PP prices in Russia remained steady from late October

MOSCOW (MRC) - Scheduled maintenance works of several production facilities in the second half of October led to an increase in polypropylene (PP) prices on the Russian market. The shutdowns have finished, but PP prices remained steady, according to the ICIS-MRC Price Report.

Three Russian producers shut their capacities for maintenance works in September - November. In parallel, the prices of polypropylene were growing in some export directions. As a result, because of a limited supply of PP in the domestic market and the situation in foreign markets in the second half of October, Russian producers increased prices on average by roubles (Rb) 3,000/tonne.

The shutdowns ended by the second half of November, but this factor did not affect prices. The last maintenance works at Russian plants ended on 11 November, Stavrolen resumed its work after almost a month's downtime, the annual capacity of which is 120,000 tonnes.

Ufaorgsintez and Poliom stopped their production for maintenance works in September - October. Nevertheless, supply of Russian homopolymer PP remained.

Stavrolen again stopped its production from 2 December for a week due to technological issues, and the producer plans to cut production of homopolymer PP in favour of propylene copolymers. Due to technical problems, Ufaorgsintez reduced capacity utilisation, and there is a high likelihood of restrictions on homopolymer PP supplies to the domestic market in December.

Some market participants reported tight supply of PP from other producers. But there has been no need to talk about a deficit of homopolymer PP sin the Russian market so far. The demand for polymer from several consumption segments seasonally decreased, with the most noticeable decrease in processing volumes was in the construction sector.

Also, a fairly large number of converters have sufficient PP stocks from the past months. Foreign market have not affected Russian PP prices; due to a some factors, a decrease in prices was seen in a number of export directions.
As a result, Russian producers decreased export PP prices significantly in December.

Domestic prices of homopolymer PP have been steady since the second half of October, with the greatest fluctuations from some sellers. This week's spot deals for homopolymer PP raffia grade were done at Rb155,000-158,000/tonne CPT Moscow, including VAT. Prices for injection moulding homopolymer PP were heard at Rb157,000 - 160,000/tonne CPT Moscow, including VAT.

MRC

MOSCOW (MRC) -- Koch Modular Process Systems, LLC (Koch Modular), a market leading provider of engineered and fabricated modular mass transfer systems for the chemical processing industry, has announced its fabricated process modules have been installed in support of the first manufacturing plant for Origin Materials (Origin), located in Sarnia, Canada, according to Hydrocarbonprocssing.

Installation of the key production modules of the plant (Origin 1) was completed in October of 2021, six months ahead of their schedule.

Koch Modular was engaged early in the process by Origin because of the company’s demonstrated expertise in reaction, distillation, and filtration unit operations. The front end of Origin’s process was a primary focus, converting biomass to sustainable materials including chloromethylfurfural (CMF) and hydrothermal carbon (HTC). Downstream of Koch Modular’s system, Origin’s process involved the conversion of CMF into polyethylene terephthalate (PET); a strong and lightweight thermoplastic material commonly used in packaging, textiles, and many other products.

Koch Modular designed and manufactured the plant’s 17 core process modules which were delivered to site on schedule. Module installation of Origin 1 was set to be completed by the end of Q4 of 2021 as announced in April 2021.

Module installation took place well ahead of schedule, in October 2021, significantly de-risking the project. The plant remains on track for completion by the end of 2022, with commissioning and production start-up thereafter.

As MRC reported earlier, in April 2021, Origin Materials, Inc., the world’s leading carbon negative materials company, and Mitsubishi Gas Chemical, Inc., a global leader in basic and fine chemicals and advanced materials, announced a partnership to industrialize and manufacture advanced chemicals and materials built on the Origin Materials technology platform.

According to MRC's ScanPlast report, the estimated PET consumption in Russia increased to 67,970 tonnes in October 2021, up by 17% year on year (58,030 tonnes in October 2020). Russia's overall PET consumption reached 661,830 tonnes in the ten months of 2021, up by 13% year on year.
MRC

MOSCOW (MRC) -- Clariant’s catalysts business unit continues to advance its R&D capabilities. The company recently made a significant investment to modernize its research facility in Toyama, Japan, preparing it for faster, more efficient experimentation, according to Hydrocarbonprocessng.

In addition to being Clariant’s global competence center for nickel-based hydrogenation and styrene catalyst development, the Toyama site is also involved in other research fields, including custom catalysts, emission control, and emerging applications of power-to-x technologies.

Two key products developed in Toyama are Clariant’s NiSat powder catalysts for hydrogenation, and StyroMax styrene production catalysts. Capacity for synthesis and evaluation of NiSat catalysts has now more than doubled. This significantly accelerates new catalyst lead generation and scale-up, while application tests ensure products meet customer requirements. For styrene catalysts, a new test unit allows more accurate simulation of industrial reactor conditions in styrene production. This not only enhances Clariant’s capabilities in styrene catalyst development, but also strengthens cooperation with process licensors.

Marvin Estenfelder, Head of Global R&D at Clariant's Business Unit Catalysts, commented, “The Toyama expansion is part of our strategy to steadily sharpen our R&D profile around the world. In 2020, we doubled the capacity of our high-throughput catalyst R&D center in Palo Alto, California. And earlier this year, we inaugurated our state-of-the-art R&D center at the new One Clariant Campus in Shanghai. These developments strengthen our research capacities globally and they allow us to respond faster to regional needs.”

Founded in 1964, Clariant Catalysts Japan conducts R&D and production from its facilities in Toyama, as well as customer relations and technical services from its offices in Tokyo. The Toyama facility is one of Clariant Catalysts’ 10 global R&D centers, and the third largest of its 14 production bases.

As MRC reported earlier, in October 2020, Clariant announced the construction of a new state-of-the-art catalyst production site in China. This project represents a significant investment which further strengthens Clariant’s position in China and enhances its ability to support its customers in the country’s thriving petrochemicals industry.

The new facility will be primarily responsible for producing the Catofin catalyst for propane dehydrogenation, which is used in the production of olefins such as propylene. Thanks to its excellent reliability and productivity, Catofin delivers superior annual production output compared to alternative technologies, resulting in increased overall profitability for propylene producers, says the company. Construction at the Dushan Port Economic Development Zone in Jiaxing, Zhejiang Province was scheduled to commence in Q3 2020, and Clariant expects to be at full production capacity by 2022.

Propylene is the main feedstock for the production of polypropylene (PP).

According to MRC's ScanPlast report, PP shipments to the Russian market were 1,138,510 tonnes in January-September 2021, up by 30% year on year. Supply of propylene homopolymer (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding statistical copolymers of propylene (PP random copolymers) decreased significantly.

Clariant AG is a Swiss chemical company and a world leader in the production of specialty chemicals for the textile, printing, mining and metallurgical industries. It is engaged in processing crude oil products in pigments, plastics and paints.
MRC

MOSCOW (MRC) -- ExxonMobil affiliate Esso Petroleum Company Limited, SGN and Macquarie’s Green Investment Group (GIG) signed a Memorandum of Understanding (MoU) to explore the use of hydrogen and carbon capture for a hydrogen hub project in the Southampton industrial cluster, said the company.

Southampton is one of the UK’s largest industrial sectors, and a critical element of the country’s energy supply chains. An initial feasibility study by SGN and GIG estimates that the annual hydrogen demand from the industrial cluster, which is home to ExxonMobil’s Fawley complex could rise to 37 TWh by 2050. This estimate includes heating demand of 800,000 homes across the south of England.

The study also estimates that carbon capture could play a key role to help reduce emissions. Carbon capture facilities placed in the area could capture approximately 2m tonnes/year of carbon dioxide (CO2), including from initial hydrogen production of 4.3 TWh/year of hydrogen. The companies said that if technical and business feasibility is confirmed, they could start hydrogen production as early as 2030, provided they have government support.

SGN, formerly known as Scotland Gas Networks before 2014, manages the pipelines that distribute natural gas and green gas to 5.9m homes and businesses across the region. GIG manages portfolio assets that specialise in green infrastructure investment and project development. It was initially launched by the UK in 2012 as the Green Investment Bank. In 2017 it was bought by Macquarie and combined with the firm’s renewables team, operating under GIG.

As MRC informed previously, ExxonMobil and SABIC have announced that their joint venture, Gulf Coast Growth Ventures located near Corpus Christi, Texas, has reached mechanical completion of a monoethylene glycol (MEG) unit and two polyethylene (PE) units. Project startup is expected to begin ahead of schedule, likely in the fourth quarter of 2021.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,868,160 tonnes in the first nine months of 2021, up by 18% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,138,510 tonnes in January-September 2021, up by 30% year on year. Supply of propylene homopolymer (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding statistical copolymers of propylene (PP random copolymers) decreased significantly.

ExxonMobil is the largest non-government owned company in the energy industry and produces about 3% of the world's oil and about 2% of the world's energy.
MRC

MOSCOW (MRC) - Oil prices fell on Thursday on fears about the economic outlook in the world’s biggest oil importer following ratings downgrades to two Chinese property developers, and after some governments took measures to fight the Omicron varaint of the coronavirus, reported Reuters.

Brent crude futures fell USD1.01, or 1.3%, to USD74.81 a barrel by 12:05 p.m. EDT (1705 GMT), backing off a session high of USD76.70. US West Texas Intermediate (WTI) crude futures were down USD1.00, or 1.4%, at USD71.36 after hitting a peak of USD73.34.

On Thursday, ratings agency Fitch downgraded property developers China Evergrande Group and Kaisa Group to “restricted default” status, saying they had defaulted on offshore bonds, while a source said that Kaisa had started work on restructuring its USD12 billion offshore debt.

“The ... news ... exacerbates the Chinese GDP growth fears and ultimately could impact the oil-buying appetite of the world’s biggest crude customer,” said Rystad Energy analyst Louise Dickson.

On Wednesday, British Prime Minister Boris Johnson imposed tougher COVID-19 restrictions in England, saying people should work from home where possible, wear masks in public places and show COVID-19 vaccine passes for entry to certain events and venues.

“Although laboratory tests showed that the Pfizer vaccine has a neutralising effect on Omicron ... new measures are being introduced to try to stop the spread of the virus,” said Tamas Varga of oil brokerage PVM.

Denmark also plans new restrictions, including closure of restaurants, bars and schools, while China has halted group tourist trips from Guangdong. South Korea has registered record infections while cases remain elevated in Singapore and Australia.

The number of Americans filing new claims for unemployment benefits dropped to the lowest level in more than 52 years last week as labor market conditions continued to tighten amid an acute shortage of workers, according to new data published by the US Labor Department.

“The oil market doesn’t always respond well to good economic news either, because it could prompt the Federal Reserve to tighten monetary policy,” said John Kilduff, partner at Again Capital LLC in New York.

The Omicron outbreak sparked a 16% slump in Brent prices from Nov. 25 to Dec. 1. More than half of the drop has been recouped this week, but analysts say a further recovery could be limited until Omicron’s impact is clearer.

US inventory data released on Wednesday also weighed on prices.

Energy Information Administration (EIA) data showed that crude inventories were down by 240,000 barrels last week, much less than analysts in a Reuters poll had expected, with stocks at the Cushing delivery hub in Oklahoma rising by 2.4 million barrels. Fuel stocks also rose by a combined 6.6 million barrels, the data showed.

As MRC informed before, US commercial crude stocks fell 3.48 million barrels to 413.96 million barrels in the week ended Sept. 17, to more than 8% below the five-year average, Energy Information Administration data showed. Stocks were last lower Oct. 5, 2018.

We remind that in late August, 2021, US crude stocks dropped sharply while petroleum products supplied by refiners hit an all-time record despite the rise in coronavirus cases nationwide, the Energy Information Administration said. Crude inventories fell by 7.2 million barrels in the week to Aug. 27 to 425.4 million barrels, compared with analysts' expectations in a Reuters poll for a 3.1 million-barrel drop. Product supplied by refineries, a measure of demand, rose to 22.8 million barrels per day in the most recent week. That's a one-week record, and signals strength in consumption for diesel, gasoline and other fuels by consumers and exporters.

We also remind that US crude oil production is expected to fall by 160,000 barrels per day (bpd) in 2021 to 11.12 million bpd, EIA said in a monthly report earlier this year, a smaller decline than its previous forecast for a drop of 210,000 bpd.
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