MOSCOW (MRC) - Record gas prices have a significant impact on the petrochemical market, said RBK with reference to the words of SIBUR head D. Konov.
Dmitry Konov, Chairman of the Board of SIBUR Holding, said that the "main evil" for the petrochemical market this year is not the rise in prices, but the speed and frequency of their change. "The main evil - and this is true for both us and the consumer - is not some absolute level of prices, but the speed and frequency of their changes. When prices rise and fall by 30% month by month, this is bad," Konov said.
He noted that this year there were many such phenomena that led to record gas prices. This includes interruptions in American production, an accident at the Urengoy plant for preparing condensate for transport, and force majeure events in Europe. Konov stressed that as a result of this, "the long-standing established system is failing," which manifests itself in the hypervolatility of product prices and leads to anomalous delivery costs from one geography to another.
The head of SIBUR added that the price of "incoming raw materials" (liquefied carbon gas, etc.), which the company purchases, will increase by tens of percent, which will lead to an increase in production costs. He noted that in 2021 the cost of petrochemical products is higher than in 2020, but lower in comparison with the end of 2018. However, the price of raw materials is "much higher" than in 2019 and 2020, but is at the level of 2018.
“I think that the beneficiaries in terms of sales and prices have become any industries that produce a physical product. But the cost of any physical product has also become higher, therefore, on the one hand, we are beneficiaries due to the rise in prices for our products. - We, like everyone else, have increased the cost. In this sense, we have suffered and continue to suffer ", - concluded D. Konov.
Earlier, the international rating agency Fitch calculated how much Russia can earn on expensive oil. According to analysts, state revenues may even exceed the level of the pre-pandemic 2019. Earlier it was reported that SIBUR closed the deal to acquire 100% of TAIF JSC, which includes Nizhnekamskneftekhim, Kazanorgsintez and TGK-16.
Ethylene and propylene are the main raw materials for the production of polyethylene (PE) and polypropylene (PP), respectively.
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 the first nine months of 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 PP random copolymers decreased significantly.
SIBUR manufactures and sells petrochemical products on 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.)
MRC