Ukrainian PP imports down by 3% in H1 2021

MOSCOW (MRC) -- Polypropylene (PP) imports into the Ukrainian market totalled 59,500 tonnes in the first half of 2021, down by 3% year on year. Homopolymer of propylene (homopolymer PP) accounted for the main decrease in imports, according to MRC's DataScope report.

June PP imports to Ukraine dropped to 9,800 tonnes from 10,100 tonnes a month earlier, local companies significantly reduced their purchases of propylene copolymers in Europe due to a record high level of export prices. Overall imports of propylene polymers reached 59,500 tonnes in January-June 2021, compared to 61,100 tonnes a year earlier. At the same time, imports of propylene copolymers increased, whereas imports of homopolymer PP decreased substantially.

The supply structure by PP grades looked the following way over the stated period.

In the fist month of summer, imports of homopolymer PP to the Ukrainian market exceeded 7,500 tonnes due to a major increase in shipments from China, whereas this figure was at 6,600 tonnes in May. Thus, overall homopolymer PP imports reached 44,100 tonnes in the first six months of 2021, down by 8% year on year.

Last month's imports of block copolymers of propylene (PP block copolymers) were 800 tonnes, compared to 1,400 tonnes in May, shipments of injection moulding PP block copolymers from Saudi Arabia were completely ceased. 5,900 tonnes of PP block copolymers were imported in the first half of 2021, compared to 5,700 tonnes a year earlier.

June imports of statistical copolymers of propylene (PP random copolymers) decreased to 1,100 tonnes from 1,800 tonnes a month earlier, deliveries of pipe grade PP were reduced. Overall imports of PP random copolymer reached 7,800 tonnes in the first six months of 2021 versus 6,500 tonnes a year earlier.

Overall imports of other propylene copolymers totalled slightly over 1,800 tonnes over the stated period.

MRC

MOSCOW (MRC) -- The Federal Antimonopoly Service (FAS) has satisfied the petition of SIBUR, the largest petrochemical holding in Russia and Eastern Europe, to acquire 100% of the voting shares of TAIF holding, reported Vedomosti, citing the regulator's media service.

The company's business merger was announced earlier, on 23 April. The FAS believes that such a decision will "strengthen Russia's position as a non-resource exporter with full satisfaction of the interests of the domestic market," according to the ministry's message.

At the same time, the regulator issued an order to SIBUR on the fulfillment of a number of mandatory conditions for the transaction. Thus, the holding will have to meet the needs of the domestic market with its products. For example, the company will be able to process liquefied petroleum gas only partially, since in unprocessed form this type of raw material is used as fuel, partially for the needs of housing and communal services.

By the end of this year, SIBUR will have to submit to the FAS its draft trade policy for consideration, which will present a scheme for the sale of all goods produced by the company with a share of more than 50% in the Russian commodity market. In the same document, provisions will be enshrined that guarantee the protection of the rights of potential counterparties of the holding, which cannot be infringed upon, also through the creation of discriminatory or imposition of unfavourable conditions.

It is clarified that SIBUR will not be able to refuse to conclude supply contracts in Russia without economic or technological reasons. In addition, the company will be obliged to sell products under direct long-term contracts, given the possibility of efficient delivery of goods to the consumer, the FAS noted.

As MRC reported earlier, in April 2021, SIBUR Holding and TAIF announced the start of the merger of the oil and gas chemical businesses of the companies. As part of the merger, a company will be created on the basis of SIBUR Holding PJSC, in which the existing shareholders of TAIF will receive a 15% stake in exchange for the transfer of a controlling stake in a group consisting of petrochemical and energy enterprises. The remaining stake in TAIF can be subsequently purchased by the merged company.

The combined group's overall capacities of eight base polymers will be at 5.7 million tonnes, or 70.7% of those operating in Russia. Today, SIBUR's capacity for base polymers is almost twice that of TAIF. SIBUR's eight production sites have a capacity of 3.9 million tons and TAIF has two plants (Kazanorgsintez and Nizhnekamskneftekhim) with a total capacity of 2.2 million tons.

As a result of the merger, the total capacity share of the new SIBUR-TAIF group will be 100% for the production of linear low density polyethylene (LLDPE), 87.4% - for polypropylene (PP), 80.8% - for high density polyethylene (HDPE) and 59.3% - for low density polyethylene (LDPE).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 953,400 tonnes in the first five months of 2021, which virtually corresponded to the same figure a year earlier. High denisty polyethylene (HDPE) shipments decreased. At the same time, PP shipments to the Russian market were 607,8900 tonnes in January-May 2021, up by 33% year on year. Shipments of homopolymer PP and PP block copolymers increased, whereas deliveries of PP random copolymers decreased.

SIBUR manufactures and sells petrochemical products in the Russian and international markets in two business segments: olefins and polyolefins (polypropylene, polyethylene, BOPP, etc.), as well as plastics, elastomers and intermediate products (synthetic rubbers, expanded polystyrene, PET, etc.).

PSC "TAIF" was established in 1995 and is the parent company of the group with the same name, which includes enterprises structured in four business areas: oil and gas processing, chemistry and petrochemistry (energy); investment and financial services; building; telecommunications and complex services, including trade. TAIF Group of Companies is a large Russian holding that controls 96% of the chemical, petrochemical and oil and gas processing industries in Tatarstan. The most important of its areas is the Chemical, Petrochemical and Oil and Gas Processing Divisions, which include the leading Russian polymer producers Nizhnekamskneftekhim and Kazanorgsintez.
MRC

MOSCOW (MRC) -- German supermarkets Lidl and Kaufland’s own-branded non-reusable bottles are now made from 100% recycled polyethylene terephthalate (R-PET), removing 48,000 tonnes of new plastic from the market, said ESM.

Recently, all disposable PET deposit bottles produced by “Schwarz Produktion” for Lidl’s and Kaufland’s own brands in Germany have been made of 100 percent recycled plastic (rPET), excluding the cap and label.

Each of these new bottles at Lidl and Kaufland, which belong to the Schwarz Group, is produced entirely from old bottles. The Schwarz Group achieved this significant developmental step in PET recycling through high investments in the recyclable materials cycle, partly self-developed solutions and know-how built up over many years.

As early as 2008, Lidl took on a pioneering role in the circular economy with the development of the “Saskia” recyclable bottle. The retail division now offers around 60 types of beverages in non-refillable PET bottles made from 100 percent recycled material. Lidl customers can recognize the bottles by the “verantwortlicher verpackt”(more responsibly packaged) logo. Lidl is also focusing on sustainability in its marketing campaign with posters made from recycled material.

At the Kaufland retail division, the bottles of around 50 beverage varieties by the K-Classic private label are made from 100 percent rPET. These bottles are marked with the “bewusster verpackt” (more consciously packaged) logo.

By increasing rPET use to 100 percent for non-refillable PET bottles, the Schwarz Group will save a total of 48,000 tons of new plastic and 79,000 tons of CO2 in 2021 – compared to PET bottles without recyclate, the company says.

As per MRC, Delta-Pak company (Rossosh, Voronezh region) plans to organize the production of fully recyclable polymeric combined polyethylene film (Full-PE), which is used for a wide range of food and non-food products. The project meets the objectives of the national project "Ecology" and the achievement of national development goals to create a comfortable and safe environment for life. During the implementation of the project, eight highly productive jobs will be created.

As per MRC ScanPlast, total estimated PET consumption increased by 15% in May compared to the same indicator a year earlier and amounted to 85,850 tonnes. Total estimated consumption amounted to 349,940 tonnes of PET in January-May 2021 in Russia, up 22% year on year.
MRC

MOSCOW (MRC) -- The rouble weakened to a one-week low against the dollar at one stage losing almost 1%, hit by retreating oil prices after OPEC+ overcame internal divisions and agreed to boost output, a move that also sent Russian stocks tumbling, reported Reuters.

By 1529 GMT, the rouble was 0.8% weaker against the dollar at 74.63, a one-week low, and had lost 0.8% to trade at 88.16 versus the euro.

Brent crude oil, a global benchmark for Russia's main export, was down 5.4% at USD69.60 a barrel.

Oil prices were lower after OPEC+ ministers agreed on Sunday to increase oil supply from August to cool prices which have climbed to 2-1/2 year highs as the global economy recovers from the coronavirus pandemic.

"Despite the local drawdown, we view the increase in Russia's oil production quota as positive for the rouble in the medium term," said Promsvyazbank analysts in a note.

The fall in oil prices was adding to Russian headwinds on Monday, said Alfa Bank in a note, with risk-off sentiment over the spread of the Delta variant of the coronavirus offsetting strong earnings and resurgent consumer demand.

The rouble does have the support of a month-end tax period which usually prompts export-focused companies to convert revenues in foreign currencies into roubles and expectations of a rate hike by the central bank later this week. Governor Elvira Nabiullina said last month the board may consider raising rates from 5.5% by 25-100 basis points at its July 23 meeting to rein in inflation.

A Reuters poll on Monday showed market expectations leaning towards a 100 basis-point interest rate hike on Friday.

Russian stock indexes were at their weakest since late May. The dollar-denominated RTS index was down 3% to 1,555.5 points, its lowest since May 21. The rouble-based MOEX Russian index was 2.3% lower at 3,682.8 points, its weakest since May 25.

As MRC informed earlier, Russia's offline oil refining capacity is expected to decline by 19.5% month-on-month to 2.866 million tonnes in July, according to Refinitiv Eikon data and Reuters calculations. The offline capacity has been revised up in June, by 12.6% from the previous plan to 3.560 million tonnes.

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 953,400 tonnes in the first five months of 2021, which virtually corresponded to the same figure a year earlier. High denisty polyethylene (HDPE) shipments decreased. At the same time, PP shipments to the Russian market were 607,8900 tonnes in January-May 2021, up by 33% year on year. Shipments of homopolymer PP and PP block copolymers increased, whereas deliveries of PP random copolymers decreased.
MRC

MOSCOW (MRC) - The Gazprom neftekhim Salavat plant (GNS, Salavat, Bashkortostan) has summed up the results of production activities for the first half of 2021, the company said.

In the reporting period, the production of plasticizers at the enterprise increased by 33.8% and reached 16,140 tonnes, and the production of butyl alcohols increased by 25.6% and amounted to 54,470 tonnes.

At the same time, the production of low-density polyethylene (LDPE) increased to 18,710 tonnes, which is 5.3% more than in the first half of 2020.

In total, in the first 6 months of this year, the refining depth of crude oil was 93.6% (+ 2.5%), and the yield of light oil products reached 76.3% (+ 1.2%). Road petroleum bitumen was produced 94.58 thousand tons, which is 14.5% more compared to the same period last year - 82,570 tonnes.

The production of commercial gasoline at the enterprise increased by 2.8% and reached 637,290 tonnes. At the same time, the production of AI-95-K5 gasoline increased by more than 150.6% - from 33,770 tonnes in the first half of 2020 to 84,610 tonnes in the first half of 2021. Distillate of grade A gas condensate was produced by 60% more, and its volumes increased from 222,350 tonnes in the first half of 2020 to 355,750 tonnes in the first half of 2021.

It was also reported that last year the GNS increased the depth of oil refining to 91.9%. In the context of restrictive measures and measures to prevent the spread of a new coronavirus infection in 2020, employees of the Gazprom neftekhim Salavat oil refinery ensured the operation of the facilities in normal mode and fulfilled the production plan.

As MRC reported, GNS on 10 August, 2020 resumed production of LDPE after scheduled maintenance work. Production downtime lasted a little longer than originally planned. LDPE production capacities were stopped for repairs from 1 July 1. Meanwhile, from July 1, 2020, during the week, repairs were also carried out at the facilities of the gas pumping station for the production of high-pressure polyethylene (HDPE).

According to the ScanPlast of MRC, in May the total volume of HDPE output at Gazprom neftekhim Salavat reached 11,400 tonnes against 10,200 tonnes in April. Thus, in January - May of this year, the total volume of production of this type of PE at the Salavat enterprise amounted to 48,900 tonnes, which is 8% less than a year earlier.

OJSC Gazprom neftekhim Salavat (formerly OJSC Salavatnefteorgsintez) is one of the leading petrochemical companies in Russia, which carries out a full cycle of hydrocarbon processing. The list of commercial products manufactured by the enterprise includes more than 140 items, including 76 items of main products: motor gasolines, diesel fuels, kerosene, heating oil, toluene, solvent, liquefied gases, benzene, styrene, ethylbenzene, butyl alcohols, phthalic anhydride, etc. plasticizers, polyethylene, polystyrene, silica gels and zeolite catalysts, corrosion inhibitors, elemental sulfur, ammonia and urea, glycols and amines, a wide range of plastics household products, surfactants and much more.
MRC