News in brief

01 March 2013 09:06  [Source: ICB]

EUROPE

GLOBAL PRODUCTION TO GROW 3.6% IN 2013 - BASF
BASF's CEO Kurt Bock said global chemicals production, excluding pharmaceuticals products, is likely to grow by 3.6% in 2013 compared with 2.6% in 2012, driven by a stronger performance from emerging market economies. The figure would rebound to close to the levels seen in 2011, when worldwide chemical production growth stood at 3.8%.

GERMAN INDUSTRY WELCOMES BERLIN MOVE
Germany's top industry trade group, BDI, has welcomed plans by the country's federal government to prepare rules for hydraulic fracturing (fracking), the controversial technology used in the exploration and production of shale gas. The challenges posed by Germany's energy policies - with an exit from nuclear power generation by 2022 - made it necessary to look at new energy supplies, including domestic shale gas resources, said Markus Kerber, general manager of BDI. German chemical producers trade group VCI is a member of BDI.

COMPLIANCE ISSUES FOR 'LARGE PART' OF REACH
A significant proportion of registrations submitted under the Reach chemicals legislation raise compliance concerns, Finland-based body the European Chemicals Agency (ECHA) said. According to the agency's 2012 progress report on evaluation under the Reach legislation, the ECHA was able to close the books on just 33% of the 354 compliance checks that it carried out during 2012. Insufficient information on subject identity was the most common shortcoming with registrations, the report said.

BOREALIS Q4 2012 NET PROFITS UP 72% AT €100M
Borealis's fourth-quarter 2012 net profits were 72% higher at €100m on 18% higher sales at €1.87bn. The Austria-headquartered plastics, chemicals and fertilizer producer said full-year 2012 net profits had fallen by 5% to €480m largely because of the weaker polyolefins margin environment in Europe. Full-year 2012 sales were up 6% at €7.55bn.

HUNGARY'S MOL SUFFERS Q4 LOSS OF FT3.4BN
Hungarian group MOL said its petrochemical division saw a forint (Ft) 3.4bn ($15.1m) operating loss in the fourth quarter of 2012 against its restated Ft8.3m operating loss in the same period a year before. Petrochemical sales volumes fell by 9% year on year to 328,000 tonnes, with sales volumes of olefins and polyolefin down by 14% to 72,000 tonnes and 7% lower at 256,000 tonnes respectively.

UK'S CRODA Q4 OPERATING PROFIT RISES BY 5.1%
Croda International reported a 5.1% year-on-year increase in its fourth-quarter operating profit to £61.9m on higher sales in all of its business segments. The UK-based specialty chemicals firm posted a 2.2% year-on-year rise in its fourth-quarter sales to £240.1m. For the full year of 2012, its operating profit grew by 7.4% to £255.4m, with sales reaching £1.05bn, up by 2.3%.

HUNGARY'S TVK CUTS Q4 NET LOSS TO FT581M
TVK cut its net loss to forint (Ft) 581m ($2.6m) in the fourth quarter of 2012 from Ft8.45bn in the same quarter of the previous year on the back of improved margins. The Hungarian petrochemical producer also reported that its sales revenues improved by 3.4% year on year to Ft100.3bn.

OXEA'S Q4 NET INCOME UP BY 56% ON HIGHER SALES
Oxea's fourth-quarter 2012 net income rose by 56% to €14.4m, due to a higher operating profit and lower net financial expense. The global oxo chemicals firm said net sales for the three months ended 31 December 2012 were €342.9m, an increase of 4.4% compared with the corresponding period of the prior year, as overall volumes grew by 2.6%. Oxo Intermediates volumes were up by 1.7% and Oxo Derivatives volumes traded 5.9% higher.

CLARIFICATION
In the 18 February 2013 issue of ICIS Chemical Business, page 23, we stated that Romania's Oltchim had halted production of polyols. The company wants to make it clear that production was stopped for two days in February, and has returned to low levels of capacity utilisation since then.

AMERICAS

HUNTSMAN DELAYS TEXAS CRACKER RESTART

An equipment failure disrupted US chemical producer Huntsman's attempt to restart its 193,000 tonne/year Port Neches cracker in Texas. A market participant said the company had planned to restart the cracker early in the week of 25 February, but difficulties pushed the restart to the end of the week or early the next week. A filing said the cracker's A3 unit experienced equipment problems during the restart, resulting in emissions of ethylene, propylene and other materials.

LYONDELLBASELL TO RELOCATE US R&D TO TEXAS
Chemical major LyondellBasell is relocating its US research and development (R&D) centre from Pennsylvania to Texas. The R&D centre in Newtown Square supports intermediates and derivatives, such as propylene oxide and acetyls, said spokesman David Harpole. The transition to the 70,000-square-foot facility in Channelview, near Houston, will allow the company to develop process technologies and chemical catalysts, primarily for the acetyl business. Harpole said the transition should be completed by Q2 2013.

CHEMTURA TO START UP HVPAO BASESTOCKS PLANT
US-based specialty chemicals firm Chemtura expects to start up its new plant for high-viscosity polyalphaolefin (HVPAO) synthetic basestocks in Amsterdam in the second half of 2013, CEO Craig Rogerson said. Following start-up, product from the plant will have to be qualified by customers. Chemtura supplies the European market with HVPAO products imported from North America. The Dutch plant, announced in 2011, is expected to help Chemtura meet increasing global demand for its Synton-brand HVPAO products. Capacity and financial details were not disclosed.

CHEMTURA ON TRACK FOR START-UP FOR CHINA PLANT
US-based specialty chemicals firm Chemtura's new multi-purpose manufacturing facility in Nantong, China, is on track to begin production in the second half of 2013, CEO Craig Rogerson said. Chemtura expects to start producing petroleum additives at the new facility in the third quarter, to be followed by urethanes production in the fourth quarter. The facility will help Chemtura meet demand for its petroleum additives and urethanes products, as well as other products, in the Asian region. Chemtura had announced plans for the facility in June 2011, and it began construction in March 2012.

PBF ENERGY TOLEDO REFINERY BEGINS RESTART
PBF Energy has restarted its 170,000 bbl/day Toledo refinery in Ohio but is not back at normal production rates, according to a company source. The refinery went down following a small fire on 31 January. Aromatics production was also placed on force majeure following the fire. PBF Energy aromatics production at the refinery includes benzene, toluene and xylene. The company has not said when it expects the Toledo refinery to be back at normal rates or when it will lift its force majeure.

US CAB SHOWS SLOWLY GROWING ECONOMY - ACC
A US chemical activity gauge's three-month moving average rose by 0.6 percentage points from January, increasing for the seventh straight month, the American Chemistry Council (ACC) said. The Chemical Activity Barometer (CAB), a monthly index developed by ACC economists, rose to 92.1 in February on a three-month moving average, although the month-to-month figures were flat, with both January and February coming in at 92.4. The CAB showed a slowly expanding US economy, the ACC said.

US NEW HOME SALES JUMP BY 15.6% IN JANUARY
US sales of new single-family homes rose by about 15.6% in January to 437,000 from 378,000 in December, the Commerce Department said, with the supply of homes on the market falling to its lowest number since March 2005. Year on year, January 2013's sales were about 28.9% higher than 339,000 in the same month last year, the department said in its monthly residential sales report.

CELLULOSIC BIOFUEL OUTPUT TO MISS TARGET
The US may produce more than 5m gal of fuel from biomass in 2013, the US Energy Information Administration (EIA) said. Only about 20,000 gal of cellulosic biofuel was produced at the end of 2012. The EIA estimates this output could grow as operations ramp up at several plants. Several more plants with proposed aggregate nameplate capacity of around 250m gal could begin production by 2015. Despite this growth, the EIA said production will likely remain below targets set forth by the Energy Independence and Security Act of 2007.

SINOPEC TO BUY 50% OF CHESAPEAKE PLAY
China's Sinopec has agreed to purchase 50% undivided interest in Chesapeake Energy's US Mississippi Lime oil and gas play for $1.02bn (€775m), the companies announced. The transaction for the joint venture is expected to be completed in Q2 2013. Earlier this month Chesapeake officials said they were looking at divesting some of the company's holdings in the Mississippi Lime formation in Oklahoma and Kansas and the Eagle Ford Shale in Texas.

ASIA

CHINA APPROVES ZHEJIANG HENGYI'S BRUNEI PROJECT
Zhejiang Hengyi has secured regulatory approval from China to build a planned $4.32bn (€3.28bn) refinery project in Brunei that will house the southeast Asian country's first aromatics production, the company's parent firm Hengyi Petrochemical said. The refinery complex will have an 8m tonne/year capacity and will be built at Pulau Muara Besar. It will be able to produce 1.5m tonnes/year of diesel; 400,000 tonnes/year of gasoline; 1m tonnes/year of jet kerosene; 1.5m tonne/year of naphtha; 1.5m tonnes/year of paraxylene (PX); and 500,000 tonnes/year of benzene.

TAIWAN'S TSRC CONSIDERS MORE CUTS IN RUN RATES
Taiwan Synthetic Rubber Corp (TSRC) may further cut production at its 100,000 tonne/year styrene butadiene rubber (SBR) plant in Kaohsiung next month unless market conditions improve, a company source said. "It depends on the market conditions whether we will further reduce the SBR operating rate to70-80% of capacity in March," the source said, saying the plant was running at 90% of capacity in February.

TESSENDERLO TO SELL COMPOUNDS BUSINESS
Tessenderlo plans to sell its compounds business to Mitsubishi Chemical for an undisclosed sum, the Belgium-based chemicals firm said. The intended sale comprises production sites in France, Poland and China, as well as a research and development (R&D) site in Belgium. Tessenderlo's compounds business includes a range of thermoplastic elastomers (TPE) and polyvinyl chloride (PVC) products with applications in the building, automotive, cabling and other areas.

JSR CORP TO STOP EPDM PRODUCTION IN MARCH
Japan's JSR Corp will stop production at its 36,000 tonne/year ethylene propylene diene monomer (EPDM) plant in Kashima in the second half of March to clear stocks ahead of its new fiscal year, a company source said. The Japanese chemical producer will then shut the EPDM plant in late May until the end of June for its annual maintenance, as originally planned, the source said.

SINOPEC MAOMING STARTS UP NEW BR PLANT
China's Sinopec Maoming Co brought on stream its new 100,000 tonne/year butadiene rubber (BR) plant in Guangdong province during the weekend of 23-24 February, a company source said. The start-up of the new plant more than doubled the company's synthetic rubber production in Maoming to 180,000 tonnes/year, the source said.

Sinopec Maoming's 80,000 tonne/year styrene butadiene styrene (SBS) unit at the site is currently operating at full capacity, the source said.

MITSUI CHEM TO PRODUCE MIBC, AND CUT MIBK OUTPUT
Japan's Mitsui Chemicals plans to produce methyl isobutyl carbinol (MIBC) at its 30,000 tonne/year methyl isobutyl ketone (MIBK) plant at Iwakuni-Ohtake Works in Yamaguchi prefecture in April, said a company official. The producer plans to manufacture MIBC for two weeks in April to reduce its MIBK output and export volumes for that month, the official said. MIBC, which is produced from acetone, has applications in the manufacture of lube oil additives and is also used in surface coatings.

HOCL MAY STOP PHENOL, ACETONE PRODUCTION
India's Hindustan Organic Chemicals Ltd (HOCL) may keep its phenol/acetone production shut, citing strong competition posed by lower-priced imports in the domestic market, a company official said. The plant, which can produce 40,000 tonnes/year of phenol and 25,000 tonnes/year of acetone, in Kerala province, was shut for three months now. Before the shutdown, HOCL had been running the plant at 50% since March 2012, when huge volumes of phenol/acetone flowed into India upon the lifting of the country's antidumping duties (ADD) on imports from South Korea, Taiwan and the US.

SINOPEC, SK SIGN PETCHEM DEAL FOR CHONGQING
China's Sinopec Sichuan Vinylon Works Group and South Korea's SK Global Chemical signed a joint venture contract on 25 February to build a petrochemical project in Chongqing, state-owned media Xinhua reported. The yuan (CNY) 3.8bn ($609m) project is expected to produce 70,000 tonnes/year of acetylene unit; 300,000 tonnes/year of formaldehyde and 200,000 tonnes/year of butanediol (BDO). The project will be built at the Changshou Economic-Technological Development Area in southwestern Chongqing, with construction expected to be completed by the end of 2015.

CHINA'S PETROCHEMICAL IMPORTS RISE IN JANUARY
China's imports of many petrochemical products rose in January with some of them showing year-on-year increases of more than 40% on the back of stable domestic demand, according to data from China Customs. Imports of ethylene in January rose by 41% year on year and up 10% month on month to 151,901 tonnes, while those of propylene increased by 42% year on year to 221,757 tonnes, the data showed.

MIDDLE EAST & AFRICA

SAUDI METHANOL PLANS PLANT TURNAROUND IN H2
Saudi Methanol plans to shut its 1.7m tonne/year Ar-Razi 5 methanol plant at Al-Jubail in Saudi Arabia in the second half of this year for scheduled maintenance, a source close to the company said. "It is a scheduled shutdown and there is no impact on supplies," the source said.

 


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