Sonoco investing USD7.1 million in German plastics plant

MOSCOW (MRC) -- Sonoco Products Co. is spending millions on "increased production capacity and environmental efficiency" at a plastic consumer packaging plant near Leipzig, Germany, said Plasticsnews.

Sonoco Consumer Products Europe will make the USD7.1 million investment during the next year at its plant in Zwenkau, Sonoco said.

News of the investment comes as the company also said it will close rigid paper container manufacturing sites in Bunde in Northwest Germany and Hockenheim in Southwest Germany.

"While the planned closure of Bunde and Hockenheim 3 is a difficult decision, the capital to be spent in Zwenkau will turn our production site into one of the most efficient German plants in the industry," said Sean Cairns, general manager of Sonoco Consumer Products Europe, in a statement.

Sonoco said its European consumer packaging business is growing, but has experienced a recent significant decline in tobacco packaging due to changes in the European Tobacco Product Directive. That directive is aimed at limiting the appeal of tobacco.

Sonoco expects to begin investing in the plastic consumer packaging plant early next year and be completed with the improvements by the end of the year. Zwenkau has both injection molding and extrusion, according to Sonoco’s website.

Sonoco, based in Hartsville, S.C., has more than 70 sites in Europe and more than 330 locations around the world.

As MRC informed earlier, Sonoco commenced commercial production of rigid plastic containers for personal care products at its new USD15 million plant, located in the Beauty and Home Care campus in New Albany, Ohio.

Sonoco Plastics is a leading manufacturer of mono-layer and multi-layer blow-molded bottles and jars, thermoformed cups and trays and engineered molded and extruded containers, spools and trays. The Company has 25 plastics operations in the United States, Canada, Mexico, Ireland, Netherlands and Germany. In addition to the Beauty Park facility, Sonoco Plastics operates a state-of-the-art food-grade, blow-molding and injection molding plant in Columbus, Ohio. The Company is currently reviewing plans for additional expansion of this facility as well.
MRC

MOSCOW (MRC) -- Taiwan’s major aromatics producer Formosa Chemicals & Fibre Corp (FCFC, part of Formosa Petrochemical) has been running its aromatics units at 90-100% operating rates since December 2015, a company source told TPS.

FCFC operates three aromatics units in Mai Liao, located in Taiwan’s northwestern Yunlin County.

Based on TPS data, FCFC’s No. 1 aromatics unit can produce 287,000 mt/year of PX, 213,000 mt/year of benzene and 80,000 mt/year of OX.

Its No. 2 aromatics unit can produce 573,000 mt/year of PX, 427,000 mt/year of benzene and 160,000 mt/year of OX.

Finally, the company’s No. 3 aromatics unit, which consists of a reformer and a TDP unit, is also able to produce 640,000 mt/year of benzene and 240,000 mt/year of orthoxylene (OX).

As MRC wrote before, Taipei- Formosa Plastics, also a subsidiary of Formosa Petrochemical, is considering construction of a plant in Louisiana to produce 1.2-million t/y of ethylene from shale gas.

Formosa Petrochemical is involved primarily in the business of refining crude oil, selling refined petroleum products and producing and selling olefins (including ethylene, propylene, butadiene and BTX) from its naphtha cracking operations. Formosa Petrochemical is also the largest olefins producer in Taiwan and its olefins products are mostly sold to companies within the Formosa Group. Among the company's chemical products are paraxylene (PX), phenyl ethylene, acetone and pure terephthalic acid (PTA). The company's plastic products include acrylonitrile butadiene styrene (ABS) resins, polystyrene (PS), polypropylene (PP) and panlite (PC).
MRC

MOSCOW (MRC) -- Despite the steep and sustained decline in crude oil prices that have reduced the export value of petrochemical products, South Korea’s petrochemicals export volume continue to rise on a series of free trade agreements (FTA), according to a report published by the Korea International Trade Association (KITA), reported TPS.

Since 2001, South Korea’s petrochemicals export volume has been increasing gradually, with total export volume that has more than doubled between 2001 and 2014.

The export value of petrochemical products, however, has dropped sharply since late 2014 in tandem with the plunge in oil prices.

For instance, from January to October, the country’s petrochemical export volume has increased by 5.4% on year, whereas the export value has declined by more than 20% over the same period last year.

The steady increase in export volume was mainly attributed to increased exports to the countries with the FTA in force including Turkey, US and Vietnam.

Based on the data from KITA, petrochemical exports to Turkey have increased by 25.8% on year, while exports to US and Vietnam have also increased 3.60% and 9.2% respectively.

It is also important to note that petrochemical exports to China, in which the FTA came into effect from Dec 20, have increased by 8.9% in terms of volume.

As MRC informed previously, Krean government is pushing forward with consolidation of the petrochemical industries, which are mired in a supply glut and the protracted global economic recession.

We also remind that, in March 2015, South Korea's Fair Trade Commission (KFTC) gave conditional approval to Hanwha's proposed acquisition of Samsung General Chemicals. The regulatory authority identified that the combined entity could dominate the domestic ethylene vinyl acetate (EVA) market, which could result in higher prices. However, markets of the other three chemical products including low-density polyethylene, linear low-density polyethylene and high-density polyethylene will not be significantly affected by the transaction, KFTC said.
MRC

MOSCOW (MRC) -- Brazil's state-controlled oil producer Petroleo Brasileiro SA has agreed to sign a naphtha supply contract with Braskem SA, Latin America's largest petrochemical producer, for five years, as per Reuters.

Under terms of the deal, which was announced in a securities filing, Braskem will pay the equivalent of 102.1% of the benchmark ARA price for naphtha, a petrochemical feedstock.

The contract will have a mechanism by which terms can be renegotiated as early as 2018, Petrobras said in a separate statement.

Braskem depends on naphtha from Petrobras to operate its Brazilian plants, the dominant supplier of polyethylene, polypropylene and polyvinyl chloride (PVC) to Brazil, the world's seventh-largest economy.

As MRC wrote before, Braskem SA will soon decide whether to build a plant in Texas or Pennsylvania to convert low-cost natural gas into polypropylene. The factory would produce at least 1 billion pounds (450,000 metric tons) of resin a year and would be the U.S. polypropylene industry’s first world-scale project in about 12 years, said Mark Nikolich, a vice president at Braskem in June 2015. Preliminary engineering is under way for construction at existing Braskem sites in either La Porte, Texas, or Marcus Hook, Pennsylvania.

Braskem S.A. produces petrochemicals and generates electricity. The Company produces ethylene, propylene, benzene, toluene, xylenes, butadiene, butene, isoprene, dicyclopentediene, MTBE, caprolactam, ammonium sulfate, cyclohexene, polyethylene theraphtalat, polyethylene, and polyvinyl chloride (PVC).
MRC

MOSCOW (MRC) -- Thailand’s Rayong Olefins has been running its aromatics units at 100% operating rates since it has restarted its cracker last week, a company source told TPS.

Rayong Olefins operates two aromatics units in Map Ta Phut, within Rayong Province where the country’s largest industrial park is located.

The company is able to produce about 360,000 mt/year of benzene and 156,000 mt of toluene from its Map Ta Phut-based aromatics units.

According to the source, the company does not have any plan for turnarounds in 2016. It is likely to have a scheduled turnaround for its aromatics units during Q1 2017.

As MRC informed previously, Rayong Olefins plans to shut its naphtha cracker at Map Ta Phut in December for two weeks. The cracker which is able to produce 400,000 mt/year of propylene and 800,000 mt/year of ethylene. It supplies feed stock to Thai Polyethylene which has the production capacity of 980,000 mt/year of high-density polyethylene (HDPE), 100,000 mt/year of low-density polyethylene (LDPE) and 110,000 mt/year of linear low-density polyethylene (LLDPE).

Rayong Olefins is a subsidiary of SCG Chemicals, one of the largest integrated petrochemical producers in Thailand which manufactures and supplies a full range of upstream and downstream petrochemical products, such as, ethylene, propylene, mixed C-4, benzene, and tulene which are supplied to downstream manufacturers of polyethylene and polypropylene.
MRC