AMERICAS

Covestro projects Q1 hit from US outages

Covestro expects a low to mid double-digit hit on Q1 sales from reductions and outages brought on by the US Gulf Coast storms that have knocked out the majority of chemicals production in the region. Covestro said it curtailed rates for all units at its Baytown, Texas, complex last week as a result of the storm. The company had time to bring down or reduce rates at the units in a controlled way, according to CEO Markus Steilemann.

US aromatics experience supply disruptions

Extreme winter weather disrupted petrochemical supplies in the US Gulf Coast region by taking offline critical capacities, including aromatics production. Total and Motiva shuttered their Port Arthur, Texas, facilities, both due to the freezing conditions without a definitive timeline for a restart. ExxonMobil brought down its refining facilities in Beaumont and Baytown, Texas. CITGO and Flint Hills Resources closed their Corpus Christi, Texas, refineries amid cold weather conditions and brief power loss, respectively.

Goodyear in $2.5bn deal for Cooper Tire & Rubber

Tyre major Goodyear has agreed to acquire Cooper Tire & Rubber in a deal with a total enterprise value of about $2.5bn. Cooper, of Findlay, Ohio, is the fifth-largest tyre manufacturer in North America by revenue with about 10,000 employees working in 15 countries. Cooper products are manufactured in 10 facilities around the globe, including wholly owned and joint venture plants. The combined Goodyear-Cooper entity has about $17.5bn in pro forma 2019 sales.

INEOS Styrolution declares force majeure on ABS

Operations at INEOS Styrolution’s Altamira, Mexico, plant were severely disrupted by last week’s winter storm, leading to a force majeure on acrylonitrile-butadiene-styrene, polycarbonate, styrene acrylonitrile and acrylonitrile styrene acrylate, according to a customer letter. The company said the storm affected the plant’s ability to obtain adequate supplies of natural gas, electricity and other utilities and that inhibits the plant’s ability to continue operations. The company said it did not know when operations and supply would return to normal levels.

Westlake Q4 profit rises on higher PE, PVC margins

US-based Westlake’s Q4 income from operations and net profit rose year on year on higher sales prices and margins for polyethylene (PE) and polyvinyl chloride (PVC) resin. Westlake saw higher earnings in downstream building products, driven by strong demand. These positives were partially offset by the impacts of two hurricanes that hit Louisiana in August and October 2020, resulting in lost sales and production volumes and increased maintenance expenses and by higher ethylene and fuel costs and lower sales prices for caustic soda.

Braskem to expand ethylene capacity

Braskem is increasing its capacity to produce renewable ethylene, the main feedstock derived from sugarcane ethanol, which is used in the production of renewable resins. The expansion project will cost $61m, will be rolled out in 2021 and should be concluded in Q4 2022. Braskem will increase the current capacity from 2,000 tonnes/year to 2,600 tonnes/year at the company’s plant in Triunfo, in the Brazilian state of Rio Grande do Sul.

Petrobras shares plunge 21% after CEO turmoil

The US-listed shares of Brazilian energy producer Petrobras plunged on Monday after the government requested a replacement for the company’s CEO. US-listed shares closed at $7.94, down by $2.11 or 21.0%. Late last Friday, Petrobras reported that Brazil’s Ministry of Mines and 
Energy had requested that the company’s board of directors consider Joaquim Silva e Luna to be the company’s next CEO. The mandate of the current CEO, Roberto Castello Branco, ends on 20 March 2021.

Dow declares FM on products from Texas City

Dow has declared force majeure for several products produced at the company’s site in Texas City, Texas, according to a customer letter. The declaration includes 2-ethyl hexanol, butanol and isobutanol. The company could not be reached for comment. This comes as extreme weather conditions resulted in temperatures below freezing at the company’s site, leading to an involuntary unplanned shutdown. It will allocate available product, but the allocation volume was not disclosed in the letter.

Westlake expects to restore US PE production

Westlake expects to get its assets in the US Gulf back to normal production over the next several weeks, company executives said Tuesday on an earnings call. CEO Albert Chao said Westlake still has some plants running and has not declared force majeure on polyethylene (PE). Chao added that they are working to maintain a balance between demand, inventories and production levels. Chao said the winter storm will have an impact on pricing and availability of US PE.

Roehm mulls 250,000 tonne/year MMA plant

Roehm has signed a memorandum of understanding with OQ Chemicals to potentially build a 250,000 tonne/year methyl methacrylate (MMA) plant on the US Gulf Coast, the German chemicals producer said. The plant is to be commissioned in 2023 and would be integrated at OQ Chemicals’ facilities in Bay City, Texas. Financial details were not provided. The project was first disclosed by ICIS in October 2019. The MMA production will use Roehm’s proprietary technology LiMA.

EUROPE

MOL Q4 petchem earnings nearly quadruple

MOL Group’s petrochemicals earnings in Q4 2020 nearly quadrupled from the same period in 2019 on the back of strong margins. The company’s Q4 2020 integrated petrochemical margin at €386/tonne was up 38% year on year and up 14.9% from the third quarter. Q4 petrochemical product sales stood at 387,000 tonnes, up 38.7% year on year and up 20.2% from the Q3. MOL expects its integrated petrochemical margin to be in the €300-€400/tonne range in 2021.

ALPLA to invest €50m/year in recycling to 2025

Austrian plastic packaging manufacturer and recycling specialist ALPLA Group will invest an average of €50m a year in recycling between now and 2025. ALPLA had previously committed to spending a total of €50m to expand its recycling activities up to 2025 as part of the Ellen MacArthur Foundation’s Global Commitment.

Covestro Q4 net income surges on higher sales

Covestro net income surged to €312m in Q4 2020 amid higher sales volumes and prices, the German polymer producer said. Core volumes sold rose by 1.7% year on year in Q4 2020 but were down by 5.6% for the full year. Covestro expects core volume growth of between 10% and 15% in 2021. The group’s earnings before interest, tax, depreciation and amortisation (EBITDA) for full-year 2021 is anticipated to come in at between €1.7bn and €2.2bn.

Borealis to invest in de-carbonising tech

Borealis is investing €17.6m in decarbonising its polylefins plant in Porvoo, Finland, the Austrian producer announced. Funding will go towards installing a regenerative thermal oxidiser (RTO) which will lower carbon dioxide (CO2) emissions, reduce flaring and save around 60GWh of energy each year. The project will start this February and is scheduled for completion in 2023. The RTO is a piece of equipment that treats exhaust air.

Eurozone inflation swings to positive in January

Inflation in the eurozone swung to a positive 0.9% in January, up from December’s -0.3%, statistical office Eurostat said on 23 February. Since August 2020, prices across the 19-country currency union had been in negative territory due to the downturn caused by the pandemic, especially the heavy falls in energy prices. While crude oil prices have regained some ground year to date, the increase in the eurozone’s inflation rate came from domestic economic sectors.

Germany petchems expect big uptick in orders

As the global economy revives from the pandemic-induced slump, Germany’s export-orientated, petrochemicals-intensive manufacturers are expecting a significant uptick in orders over the coming months, research institute Ifo said. Ifo’s Export Expectations index rose during February to its highest since September 2018, despite the European economy being one of the hardest hit by the pandemic. The more positive sentiment among German manufacturers was based on China’s good economic performance as well as an increase in US production.

Solvay Q4 net profit falls amid drop in margins

Solvay’s net profit fell by 41% year on year to €96m in Q4 2020 amid lower chemical margins, the Belgium-based producer said. Group sales to China increased by 5% year on year and for the full year were up by 3%. Overall underlying earnings before interest, tax, depreciation and amortisation (EBITDA) declined “due mainly to volumes and foreign exchange impact”, the company said.

EU Jan commercial vehicles registrations fall

The automotive industry’s woes for 2021 worsened as the commercial vehicles segment saw a year on year fall in registrations of more than 7.2% in January, the European Automobile Manufacturers Association (ACEA) said on 24 February. Commercial vehicles mostly purchased by companies are vans, trucks, or coaches. In January, some EU countries introduced a new tax on carbon dioxide (CO2) emissions, which coupled with lockdowns to contain the spread of the pandemic, dented automotive demand from the private sector.

Europe, US chems firms gaining momentum

Economic sentiment and business momentum are building for the Europe and US chemicals sectors, despite the prospect of a softer Q2 2021, analysts at Germany-based Baader Bank said. The strong performance in Q4 2021 has continued into the early months of this year, as demand patterns bucked traditional seasonal slowdowns for many chemicals on the back of continued restocking and supply tightness during the pandemic.

ASIA

Mitsui Chemicals restarts Chiba cracker

Mitsui Chemicals restarted the cracker at its Ichihara Works site in Chiba prefecture on 23 February and is in the process of restarting other downstream units. The company was forced to shut operations at the Ichihara Works following a 7.3-magnitude earthquake that hit the country on 13 February. The cracker, which produces 612,000 tonnes/year of ethylene and 330,000 tonnes/year of propylene, is “expected to be fully restored within a few days”.

Reliance eyes regulatory nods for O2C spinoff

India-based Reliance Industries Ltd (RIL) has initiated the spin off its oil-to-chemical (O2C) business into an independent subsidiary. The company expects to get the necessary approvals for the demerger to be completed by the second quarter (July-September 2021) of its fiscal year ending March 2022, Reliance said in a bourse filing. The spin-off firm - RIL O2C Ltd - will control its refining, marketing and petrochemical assets.

Arkema to increase fluoropolymer production

Arkema is further increasing its fluoropolymer production capacities in Changshu, China, by 35% in 2022. The increase in capacity is scheduled to come on stream before the end of 2022. Financial and overall capacity details of the expansion project were not disclosed.

PCG Q4 profit rises 
37% on lower opex

PETRONAS Chemicals Group’s (PCG) net profit rose by 37% year on year to Malaysian ringgit (M$) 466m in the fourth quarter, supported by lower operating expenditures. Revenue fell largely due to lower sales volume and product prices. PCG’s priorities for the year are the start-up and commercial operations of the petrochemical facilities within the Pengerang Integrated Complex as well as kick-starting construction of other facilities within the Kerteh and Gebeng complexes.

Sinopec Hainan, Baling partner on TPE project

Sinopec Hainan Refining & Chemical and Baling Petrochemical are planning to jointly invest yuan (CNY) 2.2bn ($341m) to build a 170,000 tonne/year thermoplastic elastomer (TPE) project at Yangpu in Hainan province, market sources said. The project will have 120,000 tonnes/year of styrene-butadiene-styrene (SBS) and 50,000 tonnes/year of styrene-ethylene-butylene-styrene (SEBS) capacities. The companies are targeting to begin construction within this year.

Chandra Asri receives $60m credit line

Indonesia’s Chandra Asri Petrochemical has received a $60m structured trade facility from Singapore’s DBS Bank to support the company’s efforts to expand export growth of petrochemical products, according to a joint statement. “This is in line with the company’s master plan to vertically integrate, support domestic consumption and grow its export sales of monomers and polymers from Indonesia,” they said. Chandra Asri is the largest integrated petrochemical producer in Indonesia and operates the country’s only naphtha cracker.

China polyolefin inventories up after holiday

The combined polyethylene (PE) and polypropylene (PP) inventories of Chinese state-owned petrochemical giants Sinopec and PetroChina rose in the week to 19 February. On 19 February, the second workday after the week-long Chinese Lunar New Year holiday (11-17 February), inventories stood at 925,000 tonnes, up by 55.5% from 10 February, according to market sources. The inventories were down by 21.6% compared with the second workday after the holiday in 2020.

Sumitomo licenses PE/EVA technology to KOS

Sumitomo Chemical is licensing out its high-pressure production process for low density polyethylene (LDPE) and ethylene vinyl acetate (EVA) to Russian producer Kazan Organichesky Sintez PJSC (KOS). KOS is installing a new 100,000 tonne/year PE/EVA facility as its manufacturing site in Kazan, Russia. Sumitomo’s high pressure PE technology is a proprietary autoclaving PE production process, which is switchable between LDPE and EVA in one manufacturing facility..