The world this week

08 February 2013 09:55  [Source: ICB]

AMERICAS

RIO TINTO HALTS PLANS FOR TIO2 FEEDSTOCKS IN CANADA
Rio Tinto has halted plans for a facility to produce titanium dioxide (TiO2) feedstocks at Becancour in Canada's Quebec province, the Anglo-Australian mining major said. Rio Tinto's TiO2 business unit, Rio Tinto Iron & Titanium said that a study showed that weak market conditions made the project economically unviable. The company and Quebec government ministers had announced plans for the greenfield project, with a potential investment of around $4bn (€3bn), in June last year.

CARLYLE COMPLETES $4.9BN DUPONT COATINGS BUYOUT

US alternative asset manager The Carlyle Group has finalised its acquisition of DuPont Performance Coatings for $4.9 bn ($3.6bn). The acquired company, a global supplier of coatings to the transportation and industrial sectors, would be renamed Axalta Coating Systems. The purchase from DuPont was funded primarily with equity from the Carlyle Partners V and Carlyle Europe Partners III funds.

DOW REPORTS SHUTDOWN OF LOUISIANA CRACKER
Dow Chemical reported a shutdown of a cracker at its Plaquemine site in Lousiana on 2 February. A filing with the National Response Center said the shutdown was caused by a cracked tubing line, which resulted in the release of crack gas containing multiple olefins and aromatics. The filing did not specify which cracker at the site was shut down, nor if the cracker has been restarted. Dow has two crackers at the site with a combined ethylene capacity of 1.257m tonnes/year.

AMERICAS STYRENICS CONFIRMS TURNAROUND
Americas Styrenics confirmed that one of the styrene units at its St James facility in Louisiana will be offline for a maintenance turnaround for most of February. The company said it started the turnaround at the beginning of February. The St James facility has a combined styrene capacity of 950,000 tonnes/year.

MAGELLAN MIDSTREAM TO BUILD AT TEXAS TERMINAL
US pipeline operator Magellan Midstream Partners plans to build new pipeline infrastructure at its Galena Park, Texas, terminal to originate crude oil to the company's Gulf coast distribution system for delivery to refineries in the Houston and Texas City area, the company announced. The project, estimated to cost approximately $50m (€37m), is supported by long-term committed volumes and is expected to be fully operational by mid-2014. Headquartered in Tulsa, Oklahoma, Magellan Midstream Partners primarily transports, stores and distributes petroleum products.

BRAZIL LAUNCHES EPOXY RESINS ADD INVESTIGATION
Brazil has launched an anti-dumping duty (ADD) investigation against six countries it suspects may have been dumping liquid epoxy resins (LER) in Brazil, an epoxy resins producer said. The proposed ADDs are 31.9% for LER from South Korea, 2.1% for Saudi Arabia, 6.6% for Mexico, 38.6% for China, 13.3% for India and 40.3% for Taiwan. The period under investigation by the Brazilian Secretariat of Foreign Trade for the analysis of dumping runs from April 2011 to March 2012 and from April 2007 to March 2012 for the analysis of injury. The investigation was requested by Dow Sudeste Industrial.

US DECEMBER CHEMICAL SHIPMENTS RISE 12.7%
The value of US-made chemical shipments in December posted another small increase year on year, with the petrochemicals sector gaining by 12.7%, according to data released by the US Department of Commerce. The value of US land and water chemical shipments totalled $62.71bn (€45.78bn) in December, up by 1.4% compared with $61.86bn a year earlier. The largest chemical sector tracked by the census - petrochemicals - rose again, with shipments in December totalling $43.0bn, compared with $38.17bn in the same month of 2011.

BRAZIL CHEM PRODUCTION STAGNANT IN LAST 6 YEARS
The Brazilian chemical industry has been stagnant for six years, despite a preliminary quantum index's indication that production and sales increased in 2012, the nation's industry chemical group Abiquim said. Sales of industrial chemicals in 2012 increased 7.43% year on year, while chemical production rose 2.89%, according to the quantum index, which is based on quantity units of goods, such as number or weight. However, Abiquim said production and domestic sales have been stagnated for six years as a result of lack of competitiveness. The trade industry association said the results were influenced by power outages.

PLASTICS PRODUCTION IN BRAZIL FALLS 0.4% IN 2012
Brazil's plastics production decreased last year by 0.4% compared with 2011, the Brazil Plastics Industry Association (Abiplast) said, citing a downturn in some segments of the plastic sector. Abiplast pointed to a slump in the production of plastic laminates in particular, which was down by 6.7%, while production of plastic packaging increased slightly by 0.4%. Plastics production in December fell by 12.6% compared with the previous month, the group said. The drop was due to a downturn in all segments of the plastic sector.

EUROPE

STRIKE COMES TO AN END AT SABIC'S GELEEN SITE
A strike at the Geleen site operated by Saudi Arabian petrochemicals major SABIC in the Netherlands has ended, the union representing workers at the site said on 5 February. According to Netherlands trade union FNV Bondgenoten, the strike was called off by union members despite being unable to come to an agreement on proposed revisions to the employee collective labour agreement.

INEOS VAM PLANT BACK UP AFTER TECHNICAL PROBLEM
INEOS's vinyl acetate monomer (VAM) plant in Hull, UK, is operating after technical problems which led to force majeure being declared, a company spokesman said. The spokesperson did not comment on whether the force majeure, declared on VAM supplies from the 300,000 tonne/year plant in late December, was still in place.

REACH LEGISLATION 'HAS REDUCED COMPETITIVENESS'
The European Commission has said the introduction of Reach chemical legislation has impacted on the market concentration and pricing of some chemicals in ­Europe. According to a new report on the legislation, the cost of Reach registration has discouraged some companies from ­competing in the production of certain chemicals, which may have resulted in greater market concentration.

CIECH EXTENDS BID DEADLINE FOR RESINS UNIT
Polish company Ciech has extended the deadline for bids for epoxy and polyester resins subsidiary Zaklady Chemiczne Organika-Sarzyna to 18 February from the end of January. The company was progressing in talks with potential bidders but none of the parties was yet ready to submit a binding offer, a source said.

PERSTORP TO SIGN NEW DEAL WITH RESCHEM ITALIA
Perstorp announced it will sign a new deal with distributor Reschem Italia to sell several of the Swedish specialty chemicals producer's non-coating applications in the Italian market in 2013. Reschem Italia will market various products in the Perstorp range, including polyalcohols, organic acids, caprolactones and specialty polymer.

LYONDELLBASELL SET TO REORGANISE IN EUROPE
LyondellBasell is talking to employee representatives (works councils) in Europe about further reorganisation. The latest cutbacks are likely to be made in manufacturing and in research and development (R&D) operations, earlier cuts having come in the commercial functions.

THE NETHERLANDS' BRCS BUYS AUSTRIA'S CHEMRES
Netherlands-based chemical distributor BRCS Group has acquired Austria's Chemres for an undisclosed sum. BRCS CEO Hidde van der Wal said the acquisition gives the company direct access to customers in Austria. BRCS Group is a 50:50 joint venture between chemical materials providers Barentz and Ravago, which was formed at the end of 2011.

FRENCH GOVT MAY TAKE STAKE IN PETROPLUS
The French government may take a minority stake in the Petroplus refinery at Petit-Couronne, near Rouen in northwest France, to facilitate the plant's sale. Arnaud Montebourg, minister for industrial renewal, said in a televised briefing that the government could take the stake to facilitate the purchase of the refinery by a foreign investor.

EU, EUROZONE DEC CHEM PRODUCER PRICES UP 0.2%
The December 2012 chemicals producer price index increased by 0.2% month on month in both the EU and the eurozone, statistics agency Eurostat said. December's positive figures mark a return to growth for chemicals following a decline in November of 0.6% in the EU and 0.8% in the 17-member eurozone.

SYNGENTA 2012 NET INCOME RISES BY 17%, SALES UP 7%
Switzerland-based agribusiness group Syngenta's net income for the full year in 2012 increased by 17% year on year to $1.9bn (€1.4bn), backed by increased sales of 7%. The group's sales rose to $14.2bn, up from $13.3bn in 2011. Its sales volume rose by 7% year on year, while prices edged up by 3%.

ASIA

MITSUI PLANS TO EXIT KEIYO ETHYLENE BY MARCH 2015
Japan's Mitsui Chemicals is planning to withdraw from the business operations of its Keiyo Ethylene joint venture by end-March 2015, as part of its restructuring efforts, the producer said. Keiyo Ethylene, which produces 768,000 tonnes/year of ethylene, is a joint venture between Mitsui Chemicals, Maruzen Petrochemical and Sumitomo Chemical. The improvement in ethylene supply from new large-scale plants in the Middle East and China as well as the forecasted production growth from shale gas in the US has resulted in an "urgent need to fundamentally restructure and reform domestic petrochemical business for industry sustainability," the company said.

ADM NOT TALKING TO GRAINCORP ABOUT BID
Archer Daniels Midland (ADM) is currently not talking to Australia's GrainCorp about ADM's takeover offer, the CEO of the US-based agribusiness major said. In fact, ADM has not been talking to the Syndey-based grain handling, oils and agricultural company since last December, when GrainCorp rejected ADM's latest offer, CEO Patricia Woertz told analysts during ADM's second-quarter results conference call. GrainCorp in December rejected ADM's cash bid of Australian dollar (A$) 12.20/share - worth around $3bn ($3bn, €2bn) - as too low. But GrainCorp indicated at the time that it remained open to a higher bid.

MARKOR TO START BUILDING PROJECT IN MARCH
China's Markor Chemical, a subsidiary of Markor Group, plans to start building an integrated coal-based fine chemical industries project at Xinjiang in March, a company source said. The project, which will cost yuan (CNY) 13bn ($2.1bn), includes a 100,000 tonne/year 1,4-butanediol (BDO) unit, a 50,000 tonne/year polytetramethylene ether glycol (PTMEG) unit, a 400,000 tonne/year monoethylene glycol (MEG) unit, and a 60,000 tonne/year polyformaldehyde unit, the source said. The company has already completed preliminary works including initial design, environmental assessment and has won approval from National Development and Reform Commission (NDRC), the source added.

UBE TO END CAPROLACTAM PRODUCTION AT SAKAI
Japanese chemical producer Ube Industries plans to end the production of caprolactam and its derivatives at its Sakai factory in Osaka, Japan, by the end of March 2014, the company said. The producer will permanently stop production at the 100,000 tonne/year caprolactam plant because the caprolactam business has become less profitable, Ube said in a statement. Other plants at Sakai to terminate production include 200,000 tonne/year ammonia, 99,000 tonne/year liquefied carbon dioxide, 160,000 tonne/year ammonia sulphate and 5,000 tonne/year 1,5 hexanediol.

MITSUI CHEMICALS PLANS OCT MIBK PLANT OVERHAUL
Japan's Mitsui Chemicals plans to shut its 30,000 tonne/year methyl isobutyl ketone (MIBK) plant at Iwakuni-Ohtake Works in Yamaguchi prefecture in October for annual maintenance, said a company official. The plant will be taken off line from October to mid-November for around one-and-a-half months, the official said. Mitsui Chemicals' MIBK plant was last shut for overhaul between 2 October and 22 November 2012. Mitsui Chemicals is the largest of three MIBK makers in Japan.

SINOPEC ANQING ACHIEVES ON-SPEC ACN AT NEW PLANT
China's Sinopec Anqing Company has achieved on-spec product at its new 130,000 tonne/year acrylonitrile (ACN) plant on 2 February in Anqing city of Anhui province, a company source said. The plant started up in the end of January and was put into production on 31 January 2013, the source said. The company earlier expected that on-spec products will be achieved by end January 2013, according to an earlier report. The company has another ACN plant with capacity of 80,000 tonnes/year at present, and also has downstream 70,000 tonnes/year acrylic fiber (AF) plant at the same site, the source said.

TEIJIN, SK CHEMICALS TO SET UP PPS RESINS JV
Japan's Teijin Chemicals and South Korean producer SK Chemicals are establishing a joint venture in July this year to build a new polyphenylene sulfide (PPS) resins plant in Ulsan, Teijin said. The new plant will begin operations with a PPS resin annual production capacity of 12,000 tonnes/year starting in April 2015, it said in a statement. The plant's capacity is expected to be boosted to 20,000 tonnes/year "as demand grows", it said. The joint venture, in which Teijin Chemicals will hold a 34% share and SK Chemicals the remaining 66%, will develop, produce and distribute PPS resins.

US, EUROPE BG MAKERS LOWER CHINA ALLOCATIONS
US and European butyl glycol producers plan to cut supply allocations to China, which has started charging up to 18.8% antidumping duty (ADD) on their products, with some diverting cargoes to southeast Asia, industry sources said. "We are planning to cut butyl glycol allocations to China by about 20-30%...China will be the last choice for us," said a key US-based producer. US-based producers like Dow Chemical and Eastman are all planning to reduce allocation from the US, and plan to sell outside of China in southeast Asia and India, said traders and producers.

JIANGSU LIANHAI TO SHUT ETAC PLANT FOR HOLIDAY
China's Jiangsu Lianhai Biological Technology plans to shut its 100,000 tonne/year ethyl acetate (etac) plant at Nantong in Jiangsu province over the Lunar New Year holiday, a source close to the company said. The planned shutdown on 7-15 February is aimed at curtailing the producer's excess etac output and no maintenance will be carried out, the source added. Its plan to boost capacity by 150% to 250,000 tonnes/year is expected to be completed in the second quarter of 2013, the source added.


Author: William Beacham



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