24 August 2009 00:00 [Source: ICB]
CHEMTURA PUTS PVC ADDITIVES UP FOR SALE
Bankrupt US-based specialty chemical firm Chemtura has put its polyvinyl chloride (PVC) additives business on the selling block, an investment banker source said. "Other business may be coming afterwards, but so far, it's just the PVC additives business. [Global investment bank] Lazard is managing the sale," he said. "The PVC additives business has revenues of around $200m-300m/year [€140m-210m/year]." Chemtura and Lazard declined to comment.
EUROPE CHEMICAL SECTOR TO IMPROVE IN H2
Germany's BASF and LANXESS, and France's Rhodia are set to benefit from reduced destocking, increased sales and improved operating rates in the second half of 2009, according to JPMorgan. "As customer destocking slows and sales volumes start to increase, we expect operating rates to show a greater improvement in the remainder of 2009," said the bank. "We see BASF, LANXESS and Rhodia as the three key beneficiaries of this trend and these remain our top picks amongst the diversified industrial chemical sector."
US GROUPS SUE CPCHEM
US environmental groups Sierra Club and Environment Texas filed a lawsuit on August 19 in a federal court against US-based Chevron Phillips Chemical (CPChem), accusing the producer of repeated violations of the US Clean Air Act at its Cedar Bayou chemical plant, in Baytown, Texas. The suit accused the facility of releasing more than 1m lbs (450 tonnes) of excess air pollutants since 2003, including benzene and 1,3-butadiene.
SIDPEC LINE STILL DOWN
Egypt-based Sidi Kerir Petrochemicals (Sidpec's) blow-molding high density polyethylene (HDPE) production line is down following a failed restart, a company source said. The company had attempted a restart after scheduled maintenance that began on July 16 at its 150,000 tonne/year Ameriva facility in Egypt. "We do not know when it will be back up," the source said.
BAYER CROPSCIENCE TO ACQUIRE ATHENIX
Germany's Bayer CropScience has agreed to acquire US biotech firm Athenix in a move to strengthen its position in the seeds and traits market. Athenix, which employs 65 at its base in North Carolina, has an extensive herbicide tolerance and insect control trait development platform, particularly for corn and soy, Bayer said. The acquisition will also bolster Bayer CropScience's trait platform for its established core crops, such as oilseeds, cotton, rice and wheat, it added.
CORN PRODUCTS AWARDED $58M IN NAFTA RULING
A North American Free Trade Agreement (Nafta) tribunal has awarded US corn refiner and food ingredients supplier Corn Products $58m (€41m) in damages in a case against Mexico over a tax on beverages containing high fructose corn syrup (HFCS). The case goes back to a complaint filed by Corn Products and its Mexican affiliate, CPIngredientes, in 2003. Corn Products argued that the imposition by Mexico of a discriminatory tax on beverages containing HFCS breached various Mexican obligations under the investment protection provisions of Nafta.
KEMIRA GETS SUMMONS FOR ALLEGED CARTEL
Finnish specialty chemical producer Kemira has received a summons relating to a court action against six hydrogen peroxide manufacturers for alleged violations of competition law. "Kemira has today received a summons where it is stated that Cartel Damage Claims (CDC) has filed an action against six hydrogen peroxide manufacturers," the company said. Kemira said it now had to get "acquainted" with the summons. Kemira - along with fellow European producers Evonik Industries, AkzoNobel, Solvay, Arkema and FMC Foret - were all named in the action brought by private antitrust enforcement firm CDC.
BASF TO PROVIDE BUILDING MATERIALS FOR MASDAR
German chemical giant BASF has formed a strategic partnership with Masdar to provide materials for the construction of an eco-city near Abu Dhabi, the United Arab Emirates. Masdar, an Abu-Dhabi-based renewable energy company, is building Masdar City, about 30km (19 miles) from Abu Dhabi. It will be the world's first carbon-neutral and zero-waste city, and is in its first stage of construction. BASF will offer materials that are suitable for sustainable and energy-efficient construction, such as polystyrene (PS) and polyurethane (PU).
DONGYING PLANS PLANTS
Dozens of chemical plants will be built in China's Dongying Port Economic Development Zone, in Shandong province, in the next five years under plans revealed by Feng Zhou, vice director of the Dongying Port Economic Development Zone Investment Promotion Bureau. "Dongying port has a good geographic advantage and plentiful fresh-water resources, very suitable for the production of chemical plants," he said. "We welcome companies to invest in Dongying and bring Dongying to a petrochemical hub."
CNOOC IN FEASIBILITY STUDY FOR NEW SITE
China National Offshore Oil Corp. (CNOOC) is conducting a feasibility study to build a new 12m tonne/year refinery and a 1m tonne/year cracker, said Ruifeng Chen, an engineer from China National Petroleum & Chemical Planning Institute. The petrochemical project in Dongying Port Economic Development Zone, in eastern Shandong province, would cost about yuan (CNY) 45bn ($6.58bn). Once started, the project is expected to come on stream during China's thirteenth five-year plan (2016-2020).
YINGUANG TO RESTART TDI UNIT IN SEPTEMBER
China's Gansu Yinguang plans to restart its 20,000 tonne/year toluene di-isocyanate (TDI) plant at Baiyin, in northwestern Gansu province, in around mid-September after raising its capacity to 50,000 tonnes/year, said a company source. The plant was shut down in mid-July for maintenance and expansion work. The company also pushed back the shutdown of its 30,000 tonne/year TDI line at the same site to the end of August from earlier in the month, as supply in the domestic market is tight. Yinguang also plans to expand the capacity of the second plant to 50,000 tonnes/year.
BLAST AT XINGTENG CHEMICAL KILLS ONE
An explosion at one of China-based Xingteng Chemical's hydrofluoric acid workshops in Jinhua city, Zhejiang province, has killed one worker and injured six, a company source said. Production was stopped immediately after the incident on August 18. "The main reason for the blast was a faulty process operation by one worker," the source said.
TAIWAN'S STYRENIC UNITS UP AFTER TYPHOON
Styrenic units in southern Taiwan have resumed production and are operating normally after brief shutdowns in the aftermath of Typhoon Morakot. Some units were shut for two to four days due to flooding, but supply was largely unaffected, according to producers. "Our expandable polystyrene [EPS] unit at Kaohsiung was closed for two days due to flooding," a producer said. The unit restarted and the supply of resins was not disrupted, he added.
KUMHO IDLES SBR UNIT AND CUTS OPERATIONS
Korea's Kumho Petrochemical has idled its new 110,000 tonne/year styrene butadiene rubber (SBR) plant until the end of October and cut production at some other units due to escalating feedstock butadiene (BD) costs, a company source said. The major synthetic rubber producer has cut the operating rates of its 370,000 tonne/year SBR and 222,000 tonne/year butadiene rubber (BR) plants to 60% due to an erosion in margins.
LIUGUO TO START BUILDING AMMONIA PLANT IN 2010
China's Liuguo Chemical is planning to begin construction of a 280,000 tonne/year synthesis ammonia plant in April 2010 in Tongling, said a company source. The yuan (CNY) 1.9bn ($278m) project, located in the eastern province of Anhui, is expected to come on stream in the second half of 2011. The new facility is expected to provide feedstock for its 1.12m tonne/year phosphorus fertilizer lines.
FORMOSA SHUTS DOWN AROMATICS ON FIRE
Taiwan's Formosa Chemical and Fibre Corp. (FCFC) shut its No. 3 aromatics line in Mailiao on the night of August 18, following a fire, company sources said. The fire broke out at one of the plant's utilities units, as FCFC was trying to restart the aromatics line, which had been shut since July, said one source. Another said that the fire was caused by overheating of the xylenes separation tower. The line can produce up to 700,000 tonnes/year of paraxylene (PX), 400,000 tonnes/year of benzene and 150,000 tonnes/year of orthoxylene (OX).
BASF KEEPS CRACKER IDLE
German chemical giant BASF will not restart the smaller of its two naphtha crackers at Ludwigshafen, Germany, until the company sees evidence of sustained recovery in demand, a company source said. BASF idled its Ludwigshafen No. 1 cracker, with an ethylene capacity of 220,000 tonnes/year, in mid-April, citing soft demand for ethylene and its coproducts.
CHEMICAL M&A DEALS SHRINK AMID RECESSION
Global chemical companies have turned away from large merger and acquisition (M&A) deals, as tight credit markets and the stressed global economy continue to inhibit major moves, global consultancy PricewaterhouseCoopers (PwC) said. While deal volume did pick up in the second quarter (Q2), the average transaction size fell to $72m (€50.4m), down from the $163m average seen in Q1. Overall, 187 deals were announced in Q2, a 15% improvement relative to 162 transactions in Q1, but significantly lower than the 2008 quarterly average of 223.
DUPONT CONSOLIDATES 23 BUSINESSES INTO 14
US-based chemical company DuPont has consolidated its 23 businesses into 14 and reshuffled senior leadership. "The company will sharply focus its innovation engines on four emerging trends to meet the increasing demand for food; protect people and the environment; decrease dependence on fossil fuels; and capitalize on the growth of emerging markets," the company said.
MONSANTO NEARS CROP TECH EXPLOSION - CEO
US agricultural firm Monsanto's research and development (R&D) pipeline is approaching a breakthrough on several projects that will improve yields for corn, soybeans and cotton, CEO Hugh Grant said. "We're on the verge of an unprecedented technology explosion that will deliver the types of products growers want most - those that offer greater yield and value," Grant said. "We have committed to using our technology to double yields in our three core crops - corn, soybeans and cotton - by 2030, while reducing our use of key resources by one-third per unit produced."
CARGILL REPORTS 69% DROP IN Q4 EARNINGS
US agribusiness major Cargill reported net earnings of $327m (€232m) in the fiscal 2009 fourth quarter ended May, down by 69% from $1.05bn in the same period a year ago. For the full fiscal year, Cargill had earnings of $3.33bn, a 16% decrease from a record $3.95bn the prior year. Revenues for the full year decreased by 3% to $116.6bn.
SINOFERT INCURS A FIRST-HALF NET LOSS
China's largest fertilizer distributor, Sinofert Holdings, has incurred a net loss of yuan (CNY) 828m ($121m) in the first half of 2009. The company's turnover fell by 44% to CNY12.5bn, while its sales volumes were down by 35% to 6.35m tonnes.
SABIC SEEKS HIGH-TEMP POLYCARBONATE BUYS
SABIC Innovative Plastics is looking for acquisition opportunities in high-end technologies to give polycarbonate (PC) better properties at very high temperatures. "We're also looking with SABIC at things like carbon fiber as they look to expand the product line," Charlie Crew, the SABIC business unit's president and CEO said.
LYONDELLBASELL TO CEASE BERRE, FRANCE SOLVENTS
LyondellBasell Industries will stop production of methyl isobutyl ketone (MIBK), acetone and isopropanol in Berre, France, at the end of September. The Netherlands-based company will continue to produce di-isobutylene at the site.
RUSSIAN RAILWAYS WINS $500M LOAN FROM EBRD
The European Bank for Reconstruction and Development (EBRD) has approved a $500m (€350m), 10-year loan to Russian Railways to allow the operator to complete a structural reform of its rail system. Russia, the rail network of which is second in size only to that of the US, aims to restructure freight operations and improve regulation.
AMCOR BIDS $2BN FOR PARTS OF ALCAN
Amcor has offered $2bn (€1.4bn) to acquire parts of global mining group Rio Tinto's Alcan Packaging business, the Australia-based international packaging firm said. The business units - Alcan Packaging Global Pharmaceuticals, Alcan Packaging Food Europe, Alcan Packaging Food Asia and Alcan Packaging Global Tobacco - generate $4.1bn/year in sales.
CHINA PROVINCE TO BUILD SIX CHEM ZONES
The municipal government of Jining city in China's Shandong province plans to invest yuan 65bn ($9.5bn) to build six chemical zones in three years. The six chemical zones would cover methanol, dimethyl ether (DME), acetic acid, formaldehyde, and formaldehyde-to-gasoline projects, as well as caustic soda, chlorine, and fine chemical processes.
BIAOXIN CHAIRMAN GETS 11 YEARS FOR POLLUTING
China Biaoxin Chemical Company's chairman, Hu Wenbiao, was sentenced to 11 years in jail for polluting a river in Yancheng city, in eastern Jiangsu province, the state-owned Xinhua news agency reported. Hu and production director Ding Yuesheng were convicted of discharging toxic wastewater into the river from November 2007 to February of 2009. The pollution left more than 200,000 people without water for three days in February of this year.
HEXION NARROWS ITS Q2 LOSS TO $71M
US producer Hexion Specialty Chemicals posted a second-quarter net loss of $71m (€50m), an improvement from a loss of $181m in the same period last year, and a 43% decline in sales to $947m, down from $1.67bn. The quarter included $66m in impairment and restructuring charges.
CHEMICAL M&A ACTIVITY LIKELY TO INCREASE
The global chemical merger and acquisition (M&A) market has likely bottomed, said Chris Cerimele, managing director and co-head of global chemicals at investment bank Lincoln International. "In the last two months, the level of discussions on chemical M&A has increased," he said. The expected avalanche of sales of distressed assets many were expecting failed to materialize in the first half, Cerimele added. "Lenders in the first half were a lot more willing to restructure existing debt and work with companies rather than push them into bankruptcy," Cerimele said.
JINGJIANG FANYOU BLAST KILLS FOUR, INJURES TWO
China-based Jingjiang Fanyou Fine Chemical Factory shut down production after a blast killed four people and injured two. Xinhua News Agency said a reactor at the company's sodium cyanate plant in Jingjiang city, Jiangsu province, exploded and caused a fire on August 13. Jingjiang Fanyou produces over 10,000 tonnes/year of potassium cyanide and sodium cyanide.
SHIN-ETSU TAKES FULL OWNERSHIP OF CIRES
Portugese PVC producer CIRES has become a wholly owned subsidiary of majority shareholder Japan's Shin-Etsu Chemical. Full ownership of CIRES and Netherlands-based Shin-Etsu PVC will strengthen its PVC business in Europe, Shin-Etsu said.
VALSPAR INCOME UP 38%
Valspar's third-quarter net income was up by 38% year on year at $65m (€46m), the US paints and coatings company said. Sales fell by 17% from the same period last year to $794.6m. "Our restructuring actions have improved the efficiency of our operations and we continue to improve our competitive position," said Valspar chairman and CEO William Mansfield.
DEBT DEALS MEAN RESTART FOR HIP PETROHEMIJA
Serbian petrochemial producer HIP Petrohemija will restart production in mid-September. The firm ceased production on June 24 after conceding that it could no longer afford feedstock. The reopening will be facilitated by debt repayment deals with two feedstock suppliers, Russia's Lukoil and Serbian refiner NIS, majority-owned by Russia's Gazprom.
BRASKEM TO INCREASE PE CAPACITY AT TRIUNFO
Brazil's Braskem will invest reais 10m ($5.4m) to increase the production capacity of recently incorporated Petroquimica Triunfo. The investment will add 12,000 tonnes/year of PE production capacity. The investment is also aimed at modernizing the plants at Triunfo industrial complex in southern Brazil.
JAPAN MOVES OUT OF RECESSION; GDP UP 0.9%
Japan has become the third G7 member to move out of recession after preliminary figures released last week showed the country's GDP grew by 0.9% in the second quarter. Japan's GDP had been contracting for five successive quarters. Germany and France also posted growth.
SHELL SELLS PV STAKE
Anglo-Dutch oil major Shell has sold its 50% stake in photovoltaic joint venture Avancis to partner Saint-Gobain of France. Shell said the move was part of its strategy to focus on alternative energies and technologies more in line with its core competencies.
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