News in brief

10 January 2014 09:47  [Source: ICB]

ASIA

EXXONMOBIL’S ASIA-PAC CAPACITY GROWS 50%
ExxonMobil’s production capacity in the Asia-Pacific region grew by more than 50%, with its expanded manufacturing site in Singapore. The expansion includes a new 1m tonne/year steam cracker that has the ability to use crude as feedstock. The expanded Singapore Chemical Plant (SCP), which can produce more than 2.5m tonnes/year of new derivative products, is ExxonMobil’s largest integrated refining and petrochemical investment in the world. SCP’s expansion includes the new 1m tonne/year steam cracker that can use crude as feedstock.

FUSHUN SHUTS 350,000 TONNE/YEAR HDPE UNIT
China’s Fushun Petrochemical shut its 350,000 tonne/year high density polyethylene (HDPE) unit on 7 January in Fushun, Liaoning province. The HDPE unit will be shut down for about a month because of losses due to declining HDPE injection prices. The unit mainly produces HDPE injection grade since it was started up in 2012. The average price of domestic HDPE injection grade in January 2014 was yuan (CNY)11,450/tonne ($1,890/tonne), down by 0.58% compared with the average price in November 2013.

SHANDONG LUBEI RUNS NEW CAUSTIC UNIT AT 50%
China’s Shandong Lubei Chemical is running its new 150,000 tonne/year caustic soda unit in Shandong province at 50% capacity after it was commissioned on 3 January. However, the company’s new 1m tonne/year downstream alumina unit, which would consume output from the new caustic soda unit as feedstock, is unlikely to be put into operation in the first quarter of 2014. As a result, the company has more caustic soda product to offer to the local market.

LG CHEM REDUCES DAESAN BPA RUN RATES TO 70%
South Korea’s LG Chem is reducing the operating run rate of its bisphenol-A (BPA) plant in Daesan. The plant has a nameplate capacity of 150,000 tonnes/year and it was previously running at close to full capacity before the reduction. It remains unconfirmed as to how long LG Chem will be running the plant at 70% capacity as the company will need to observe the market situation.

BMC HOPES TO RESTART METHANOL UNIT IN H2
Brunei Methanol Co (BMC) hopes to resume production at its 850,000 tonne/year methanol plant in Sungai Liang Industrial Park in the second half of January. The methanol plant was taken off line in May 2013 for scheduled maintenance, and the restart has been delayed. BMC decided that more time was needed for maintenance. Some end-users were worried about regional methanol supplies, given that none of the plants of PETRONAS, BMC, Kaltim Methanol Industri in Southeast Asia were operating.

PCG LABUAN METHANOL UNITS REMAIN SHUT
Malaysia’s PETRONAS Chemicals Group (PCG) has yet to firm up the start-up schedule for its two methanol units in Labuan that are currently undergoing turnarounds. The company’s 660,000 tonne/year No 1 methanol unit in Labuan has been shut since 3 January because to technical issues. Its 1.7m tonne/year No 2 methanol plant in Labuan is concurrently shut for maintenance. The No 2 unit was scheduled to be restarted in January after being shut in mid-November for 50 days of maintenance.

FUJIAN SOUTHEAST TO START TDI COMMERCIAL
China’s Fujian Southeast Electrochemical Co expects to start commercial operations at its 100,000 tonne/year toluene di-isocyanate (TDI) plant in Fuqing city, Fujian province, in mid-to-late February, after the Lunar New Year holidays. The company has achieved on-spec products at the new TDI unit on 31 December 2013. The new TDI unit has two lines, each with a capacity of 50,000 tonnes/year. One has come on stream, while the start-up of the other one will depend on the performance at the first line.

TSRC TO KEEP SBR PLANT OPS AT REDUCED RATE
Taiwan Synthetic Rubber Corp (TSRC) will continue to run its 100,000 tonne/year styrene butadiene rubber (SBR) plant in Kaohsiung, Taiwan, at a reduced rate of 60-70% in January because of prevailing weak market conditions. “We were running at the reduced rate of 60-70% of capacity last month and will continue to run at this rate in January because of poor margins,” a source said. Weak demand and ample supply have weighed on SBR prices.


MIDDLE EAST AND AFRICA

FANAVARAN TO RESTART ACETIC ACID
Iran’s Fanavaran Petrochemical plans to resume production at its 150,000 tonne/year acetic acid plant at Bandar Imam Khomeini following a prolonged maintenance shutdown. The acetic acid plant was initially taken offline on 4 December for a 20-day maintenance shutdown, but it was completed in 10 days. The acetic acid plant was operating at 90% capacity prior to the shutdown. Operations at the plant however, could not resume as scheduled because of a shortage in feedstock methanol following an unplanned outage at its 1m tonne/year methanol plant.

FANAVARAN RUNS METHANOL PLANT AT 50%
Iran’s Fanavaran Petrochemical resumed production at its 1m tonne/year methanol plant in Bandar Imam Khomeini on 5 January and is now running it at 50% capacity, a company source said. The company had taken the plant off line on 14 December because of feedstock gas shortages. However, the company had to begin production of some quantity again to satisfy the domestic methanol market, according to the company source.

AMERICAS

BRAZIL REDUCES TIO2 IMPORTS TARIFF TO 2%
Brazil has reduced its import tariff for titanium dioxide (TiO2) to 2% from 12% to help the country meet domestic demand for the pigment, the nation’s paint manufacturers association said. The tariff is valid for imports of up to 120,000 tonnes of TiO2 for a period of 12 months. The reduction is a result of a move by the paint association, Abrafati, which argued that domestic production cannot meet the country’s demand. Brazil has two TiO2 plants that have a combined capacity of 120,000 tonnes/year, according to ICIS plants and projects.

APLA NAMES MANUEL DIAZ EXECUTIVE DIRECTOR
The Latin American Petrochemical Association (APLA) has named Manuel Diaz as its executive director, effective on 1 January, the group said. Diaz is replacing Graciela Gonzalez Rosas, who held the position since December 2000. Diaz has previously been the vice president of the Argentine Petrochemical Institute (IPA), the chairman of Grupo Brasil, the general manager of Praxair Chile and the CEO of Praxair Argentina.

SODA ASH FALL IN EUROPE TO DRAW US EXPORTS
Europe may this year see a rise in shipments of trona-based soda ash from the US on the back of low short-term expectations of substantial exports from Turkey, a bank said. Announced closures of synthetic soda ash plants in Europe would present an export market opportunity to US trona-based soda ash producers, said Dominik Niszcz, an analyst at Raiffeisen Centrobank (RCB). Solvay has said that it will cease soda ash production at its 230,000 tonne/year plant in Povoa, Portugal, by January and reduce capacity at its plant in Rosignano, Italy, to operate at an as-needed level, whileTata Chemicals has said it will close a 450,000 tonne/year plant in Listock, Cheshire, the UK, by March.

POLYONE TO FURTHER REALIGN SPARTECH ASSETS
US polymer materials firm PolyOne said it will further realign the North American assets acquired last year following the takeover of plastic sheet, compounds and packing solutions producer Spartech. PolyOne said the acquired assets, which are primarily located in Ramos, Mexico, would now operate within its Seabrook, Texas, US-headquartered Performance Products and Solutions (PP&S) segment. An administrative office in Pennsylvania, US would be closed with work transitioned to Seabrook, the company said.

SCHULMAN ACQUIRES PRIME COLORANTS FOR $15.1M
US plastics compounds and resins firm A. Schulman has acquired Prime Colorants for about $15.1m (€11.0m), it said. Tennessee-based Prime Colorants is a producer of custom colours and additive concentrates. It employs about 50 people and had revenues of about $12m last year. “This latest acquisition is part of our ongoing strategy to grow our custom colour capabilities in the US, as well as further transform our US operations from commodity products to a business focused on niche products and services,” said Schulman CEO Joseph Gingo.

SCHULMAN COMPLETES BRAZIL CONSOLIDATION
A. Schulman’s consolidated plant in Brazil is operational amid hopes that the South American country’s economy begins to grow again at a substantial rate, executives with the US-based compounder said. “We are in the process of finalising our restructuring actions, so when we do experience any uptick in the local economy, our footprint rationalisation will allow us to cost effectively capitalise on our opportunities,” said chief operating officer Bernard Rzepka. “We still expect to see the majority of our estimated $1.4m [€1.0m] of synergies starting in the second half of this fiscal year,” added Rzepka during a fiscal Q1 (ended November) 2014 earnings conference call.

ENTERPRISE TO EXPAND HOUSTON LPG TERMINAL
Enterprise Products Partners will further expand its liquefied petroleum gas (LPG) export terminal at US petrochemical storage firm Oiltanking’s complex on the Houston Ship Channel rather than pursuing plans for a second LPG terminal, the US-based midstream energy company said. At the same time, Enterprise is continuing talks with several customers on the development of an ethane export terminal in Texas, it said. Enterprise said that the expanded LPG export terminal is expected to be in service by the end of 2015. The project is supported by long-term LPG export agreements and by a 50-year service agreement with oil and chemicals logistics firm Oiltanking to provide additional dock space and related services.


EUROPE

REPSOL INVESTS €95M IN TARRAGONA CRACKER
Spain-based Repsol announced it had invested €95m ($130m) in maintenance and technical improvements at its Tarragona cracker during a shutdown period. On 2 January, a company spokesman said Repsol’s cracker in Tarragona had successfully restarted and was running normally. On 30 December, a company source had said although it was running normally, it had not yet achieved on-spec output. The cracker, which has the capacity to produce 702,000 tonnes/year of ethylene, had been undergoing planned maintenance since early October.

M&G PLANS PET MAINTENANCE FOR END JAN
Italy-based polyethylene terephthalate (PET) producer Mossi Ghisolfi Group (M&G) will shut down its site in Patrica for 10 days at the end of January for maintenance. A company source said: “…this is why we are sold out”. Demand is higher than expected, possibly due to restocking and delayed imports, the source added. The 140,000 tonne/year plant was originally due to go down for two weeks of annual maintenance in the fourth quarter.

BDI TO BUILD €47M BIODIESEL EXPANSION
BDI BioEnergy International said it has been commissioned to build a €47m expansion at Biodiesel Amsterdam’s multi-feedstock biodiesel facility in the Netherlands to increase the site’s capacity to 250,000 tonne/year. The Austria-based biofuels technology firm said the plant, in the port of Amsterdam, will be the largest of its kind. Dutch firm Biodiesel Amsterdam, a subsidiary of Simadan Holding, has an existing 100,000 tonne/year plant at the site, supplied by BDI, which was brought into operation in 2010.

AKZONOBEL 2013 PROFIT NOT LIKELY TO EXCEED €908M
Netherlands-based coatings major AkzoNobel said its full-year 2013 operating income before incidental items is unlikely to exceed €908m, with trading in the fourth quarter in line with previous trends amid a challenging economic environment. The company completed the sale of its building adhesives business in the fourth quarter of 2013, which will result in an incidental profit of around €200m. However, this is expected to be largely offset by additional incidental charges, including a non-cash write-down in its specialty chemicals business.

GERMANY UNION WAGE BARGAINING TO BEGIN
Germany’s chemical industry employers and union IG BCE will begin bargaining the 2014 wage round on a federal level on 15 January as regional talks have failed, employers group BAVC said. BAVC once again rejected the union’s 5.5% wage hike demand for the country’s 550,000 chemical and pharmaceutical industry workers as “excessive and unrealistic”. “The 2014 wage deal will not be anywhere near the 5.5% increase demanded by the union,” said Hans-Carsten Hansen, who leads the negotiations for the employers.

FRENCH POLICE RESCUE GOODYEAR MANAGERS
French police intervened to help secure the release of two managers held captive for almost 30 hours at a Goodyear tyre plant north of Paris. Unionised workers took the two Goodyear plant managers captive following a meeting on 6 January between management and union CGT over plans to close the company’s facility in Amiens. The planned closure, which has been in the works for several years, affects about 1,200 jobs.

BASF CAPRO PLANT AT REDUCED CAPACITY
BASF’s caprolactam (capro) plant at Ludwigshafen, Germany, is currently operating at reduced rates because of production problems, a company source confirmed. The production problems began in the final week of December – it is not known when they will be resolved and sales volumes have been limited as a result. The source would not comment on the size of the affected capacity. BASF has a total European nameplate capacity of 500,000 tonnes/year spread among plants at Ludwigshafen and Antwerp.

UK NEW CAR REGISTRATIONS BACK TO PRE-CRISIS LEVELS
New car registrations in the UK increased by 10.8% year on year in 2013, making it the strongest year for automotive sales in the country since before the recession, UK-based trade body the Society of Motor Manufacturers and Traders (SMMT) said. According to the SMMT, 2.26m cars were registered in the country, representing a level not seen since 2007 and an additional 600 cars registered per day than in 2012.


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