil consumer and importer halted imports from Tehran in 2019 after former US President Donald Trump withdrew from a 2015 accord and re-imposed sanctions on the OPEC producer over its disputed nuclear programme.

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) -- Trinseo, a global materials company and manufacturer of plastics, latex binders, and synthetic rubber, and its affiliate companies in Europe, have announced a price decrease for all polystyrene (PS) and acrylonitrile-styrene copolymer (SAN) in Europe, according to the company's press release as of June 2.

Effective June 1, 2021, or as existing contract terms allow, the contract and spot prices for the products listed below went down as follows:

- STYRON general purpose polystyrene grades (GPPS) -- by EUR290 per metric ton;
- STYRON and STYRON A-Tech and STYRON X- Tech and STYRON C- Tech high impact polystyrene grades (HIPS) - by EUR290 per metric ton;
- TYRIL SAN resins - by EUR170 per metric ton.

As MRC informed before, Trinseo raised its prices for all PS, acrylonitrile-butadiene-styrene (ABS) and SAN grades on May 1, 2021, as stated below:

- STYRON GPPS -- by EUR105 per metric ton;
- STYRON and STYRON A-Tech and STYRON X- Tech and STYRON C- Tech HIPS - by EUR105 per metric ton;
- MAGNUM ABS resins - by EUR160 per metric ton
- TYRIL SAN resins - by EUR170 per metric ton.

According to ICIS-MRC Price report, Russian plants reduced their PS prices this month under the pressure from foreign markets and lower feedstock prices. Nizhnekamskneftekhim reduced its June prices of polymer by a larger amount than other plants.

Trinseo is a global materials company and manufacturer of plastics, latex and rubber. Trinseo's technology is used by customers in industries such as home appliances, automotive, building & construction, carpet, consumer electronics, consumer goods, electrical & lighting, medical, packaging, paper & paperboard, rubber goods and tires. Formerly known as Styron, Trinseo completed its renaming process in 1Q 2015. Trinseo had approximately USD3.0 billion in net sales in 2020, with 17 manufacturing sites around the world, and approximately 2,600 employees.
MRC

MOSCOW (MRC) -- Austrian energy and petrochemicals major OMV has appointed Alfred Stern as its new CEO, effective 1 September, said the company in its press release.

Stern, a former CEO of OMV’s Borealis chemicals and plastics business, is currently OMV executive board member with responsibility for Chemicals & Materials. He will be OMV’s CEO for a three-year period, with an extension option for a further two years.

Alfred Stern succeeds Rainer Seele, who will resign “by mutual agreement” on 31 August. Seele is leaving OMV earlier than expected. His current term of office was due to end on 30 June 2022. In April, Seele said he would not seek an extension.

In commenting on the leadership change, OMV supervisory board chairman Mark Garrett said that Stern has the "specialist expertise" and the experience in the chemical industry to lead OMV at a time of "major transformation in the direction of chemicals and a circular economy".

As MRC wrote before, OMV is investing EUR40 million (USD48 million) to expand and modernize a steam cracker and associated units at its refining and petrochemicals complex at Burghausen, Germany. The upgrade will increase the site’s ethylene and propylene production capacity by 50,000 metric tons/year. Following a planned turnaround of the refinery, the revamped cracker and petchem units are expected to start operations in the third quarter of 2022. Initial groundwork is already underway ahead of the upgrade.

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.

OMV produces and markets oil and gas, innovative energy and high-end petrochemical solutions – in a responsible way. With Group sales of EUR 23 bn and a workforce of around 20,000 employees in 2019, OMV Aktiengesellschaft is one of Austria’s largest listed industrial companies.
MRC

MOSCOW (MRC) -- The Adani Group will be developing a new coal-to-polyvinyl chloride (PVC) plant in Mundra, Gujarat, India, according to Kemicalinfo with reference to an application by the company to India’s Ministry of Environment, Forests & Climate Change.

The plant is expected to produce 2 million metric tons per year PVC grades such as suspension PVC (SPVC), chlorinated PVC (CPVC) and emulsion PVC (EPVC).

The company also intends to establish a vinyl chloride monomer (VCM) plant to produce PVC. This unit is projected to have a capacity of 2.002 million tons per year.

The company expects to complete the project within the next four years after receiving all the necessary approvals, it added.

The group stated that coal of about 3.1 million tonnes per year for the project will be sourced mainly from Australia, Russia and other countries.

According to the company, the project will produce 2.86 million metric tons per year of lime, 2.9 million metric tons per year of calcium carbide, and 860,000 metric tons per year of acetylene, and hydrate lime sludge from coal feedstock which are then processed to produce PVC.

In addition, the conglomerate also expects to produce 1.3 million metric tons per year of caustic soda, 1.23 million metric tons per year of hydrochloric acid (HCL), and 16,000 metric tons per year of sodium hypochlorite as byproducts. The facility is also expected to produce 130,000 metric tons per year of caustic potash, 100,000 metric tons per year of potassium carbonate, and 200,000 metric tons per year of sodium bicarbonate.

The proposed project will also help to reduce import dependence for polymers by promoting domestic production, the company concluded.

As MRC reported earlier, Technip Energies has been recently awarded a significant Engineering, Procurement, Construction and Commissioning (EPCC) contract by Indian Oil Corporation Limited (IOCL) for its BR9 Expansion Project in Barauni, Bihar, in the Eastern part of India. This EPCC contract covers the installation of a new Once-through Hydrocracker Unit (OHCU) of 1 million metric tonnes per annum (MMTPA) capacity, a Fuel Gas Treatment Unit (FGTU) and the associated facilities.

According to MRC's ScanPlast report, Russia's overall PVC production reached 346,100 tonnes in the first four months of 2021, down by 1% year on year. All producers decreased production volumes over the stated period, with the exception of Bashkir Soda Company.
MRC