This week's world news

03 October 2011 00:00  [Source: ICB]

AMERICAS

DOW, K2 PURE OPEN US CHLOR-ALKALI PLANT
US-based Dow Chemical and chlorine producer K2 Pure Solutions have opened a chlor-alkali plant at Dow's Pittsburg site in California. The plant, which K2 Pure built and operates, will produce bleach for municipal water-treatment facilities in northern California. It will also supply Dow's Pittsburg site with chlorine for the manufacture of crop protection products and other materials. Dow is also leasing a K2 Pure-operated facility, to ­generate chlorine for use by Dow via pipeline. The plants have a combined chlor-alkali products capacity of about 209,000 tonnes/year.

AMYRIS AND MICHELIN TO DEVELOP BIO-ISOPRENE
US renewable chemicals firm Amyris and French tire maker Michelin have agreed to develop and market renewable isoprene. Under the agreement, the two companies will contribute funding and technical resources to develop Amyris' technology to produce isoprene from renewable feedstocks. Michelin is also "committed to off-take volumes on a ten-year basis." The agreement will allow Amyris to market its renewable isoprene to other customers. Amyris expects to market renewable isoprene for use in tires and specialty applications such as adhesives, coatings and sealants.

US COURT APPROVES $33M HUNTSMAN SETTLEMENT
A US court has approved Houston, Texas-based chemical firm Huntsman's proposal to pay $33m (€24m) to settle a class-action lawsuit that accused the company of fixing prices on isocyanates and other feedstocks for polyurethane (PU) foam. The court also approved a settlement under which Netherlands-based chemical major LyondellBasell will pay nothing. The lawsuit, filed in 2004, accused chemical producers Huntsman, Bayer, BASF, Dow Chemical and LyondellBasell of fixing prices. The complaint covered propylene oxide (PO)-based polyether ­polyols, methyl di-p-phenylene isocyanate (MDI) and toluene ­di-isocyanate (TDI) purchased from January 1, 1999, through ­December 31, 2004.

COCA-COLA UPBEAT ABOUT BIO-BASED BOTTLE
The development of new shale gas fields in the US will not weaken US beverage giant Coca-Cola's commitment to bio-based packaging, the company's sustainable packaging director, Scott Vitters, said at the 2011 Pack Expo in Las Vegas, Nevada, US. While the promise of plentiful feedstocks could have a short-term positive impact on market volatility, it will not address the reality of growing competition for resources in the developing world, he said. "There are a lot of interesting things happening with shale gas, but there is also a lot of growth in the polyester industry in China," Vitters said. Coca-Cola is still on target to produce a 100% bio-based polyethylene terephthalate (PET) bottle by 2020, he added.

MOODY'S UPGRADES WESTLAKE CHEMICAL
Global credit ratings agency Moody's has upgraded its ratings for US-based Westlake Chemical to Baa3 from Ba1. Moody's said the upgrade reflects Westlake's access to advantaged feedstocks and its improved profitability. The company's "large cash balance" will be sustainable, despite a significant increase in its capital spending to build a new chlor-alkali plant and to expand ethylene plant capacities in the few years, Moody's added.

C&D, FMC, TATA FORM NATRONX PARTNERSHIP
US inorganics producers Church & Dwight, FMC and TATA Chemicals (Soda Ash) Partners have signed a definitive agreement to form a partnership to manufacture and market sodium-based, dry sorbents. The product will be used in air pollution control, ­electricity utility and industrial boiler operations. The sorbents, primarily sodium bicarbonate and trona, are used by coal-fired utilities to remove harmful ­pollutants such as acid gases in flue gas treatment processes. ­Independent estimates put market demand for these sorbents in the $200m-400m (€145m-294m) range by 2015, Church & Dwight noted. The new corporate entity, Natronx Technologies, will be headquartered in Princeton, New Jersey, US.

GEVO GIVEN A $5M GRANT TO DEVELOP JET FUEL
US-based bio-isobutanol producer Gevo has received a $5m (€4m) government grant to develop jet fuel using cellulose-based isobutanol (IBA). The grant was among $40m the US Department of ­Agriculture gave to the Northwest Advanced Renewables Alliance - a consortium led by Washington State University, Gevo said. The company will use its portion of the award to improve its ­cellulosic yeast and fermentation process. Under the grant, Gevo will rely on woody biomass and forest-product residues as a ­feedstock. By 2013, it expects its new jet fuel to be fully certified by the American Society for Testing and Materials.

AUGUST DURABLE GOODS ORDERS FALL 0.1% IN US
New orders for US durable goods fell by 0.1% from July in August, as a 23.5% jump in airliner purchases failed to lift the overall average into positive territory, the US Commerce Department said. In its monthly report, the department said new orders for durable goods had fallen by $200m (€148m) - or 0.1% - to $201.8bn in August, the second drop in three months. Durable goods are manufactured products meant to last three years or more, including such items as autos, electrical appliances and transportation and manufacturing equipment, among others.

US AUGUST CHLOR-ALKALI RATE HITS 87%
The US chlor-alkali production rate for August was 87%, up 2 percentage points from the July figure, according to US trade group The Chlorine Institute. August industry chlor-alkali output was 992,371 short tons (900,263 tonnes) of chlorine and 1.04m tons of caustic soda. The July chlor-alkali operating rate stood at 85%. Market participants said demand for US chlorine will drop in the fourth quarter, and caustic soda supply will tighten. One distributor said the August rate figures were as expected, given fewer production issues that month than in July.

 

EUROPE

HUNTSMAN IN TEXTILE CHEMS RESTRUCTURING
US-based chemical firm Huntsman is planning a "significant restructuring" of its textile chemicals business in Switzerland, including the possible closure of production facilities, up to 500 job cuts and the loss of 100 positions at other Huntsman sites. The restructuring, which had been expected, is the company's response to competitive market pressure in textile chemicals, as well as an attempt to offset the strong Swiss franc, which has hurt Huntsman's operations in Switzerland, the company said.

CAZENOVE CUTS EUROPE CHEMICAL FORECASTS
UK-based investment bank J.P. Morgan Cazenove has lowered its earnings forecasts for Europe's chemical industry, citing the economic slowdown in the eurozone and the US. "The increasing risk to US and European ­economic growth has led us to lower our earnings forecasts by an average of 6% for 2011 and 16% for 2012," the firm said. The revised figures reflect "a central case of mild economic contraction in the US and eurozone" - translating into a 1.5% cut in the bank's 2012 volume growth ­forecasts, as well as softer pricing. The firm said it does not expect demand to collapse to the level of the 2008-2009 financial crisis, and that its forecasts for 2012 ­remain significantly more optimistic.

SOLVAY TO SHUT ECH PLANT FOR MAINTENANCE
Belgium-based chemicals producer Solvay will shut its 60,000 tonne/year epichlorohydrin (ECH) plant in Rheinberg, Germany, for one week of planned maintenance in October. "This is a planned stoppage and it will not affect the market, as we have stocked up enough material for the duration of the shutdown," a source said. The exact date of the shutdown was not confirmed.

MIKHELSON GIVEN RUBBER STAMP FOR SIBUR BUYOUT
Russian entrepreneur Leonard Mikhelson has received official permission to proceed with the full takeover of Russian petrochemical major SIBUR, a company official said. Mikhelson, who already holds a 50.2% stake in SIBUR, had his plans rubber-stamped by the country's federal anti-monopoly authority, the official told ICIS. The billionaire, who is also CEO of Russian gas producer Novatek, said he plans to take SIBUR through an initial public offering within the next two years. The official said that those plans have not changed, but she declined to give a timetable for Mikhelson's purchase of the remaining SIBUR shares from Russia's Gazprombank.

MELROB COMPLETES JAPAN INTEGRATION, REBRANDS
UK-headquartered specialty ­distributor Melrob has completed the integration of Japanese firm Chemiplus, which it acquired in March. From October 1 the merged company in Japan will operate as Melrob-Chemiplus.

 

ASIA

SHELL SHUTS UNITS AT SINGAPORE REFINERY
A fire at Shell's refinery on Bukom Island in Singapore was contained, the global chemical giant said on Wednesday, September 28. The fire led to the shutdown of some units. The company's integrated complex at Bukom has a crude distillation capacity of 500,000 bbl/day and is Shell's largest facility. The fire began at 13:15 Singapore time on September 28. The site houses a mixed-feed cracker with 800,000 tonnes/year ethylene capacity and a 155,000 tonne/year butadiene (BD) extraction unit.

SHANGHAI SECCO RESTARTS 1.2M TONNE CRACKER
China's Shanghai SECCO Petrochemical has successfully resumed operations at its 1.2m tonne/year naphtha cracker, market sources said. The cracker - China's single-largest ethylene plant - and its downstream units were shut late on September 8, following a blast at an olefins pipeline at the petrochemical site in the Jinshan district of Shanghai. Shanghai SECCO's derivative plants are also expected to be up and running once cracker operations are stabilized, market sources said. These include a 300,000 tonne/year linear low density polyethylene (LLDPE) plant, a 300,000 tonne/year high density polyethylene (HDPE) unit and a 250,000 tonne/year polypropylene (PP) plant.

FORMOSA RUNS MAILIAO PVC UNIT AT 70%
Taiwan's Formosa Plastics Corp. (FPC) has been running its 500,000 tonne/year polyvinyl chloride (PVC) plant in Mailiao at about 70% of capacity since ­restarting it last week, a company source said on Wednesday, ­September 28. The facility was shut on September 12 for scheduled maintenance. However, the ­producer cannot ramp up the operation rate to 100%, as its downstream 800,000 tonne/year vinyl chloride monomer (VCM) unit, located in the same area, is still undergoing a turnaround which will last until early October, the source added.

XINGDA GROUP TO BUILD EPS UNITS IN CHINA
China's Xingda Group is planning to build two 120,000 tonne/year expandable polystyrene (EPS) plants - one each in Northwest and Northeast China, a company source said. The company is building the plants to meet the rising demand for EPS in the regions, as part of its exploration of new markets in China, the source added. The group is to build one plant at Karamay, Xinjiang province, aiming to start commercial operations in the fourth quarter of this year. The second EPS plant will be built at Daqing, Heilongjiang province, and is expected to be on stream in July 2012, the source said.

CSPC SHUTS HUIZHOU CRACKER ON TECH ISSUES
China's CNOOC & Shell Petrochemicals Co. (CSPC) shut its 950,000 tonne/year naphtha cracker at Huizhou, Guangdong province, on September 26, because of technical issues, sources familiar with the company said. It is unclear how long the cracker will remain shut. The company, CSPC is a 50:50 joint venture ­between the China National Offshore Oil Corp. (CNOOC) and Shell Petrochemical, a member of the Shell group, shut its ­derivative operations as well, the sources said. Company officials could not be immediately reached for comment. CSPC shut its 700,000 tonne/year styrene monomer (SM) unit on the same day as the cracker, some market ­players added.

AND SHUTS DOWN HUIZHOU BENZENE UNIT
China's CNOOC & Shell Petrochemicals Co (CSPC) shut its 240,000 tonne/year benzene unit at Huizhou, Guangdong province, on September 26, a company source said. CSPC shut the unit in line with the shutdown of the company's upstream cracker at the same site, because of mechanical problems. The shutdown is expected to last 10-20 days. The company took its downstream 700,000 tonne/year styrene ­monomer (SM) unit at the same site off line because of a feedstock shortage from the benzene plant, the source added.

DSM NANJING TO START UP CAPRO PLANT IN Q3 2013
China's DSM Nanjing Chemical is planning to start up a 200,000 tonne/year caprolactam (capro) plant at Nanjing, Jiangsu province, by the third quarter of 2013. DSM Nanjing started building the $300m (€220m) plant on September 26, according to a statement from China-based chemical giant Sinopec, which owns part of the company. The plant is expected to reach full capacity by 2014.

INDORAMA VENTURES SHUTS PET PLANTS
Thailand-based Indorama Ventures Limited shut operations at its wool yarns and polyethylene terephthalate (PET) polymers facilities in Lopburi, Thailand, on Tuesday, September 27, because of flooding. The site houses a facility with 29,132 spindles, producing about 6,000 tonnes/year of worsted wool yarns, depending on the product mix. It also has an 180,000 tonne/year PET plant in Lopburi, as well as a packaging facility that can annually produce 600m preforms, 180m bottles and 1.2bn closures, the company's website states. No restart date was set for the plants.

PERTAMINA EYES NEW PROPYLENE UNIT START-UP
Indonesian state-owned refiner Pertamina is targeting start up for its new 178,000 tonne/year propylene facility at Balongan, West Java, in late October, a source close to the company said. "The company will try and start up the ROPP [RCC (residual catalytic cracking) off-gas to propylene] unit around October 27, and will hopefully have commercial operation in early November," the source said. The company had earlier delayed the start-up to early November because of a mechanical fault.

XIN YUE TO RESTART THIRD ECH LINE IN OCTOBER
China's Xin Yue Chemicals plans to restart a third line at its epichlorohydrin (ECH) plant in Shandong province during the week of October 10, after the week-long holidays in China, a company source said. The firm decided to resume production at the 35,000 tonne/year ECH line as product prices are on the rise, the source added. The Chinese market will be closed for the celebration of its National Day from October 1-7. Xin Yue Chemicals has two other ECH lines - with a combined capacity of 60,000 tonnes/year - at the site. The two lines are currently running at 60% of capacity, the source said, adding that production rates will pick up gradually.

TOYOTA OUTPUT RISES FOR FIRST TIME IN 12 MONTHS
Japan's Toyota Motor said its global output of vehicles rose by 10.6% year on year to 626,817 units in August - the first monthly increase in 12 months. Toyota, Asia's largest automaker, was beset by a serious parts shortage in the wake of the March 11 ­earthquake and tsunami, that ­disrupted its domestic supply chain. Toyota's overseas production of vehicles rose by 9.8% year on year to 374,443 units in August this year, because of increased production in South Africa, Australia, Asia and Europe. Its domestic output of vehicles rose by 11.9% year on year to 252,374 units in August, while exports increased by 19.8% to 137,977 units.

ASAHI KASEI RUNS MMA PLANT AT 70%
Japan's Asahi Kasei is running its 100,000 tonne/year methyl methacrylate (MMA) plant at 70% of capacity, after facing mechanical problems during a restart, a company source said. The producer is likely to resume full operating rates at the plant around October 7, after the mechanical issues are resolved. The unit in Kawasaki was restarted on September 22.

 

MIDDLE EAST & AFRICA

PIC TO SHUT 820,000 TONNE/YEAR PX UNIT
Kuwait's Petrochemical Industries Company is planning a three-week turnaround from October 19 at its 820,000 tonne/year paraxylene (PX) unit at Shuaiba because of a persistent mechanical glitch, a company source said. The aromatics plant is running at a reduced operating rate of 80%. The turnaround is not expected to affect PX supply in Asia as this is a scheduled shutdown, market sources said.

IRAN PETROCHEMICAL DECLARES FM ON PX
Iran Petrochemical Commercial Company (IPCC) shut its 700,000 tonne/year paraxylene (PX) unit in Asaluyeh on September 27, because of a mechanical problem, prompting it to declare a force majeure on supply from the plant, a company source said. The force majeure will be in place until to mid-October, the source added, although no definite restart date has been set for the PX unit. Prior to the shutdown the unit was running at 40% of capacity.

SASOL POLYMERS TO RESTART PLANTS
South Africa's Sasol Polymers will restart its olefins and polymer plants on October 12, a ­company source said. The plants, at two local sites - Secunda and Sasolburg - were shut down in the week ending September 23, for a three-week annual scheduled maintenance. The source denied any direct link with the explosion late last month at its Secunda site. The source went on to further deny rumors that any shortage of low density polyethylene (LDPE) and linear low ­density polyethylene (LLDPE) has been caused by the Secunda facility explosion.


By: Joseph Chang
+1 713 525 2653



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