This week's world news

16 August 2010 00:00  [Source: ICB]

DUPONT SEES SALES SLOWING IN SECOND HALF
DuPont expects 2010 second-half year-on-year sales growth to slow down from the 25% growth rate achieved in the first half, DuPont executive vice president Mark Vergnano said last Wednesday. Second-half sales growth will be lower because the first half compared with a weak 2009 first half. It would also be "seasonally smaller" because of its agricultural business. Overall, the US chemical company is on track for 15% year-on-year sales growth in 2010, above its targeted compounded annual growth rate of 10% from 2009 through 2012, Vergnano said.

EUROPE ACRYLATES HIT BY FM, TRIPLE-DIGIT INCREASES
Arkema of France has declared force majeure (FM) on ethyl acrylate in Europe, while another major producer, US-based Dow Chemical, announced a €250/tonne ($329/tonne) increase on all acrylates as of September 1. Arkema made the declaration on August 10 after troubles with waste disposal at its Carling, France, plant. Dow's price hike bid followed a similar announcement last Tuesday in the US to increase prices by 15 cents/lb ($331/tonne, €252/tonne). "I think some customers will be complaining about the increase, especially when most raw materials are declining," a Dow source said. "But the industry needs to recover its investments."

DOW ACRYLATES HIKES SHOCK US BUYERS
Dow Chemical announced hikes of 15 cents/lb ($331/tonne, €252/tonne) for several of its US acrylates and methacrylates on Tuesday, surprising buyers throughout the market. In a letter to customers, Dow said it planned to increase North American prices for some of its performance monomers because of strong global demand and long-term supply constraints stemming from a series of operational issues beginning in December 2009. "Dow is crazy," said one buyer. "There is no justification for this whatsoever, other than they want to make more money."

BASF STARTS BATTERY RESEARCH NETWORK
BASF and a number of academic partners have established an electrochemistry and batteries research network to look into the science and materials for new types of batteries, particularly those likely to be used in automobiles, the Germany-based chemical major said. In addition to the founding international academic members of the network, the company has 40 of its own research staff working on battery materials and technology, and it will be able to provide laboratory and scale-up facilities for further research, BASF said.

MEHR PLANS 2013 START-UP OF PARS PDH/PP PLANTS
Iran's Mehr PetroKimia plans to start up a new propane dehydrogenation (PDH) facility and polypropylene (PP) plant at Pars Special Economic Energy Zone, in Assalouyeh, in early 2013. After completion of the engineering phase in early 2010, the 450,000 tonne/year PDH facility is currently in the proprietary equipments supply and engineering procurement and construction (EPC) phase.

SUPREME DECLARES FORCE MAJEURE ON PS EXPORTS
India's Supreme Petrochem has declared force majeure on polystyrene (PS) exports from August 9 because of a partial halt in operations at Mumbai ports, where it ships material out of the country. "All our shipments for SM [styrene monomer] import as well as export of PS have been affected," Supreme said in a letter to customers dated August 10. Shipping traffic at the port terminals operated by the Jawaharlal Nehru Port Trust and Nhava Sheva International Container Terminal in Mumbai were suspended following a ship collision on August 7 which resulted in the spilling of oil and container cargoes into the Arabian sea.

SHANGHAI WUJING KEEPS ETAC UNIT SHUT ON MARGINS
China's Shanghai Wujing Chemical Co. is expected to keep its 200,000 tonne/year ethyl acetate (etac) plant shut down through September amid squeezed margins, a company official said. The plant was kept offline after a two-week turnaround in June given ample supply in the etac market, where competition was stiff, putting a strain on producers' ability to generate profit, the official noted. "We are unlikely to resume operations next month [September], considering the current market situation," the official said.

LURGI TO BUILD WORLD'S LARGEST POLYAMIDE PLANT
German engineering firm Lurgi, a unit of Air Liquide of France, said it had secured a contract to build the world's biggest polyamide 6 plant in Fujian, China with a 260 tonne/day capacity. The contract was awarded by Fujian Jinjiang, which manufactures high-end polyamide fiber for textile applications.

GNFC DELAYS START-UP OF NEW ETAC PLANT TO JAN
India's Gujarat Narmada Valley Fertilizers Co. (GNFC) has delayed the start-up its new 40,000 tonne/year ethyl acetate (etac) plant at Bharuch, Gujarat, to January next year from December 2010. "We will start up in January instead, it is just a normal delay," a company official said.

NO 2011 TURNAROUND FOR IDEMITSU KOSAN CRACKERS
Japan's Idemitsu Kosan has announced that it has no cracker maintenance plans in 2011. The company operates a 374,000 tonne/year cracker in Chiba, as well as a 623,000 tonne/year cracker in Tokuyama, based on ICIS data. "As of now, there are no plans for cracker maintenance next year," a company source said. "The crackers will keep running while the next major turnaround will be in 2012."

BRASKEM TO SPEND $180M ON SHUTDOWNS THIS YEAR
Brazilian petrochemicals major Braskem is expecting to spend a total of Brazilian reais (R) 317m ($180m) on maintenance shutdowns this year, CEO Bernardo Gradin said. Roughly R200m of that will be spent on a maintenance shutdown scheduled for November at Braskem's major basic petrochemicals plant in Camacari, in the northeastern state of Bahia.

BRASKEM UPS RESINS DEMAND PROJECTION
Brazil's petrochemical major Braskem has increased its 2010 forecast for growth in domestic demand for resins to 10% from 9%, the company's CEO said on Tuesday. The change would amount to 200,000 tonnes for a total of 4.7m tonnes in 2010/year, said Bernardo Gradin.

US JUNE MDI EXPORTS DROP 37% YEAR ON YEAR
US exports of methyl di-p-phenylene isocyanate (MDI) during the month of June were 1,158 tonnes, a 37% drop from 1,833 tonnes during the same month a year earlier, and 36% lower from 1,815 tonnes the previous month, according to US International Trade Commission (ITC) data released last Wednesday. US exports dropped as volumes to China, a key destination, fell from 825 tonnes in June 2009 to 382 tonnes in June 2010, the ITC said. For the year through June, however, MDI exports were higher by 22%, at 8,292 tonnes.

US EPA TO REQUIRE MORE REPORTING ON CHEMICALS
US environmental regulators will require more detailed and faster reporting of chemical production and refining data in 2011 and will put more limits on confidential business information. The Environmental Protection Agency (EPA) issued a proposed rule that would make multiple changes to reporting rules and definitions under the Toxic Substances Control Act, the principal US program for regulation of chemicals in commerce. The agency said that its proposed changes would expand the amount and type of information that refiners and chemical producers or importers would have to report and the frequency of those submissions.

CIAC: CANADA MUST BOOST CHEMICAL INDUSTRY
Canada must take steps to improve the competitiveness of its chemical industry, according to a strategy paper by the Chemistry Industry Association of Canada (CIAC) . It cited a number of "serious concerns" over the regulatory framework, feedstock availability, infrastructure and logistics, electricity prices, and finance issues that had hampered growth of domestic chemical production. Layers of duplicative and sometimes conflicting federal-provincial environmental regulations had discouraged potential investors, at a time during which manufacturing in central Canada and large parts of the US was eroding, the group said.

EVONIK Q2 NET PROFIT JUMPS ON RISE IN DEMAND
German specialty chemical firm Evonik Industries' second-quarter (Q2) net profit jumped to €240m ($316m), up from €89m in the year-ago period. Evonik's chemicals business reported a 37% year-on-year rise in sales during the second quarter to €3.29bn, while earnings before interest, tax, depreciation and amortization (EBITDA) rose by 61% to €657m. "In view of the good business trend we are far more optimistic about the outlook for the year as a whole than we were at the start of the year and have raised our forecast again," said chairman Klaus Engel.

HUNTSMAN SEES POLYURETHANES GROWTH
US chemical major Huntsman expects continued growth in its polyurethanes (PUs) business, driven by expanding demand for energy- efficient methyl di-p-phenylene isocyanate (MDI)-based products. Demand for Huntsman's MDI products in construction applications is growing despite the parlous state of the North American building industry, executives with the company said at the Jefferies Global Industrial and A&D Conference in New York. Huntsman said global MDI demand is expected to grow by around 8.5%/year from 2010-2015 - up from 7.2%/year from 1990-2007.

EXXONMOBIL CONFIRMS CRACKER PROJECT WITH QP
US-based ExxonMobil and Qatar Petroleum are still working to develop a worldscale petrochemical complex at Ras Laffan Industrial City, in Qatar, despite media reports that ExxonMobil had abandoned the project. ExxonMobil spokesman Jeffrey Neu quashed media speculation that the two companies had decided to end their plan to build the complex, which includes the world's largest steam cracker and polyethylene (PE) plants, as well as one of the world's largest ethylene glycol (EG) plants. The two companies first signed an agreement to start the project at the beginning of this year. "Specific details regarding the proposed project schedule, next steps and timing are considered confidential," said Neu.

LYONDELLBASELL NAMES VASNETSOV TO SVP ROLE
Netherlands-based chemical major LyondellBasell Industries has appointed former Sergey Vasnetsov as senior vice president of strategic planning and transactions. Vasnetsov previously worked as managing director and head of UK investment bank Barclays Capital's global chemical research group. Vasnetsov has been recognized as one of the leading chemical analysts by Institutional Investor magazine in annual surveys from 2000 through 2009.

REPSOL LIFTS FORCE MAJEURE ON ETHYLENE
Spanish energy and chemicals major Repsol has lifted the declaration of force majeure on ethylene and pyrolysis gasoline (pygas) supplies from its cracker at Sines, Portugal, with operations for all products running normally, a company source said. The company lifted the force majeure on August 5. Repsol shut down the 415,000 tonne/year ethylene cracker following a fire in the complex's terminal on July 27 and restarted it over the July 31-August 1 weekend. The company declared force majeure on ethylene and pygas on July 29.

SK ZHENBANG TO SHUT NINGBO PET PLANT
China's SK Zhenbang Chemical will shut its 150,000 tonne/year bottle-grade polyethylene terephthalate (PET) plant at Ningbo, Zhejiang province, on August 20 because of power cuts ahead of the peak summer season, a company source said. The planned shutdown will last for 15 days, the source added.

ALAER QINGSONG TO BUILD CAUSTIC SODA UNIT
China's Alaer Qingsong Chemical is expected to start building a 100,000 tonne/year caustic soda plant in northwestern Xinjiang province this month, a company source said. The firm, a subsidiary of Xinjiang Qingsong Building Materials and Chemical (Group), is planning to start up the plant by the end of 2011 to feed into the local market, the source said. The yuan 420m ($62m) project's capacity could eventually be expanded to 300,000 tonnes/year, the source added.

SHENHUA BAOTOU STARTS UP NEW MTO UNIT
China's Shenhua Baotou Coal Chemical started up its new 600,000 tonne/year methanol-to-olefins (MTO) plant in Baotou, northern Inner Mongolia, on Aug-ust 8, a source said. The MTO unit can produce 300,000 tonnes/year of ethylene and 300,000 tonnes/year of propylene. The ethylene and propylene will be used as feedstocks for the firm's polyethylene (PE) and polypropylene (PP) plants in Baotou, each with capacity of 300,000 tonnes/year, he added.

SINGAPORE POSTS JUMP IN Q2 PETCHEM EXPORTS
Singapore's petrochemical exports rose by 20.6% year on year in the second quarter of 2010, boosted by a continued pickup in global trade, the country's Ministry of Trade and Industry said. The city state exported Singapore dollars 14.0bn ($10.4bn) worth of chemicals and chemical products during April-June.

CHEMTURA'S $1BN EXIT FINANCING APPROVED
A US bankruptcy court approved Chemtura's proposal to line up $1.025bn (€769m) in exit financing for it to emerge from Chapter 11 bankruptcy protection. Chemtura aims to line up the financing before the US Labor Day holiday, since it has typically been more difficult to arrange bankruptcy financing later in the year. Chemtura would deposit the proceeds from the financing into an escrow account, where they would remain until the court confirms the company's reorganization plan. A confirmation hearing is scheduled for September 16.

By: Joseph Chang
+1 713 525 2653

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