Asia-Chemicals Outlook 2017 Final
Asia-Chemicals Outlook 2017 Final
Asia-Chemicals Outlook 2017 Final
ASIA
CHEMICALS
OUTLOOK
2 17
Key markets covered:
UPSTREAM FEEDSTOCK
AROMATICS PLASTICS/POLYMERS NAPHTHA
BENZENE POLYCARBONATE METHYL TERTIARY BUTYL ETHER
TOLUENE POLYETHYLENE (PE) (MTBE)
STYRENE POLYPROPYLENE (PP)
PARAXYLENE POLYVINYL CHLORIDE (PVC)
MIXED XYLENES PLASTICIZERS OTHERS
METALLOCENE LINEAR LOW DENSITY BASE OILS
POLYETHYLENE (MLLDPE) CAPROLACTAM
FIBRE INTERMEDIATES CAUSTIC SODA
PURIFIED TEREPHALATIC ACID (PTA) EPICHLOROHYDRIN (ECH)
POLYETHYLENE TEREPHALATE (PET) POLYURETHANE MALEIC ANHYDRIDE (MA)
AND RECYCLED POLYETHYLENE PROPYLENE OXIDE METHYL METHACRYLATE (MMA)
TEREPHALATE (R-PET) TOLUENE DI-ISOCYANATE (TDI) PARAFFIN WAX
MONOETHYLENE GLYCOL (MEG) TITANIUM DIOXIDE (TIO2)
NYLON VINYL ACETATE MONOMER (VAM)
RUBBER PHTHALIC ANHYDRIDE (PA)
STYRENE BUTADIENE RUBBER (SBR)
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Asian countries such as India, China, Northeast and southeast Asia for over 180 plans for production and investment activities. The China Annual Studies include
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help you understand the key price drivers and market conditions and settle your downstream demand overview and outlook, as well as analyses on key issues
contract prices confidently with access to time-sensitive offers, bids and price and developments in the market.
movements.
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ICIS publishes monthly forecast reports for Be the first to find out about breaking news and Receive an end-to-end perspective across the
selected commodities showing a 12-month rolling analysis across the global petrochemical markets. global petrochemical supply chain, enabling you
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demand, trade balances, capacity and margins. It is updates, plant capacities, output and shutdowns, context. Data includes import and export volumes,
a valuable tool to identify commercial opportunities plus so much more. consumption, plant capacities, production and
in the short to mid-term. product trade flows from 1978 up to 2030.
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ACIDS
ACRYLATE ESTERS/ACRYLIC ACID
ASIA ACRYLATES MARKET FACES Demand will likely be stable as most end- You can rely on ICIS for all
TIGHT SUPPLY IN H1 users have not increased production or
increased their allocations of acrylic acid
your acrylate ester/acrylic acid
By Paul Lim
and acrylate ester cargoes, market sources market intelligence needs
SINGAPORE (ICIS)--Supply of acrylic acid said.
and acrylate esters in Asia is expected PRICING INFORMATION
to remain tight in the first half of 2017 Consumption may slow down ahead of the
ICIS offers regional price assessments and
until major plants that were shut this year Lunar New Year - which is observed in most market analysis for the Asian acrylate ester/acrylic
resume production, market sources said. parts of northeast and southeast Asia - but acid market, including price histories and expert
sellers remained optimistic about higher commentary to help you understand the key price
drivers and market conditions and settle your
A spate of major incidents at production prices. contract prices confidently with access to time-
facilities in Asia and Europe caused supply sensitive offers, bids and price movements.
to tighten dramatically in the last quarter of The Lunar New Year falls on 28 January
2016, leading to spikes in acrylates prices, and is celebrated for a full week in China. Request your free sample report
they said.
European buyers had fixed arbitrage NEWS INFORMATION
The incidents include the explosion cargoes from Asia and the Middle East all
Be the first to find out about acrylate ester/acrylic
at BASFs propylene pipeline at its the way into first quarter of 2017. acid-related breaking news and analysis across the
Ludwigshafen site in Germany on 7 global petrochemical markets. Our market-moving
Some Asian acrylic acid and acrylate ester news articles cover production updates, plant
October, prompting the company to declare capacities, output and shutdowns, plus so much
a force majeure on supply of acrylic producers do not have sufficient quantities more.
monomers on 31 October. on hand to sell cargoes to the spot market.
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The force majeure has remained in place, In the key Chinese market, price spikes were
with repairs at the companys propylene more pronounced since supply is curbed with
SUPPLY AND DEMAND DATABASE
pipeline expected to last until June-July producers running plants at low operating
2017, according to market sources. rates of 40-50% for the most part of 2016. Receive an end-to-end perspective across the
global petrochemical supply chain, enabling you
to grasp the local or regional scenario in a global
In China, Jiangsu Sanmu shut its 140,000 In southeast Asia, spot demand was stable context. Data includes import and export volumes,
tonne/year acrylic acid plant and acrylate but end-users have had to compete with consumption, plant capacities, production and
product trade flows for acrylate ester/acrylic acid
esters production units on 25 November buyers in other regions that were willing from 1978 up to 2030.
following a fire at its feedstock pipeline. to pay higher prices for the cargoes. The
There is no confirmed restart date for the region continues to receive arbitrage
Enquire about the supply/demand database
plant and market sources are saying the cargoes from the Middle East and offers for
shutdown could last a few months. China-origin material.
End-users in Germany and China went In India, the market is expected to continue
scrambling to secure sufficient volumes feeling the adverse effects of the November
from the spot market, consequently driving demonetisation of high-denomination rupee
up acrylic and acrylate esters prices in Asia notes in the first quarter of next year, as
in the fourth quarter. consumers struggle to get their hands on
cash for basic necessities.
Most industry sources expect the high
prices to remain into the first half of 2017. Demand for paints and coatings in the
country had taken a hit from the cash
Scheduled turnarounds in Asia for the crunch. End-consumers were hoarding
period could exacerbate the tightening of cash for purchasing daily necessities such
supply, and thus, maintain firm support on as food, instead of spending on paints to
prices, market sources said. spruce up homes, industry sources said.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
ACIDS
ACRYLONITRILE (ACN)
ASIA ACN TO GET SUPPORT IN 1H ACN prices in northeast Asia fell by 11% and Cornerstone Chemical will have
FROM HEAVY TURNAROUNDS to $1,150-1,250/tonne CFR (cost & freight) turnarounds in May, sources said.
By Judith Wang NE (northeast) Asia from end October while
prices in India plummeted by around 24% The deep-sea cargoes in first half of 2017
SINGAPORE (ICIS)--A slew of turnarounds from late October levels to $1,000-1,100/ will be less as three major US producers will
in the first half of 2017 may exert upward tonne CFR India in the week ended 2 have maintenance plans in May, a regional
pressure on Asian acrylonitrile (ACN) December, according to ICIS. end-user said.
prices, though the second half of the year
may likely see them soften amid resumed The availability of deep-sea cargoes to However, the prices in first half of 2017 will
supply, industry sources said. Asia will be cut in first half of next year as be stronger than the second half given less
three major US producers including INEOS turnarounds in the second half of 2017,
The heavy turnarounds season in Asia Nitriles, Ascend Performance Materials sources said.
will start in February 2017 and end in
May, which will deter the prevailing price
downtrend and lend support to ACN prices.
You can rely on ICIS for all your ACN market intelligence needs
ICIS offers regional price assessments and market Be the first to find out about ACN-related breaking Receive an end-to-end perspective across the global
analysis for the Asian ACN market, including price news and analysis across the global petrochemical petrochemical supply chain, enabling you to grasp
histories and expert commentary to help you markets. Our market-moving news articles cover the local or regional scenario in a global context. Data
understand the key price drivers and market conditions production updates, plant capacities, output and includes import and export volumes, consumption,
and settle your contract prices confidently with access shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for ACN from 1978 up to 2030.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
ACIDS
ACETIC ACID
This incremental cost of methanol However, the higher prices may only Producers would start to build their
feedstock was expected to subsequently materialise in the second and third quarter inventory level up right after the Chinese
drive up acetic acid values in the Chinese due to a concentration of maintenance New Year holidays in late January, a
domestic market as well as in Asia, market shutdown scheduled at acetic acid plants northeast Asia based acetic acid
participants noted. during that period. producer said.
Jiangsu Sopo Chemical* 1.2m Zhenjiang, Jiangsu, China April: one month (TBC)
Daicel Chemical Industries* 450,000 Himeiji, Hyogo, Japan Mid-May 2017: at least one month
Shanghai Wujing Chemicals 500,000 + Wujing, Shanghai, China Big unit 3 weeks in May
200,000 Smaller unit 2 weeks in June
Lotte BP Chemicals Co. Ltd 600,000 Ulsan, South Korea May: 25 days
BYACO (BP YPC Acetyls Company)* 500,000 Nanjing, Jiangsu, China July: 30 days (TBC)
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
New Ethyl Acetate Projects
Korea Alcohol 45-50kt/year Ulsan, South Korea Feb 2017 Expansion, new plant start-up
The producer added that some of the acetic Acetic acid prices have generally been on market as well higher feedstock costs,
acid producers in northeast Asia who had an uptrend throughout 2016 on tight supply market sources said.
focused on domestic sales would have to and normal demand situation. But they rose
import from the spot market to support their sharply from September onwards on the In terms of demand growth, new
long term domestic customers. back of several turnarounds in key China downstream capacities in 2017 were
confined to China, South Korea and India.
You can rely on ICIS for all your acetic acid market intelligence needs
ICIS offers regional price assessments and market Be the first to find out about acetic acid-related Receive an end-to-end perspective across the global
analysis for the Asian acetic acid market, including breaking news and analysis across the global petrochemical supply chain, enabling you to grasp
price histories and expert commentary to help you petrochemical markets. Our market-moving news the local or regional scenario in a global context. Data
understand the key price drivers and market conditions articles cover production updates, plant capacities, includes import and export volumes, consumption,
and settle your contract prices confidently with access output and shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for acetic acid from 1978 up to 2030.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
ACIDS
ADIPIC ACID (ADA)
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analysis for the Asian adipic acid market, including breaking news and analysis across the global petrochemical supply chain, enabling you to grasp
price histories and expert commentary to help you petrochemical markets. Our market-moving news the local or regional scenario in a global context. Data
understand the key price drivers and market conditions articles cover production updates, plant capacities, includes import and export volumes, consumption,
and settle your contract prices confidently with access output and shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for adipic acid from 1978 up to 2030.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
ACIDS
ETHYLENE VINYL ACETATE (EVA)
ASIA EVA MAKERS FACE 2016, an increase of around 9% compared In the last 2-3 years we [have] already
CHALLENGES AMID HIGHER to the same period in 2015, China customs diversified our portfolio to make film or
SUPPLY data showed. hotmelt ahesives, solar panel and coatings
By Helen Lee grade EVA or EVA with extra high VA
Several producers in Asia indicated that content for foaming applications, the South
SINGAPORE (ICIS)--Asias ethylene vinyl they will continue to focus their output on Korean producer said.
acetate (EVA) producers face a challenging niche EVA grades rather than the generic
year ahead on shrinking demand in China for foaming grade EVA with 14-20% vinyl The move away from the foaming grade
their cargoes due to increased EVA capacities acetate (VA) content to cope with changing would mean it would be difficult for some
in China as well as the Middle East. market dynamics. Korean producers to maintain their current
market share in India, the producer added.
Among others Chinas Jiangsu Sailboat EVA with 14-20% VA content is used in the
Petrochemical Company plans to start trial foaming/footwear industry. South Korea-origin EVA enjoys duty free
operations at its new 300,000 tonne/year status in India while Middle East and other
EVA plant in Lianyungang city, Jiangsu We are not so positive due to new EVA northeast Asian origin material are subject
province, at the end of December, following capacities, another South Korean EVA to Indias 7.5% import duty.
several rounds of delays. producer said. The demand side in
China is not so clear but obviously the To find our niche market of 15,000 to
Chinas [EVA] production capacity has foaming grade EVA will be a red ocean of 20,000 tonnes of new demand for all grades
increased so imports will be decreased from competitive pricing. although it might be small, but it would be
next year So it will be difficult for us, a enough for us, he added.
South Korea-based EVA producer said. Other producers are diversifying into
EVA grades with higher VA content and In the near term, however, EVA producers
EVA production in China is meeting almost expanding into other markets such as hold a rosy outlook on the pricing due to
35% of the countrys demand but this will Europe, South America and Africa. the prevailing peak production season
rise to 50% from 2017 onwards, according in the downstream footwear materials
to the producer. EVA with 22-30% VA content is used in the sectors in China and India as well as in the
wire and cables industry, as well as the hotmelt adhesives sectors in November and
China imported 693,420 tonnes of primary hotmelt adhesives industry. December.
grade EVA during the first nine months of
You can rely on ICIS for all your EVA market intelligence needs
ICIS offers regional price assessments and market Be the first to find out about EVA-related breaking Receive an end-to-end perspective across the global
analysis for the Asian EVA market, including price news and analysis across the global petrochemical petrochemical supply chain, enabling you to grasp
histories and expert commentary to help you markets. Our market-moving news articles cover the local or regional scenario in a global context. Data
understand the key price drivers and market conditions production updates, plant capacities, output and includes import and export volumes, consumption,
and settle your contract prices confidently with access shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for EVA from 1978 up to 2030.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
ALCOHOLS
OXO-ALCOHOLS
ASIA OXO-ALCOHOLS MARKETS facility in March 2017. The new domestic spot market, giving them more bargaining
HEAD FOR SOFT LANDING IN Q1 capacity may dull imports, market sources power when buying import cargoes.
By Joson Ng said.
The dioctyl phthalate (DOP) spot market
SINGAPORE (ICIS)--Northeast Asias Spot 2-EH prices trended up in November had healthy gains in the month of
oxo-alcohols markets may be heading for 2016 by some 6.6%, tracking gains in the November. Strong feedstock phthalic
a correction in the early 2017, following feedstock propylene spot market. anhydride (PA) market, coupled with tight
an unexpected surge in prices in the last supply drove up DOP prices by some 6.3%
quarter of 2016, but buffered by restocking Popylene is expected to be an important in November.
activity, market sources said. marker for the 2-EH spot market. Northeast
Asias propylene markets may see a dull Like the rest of oxo alcohols, DOP prices
Buyers are expected to be in the market to start to the year with some new start-ups are expected to be slightly weaker at the
replenish inventory ahead of the Lunar New expected in China. start of the year. The market is likely to track
Year, which falls on 28 January 2017, and the Chinese domestic and feedstock PA
this should provide some support to prices, These new start-ups in China have buyers markets for much of 2017.
they said. hoping for more options in the domestic
You can rely on ICIS for all your oxo-alcohols market intelligence needs
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analysis for the Asian oxo-alcohols market, including breaking news and analysis across the global petrochemical supply chain, enabling you to grasp
price histories and expert commentary to help you petrochemical markets. Our market-moving news the local or regional scenario in a global context. Data
understand the key price drivers and market conditions articles cover production updates, plant capacities, includes import and export volumes, consumption,
and settle your contract prices confidently with access output and shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for oxo-alcohols from 1978 up to 2030.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
Prices, news and analysis for the
Asian petrochemical industry
Prices, news and analysis for the
Asian petrochemical industry
With developments in Asia affecting wider markets, it is important to gain
access to accurate and thorough market intelligence direct from the region.
ICIS keeps you updated on developments in one of the worlds most exciting
With
regiondevelopments in Asia
by providing the affecting wider markets, it is important to gain
following:
access to accurate and thorough market intelligence direct from the region.
Pricing information
ICIS keeps you updated on developments in one of the worlds most exciting
Asian price assessments and market analysis, published daily and/or weekly,
region by providing the following:
enable you to understand price drivers and fluctuations, and use benchmark
prices ininformation
Pricing your contract settlements. Historical pricing data is also available
which you can incorporate into your own analytical models to guide you
Asian price assessments and market analysis, published daily and/or weekly,
in your forecasting
enable you to understand price drivers and fluctuations, and use benchmark
prices
News in your contract settlements. Historical pricing data is also available
which you can incorporate into your own analytical models to guide you
24-hour coverage of breaking news in Asia, including production updates
in your forecasting
on capacity, output, and shutdowns, gives you the information you need
as it happens
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Dedicated coverage for China, giving you access to supply/demand data,
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ICIS coverage of the Asian markets includes:
impact other markets in Asia
Aromatics Feedstocks Olefins
ICISBase Oils/Lubes
coverage Fertilizers
of the Asian markets includes: Oleochemicals
Biofuels Fibres Plastics/Polymers
Aromatics Feedstocks Olefins
Coal Gas/LNG Rubber
Base Oils/Lubes Fertilizers Oleochemicals
Crude Oil Intermediates Solvents
Biofuels Fibres Plastics/Polymers
Coal Gas/LNG Rubber
Crude Oil Intermediates Solvents
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AROMATICS
BENZENE
ASIA BENZENE PLAYERS TO SEEK for CFR China market in 2017. Impact from new supply on the market is
POCKETS OF OPPORTUNITIES likely to be towards H2 2017 rather than H1
By Daphne Ho We were surprised as well with the term 2017 as we have to wait until new plants
results, but nonetheless it is good news, stabilise their productions and it will take
SINGAPORE (ICIS)--Asia benzene players said a producer. time, said a southeast Asia-based trader.
will be seeking pockets of opportunities
in 2017 as the market juggles between In 2016, prices were supported mainly Market players are also cautious about
new capacities as well as maintenance because of heavy maintenance schedule overestimating actual production output
turnarounds at upstream and downstream from South Korea and strong demand from from the new plants as the bigger plants
plants to balance out long supply conditions China am amid heavy styrene monomer might not run at full capacity after starting
amid higher demand. (SM) capacity expansions. up due to technical reasons or the market
conditions.
An unexpected strong performance in the In addition, calculated increase in
benzene spot market in the fourth quarter consumption outweighed increase in supply Saudi Arabias Petro Rabigh and Sadara
of 2016 has led players to reassess their in 2016 because of multiple delays in start- downstream integrated units are expected to
outlook for 2017. ups from the Middle East and India plants, reduce benzene surplus in the spot market.
and low benzene output from the Hyundai
The market was shocked by the aggressive Chemical plant after its start-up, which was Sadara Chemical will have an integrated
bids seen during free on board (FOB) estimated at 60-65% of nameplate capacity. MDI unit which on paper will likely consume
contract negotiations in the last quarter. all of its benzene production.
Please see below the list of benzene plants
Initial 2017 term ideas exchanged in that started up in 2016 with nameplate Petro Rabigh II also has a phenol plant, which
October were stable-to-soft against 2016 capacity versus their actual output. is likely to consume half of its benzene output.
term prices as market players believe that
there would be more downward pressure
as the structurally long Asia market will face
new capacities coming up in 2017.
With negotiations deadlocked into late Similarly, here is a list of downstream units
December and buy-sell indications proving that started up in 2016 with nameplate
difficult to narrow in, there were lesser than capacity versus actual output.
initial expected contractual volumes fixed
for the China market for 2017. There continues to be uncertainty in the
start-up period of new benzene plants in
With greater demand expected from 2017, shifting the impact of these new
downstream expansions, lesser contractual capacities later.
volumes fixed indicate greater spot activities
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
The first half of 2017 will also see several maintenance thus not needing feedstock Market players estimate that downstream
turnarounds, though fewer as compared to benzene. conditions are unlikely to defer largely from
the same period of 2016. 2016 and that run rates for downstream
South Koreas production loss of SM is units in 2017 - outside of turnaround periods
Hanwha Total will be shutting its estimated to be at 250,000 tonnes for - are likely to stay stable or to improve.
420,000 tonnes/year benzene unit for March, 350,000 tonnes for April and
debottlenecking in May for 50 days, which 865,000 tonnes for May as Lotte Chemical, SM and MDI margins are expected to
will add 80,000 tonnes/year additional LG Petrochemical, Hanwha Total and maintain well above break-even spreads
production when it is brought back on line. YNCC shut their units for maintenance. and caprolactam spreads are likely to
improve with supply consolidation, but
Korea Petrochemical Industry Co (KPIC) There are no turnarounds for phenol units in phenol spreads against benzene are likely
will be shutting its 160,000 tonnes/year Korea planned in the first half of the year. to stay marginal.
benzene unit for debottlenecking during
April/May which will increase its production However, the longer supply from Korea New capacities could also establish liquidity
by around 80,000 tonnes/year. could be offset by lower net surplus of in trade routes, where more outflows from
benzene in Japan in the second quarter. India are likely to move into China.
SK Global Chemical (SKGC) pygas units in
Ulsan with 230,000 tonnes/year combined It looks particularly tight during second With strong Chinese demand, outflow of
capacity will be shut in the second half of quarter for Japan with excess benzene southeast Asia cargoes to China could
March for 40 days. balance hovering at around 30,000 tonnes, become a norm in 2017 as well, similar to
said a Japan-based trader. the situation in the second half of 2016,
South Koreas S-oil will also be having resulting in a balanced-to-tight market for
a turnaround at its 300,000 tonnes/year In the second quarter, there are many the structurally long southeast Asia region.
Onsan unit in the second quarter of 2017 benzene units scheduled for maintenance
for around 45 days, according to in Japan, outweighing the downstream In 2017, the benzene market is expected to
market sources. turnarounds from SM, Phenol and remain robust with producers, traders and
cyclohexane units. buyers having to remain creative in their
On the other hand though several ways to diversify risks, expend profits and
downstream SM units will also be shut for increase their influence on the market.
You can rely on ICIS for all your benzene market intelligence needs
ICIS offers regional price assessments and market analysis for the Asian Anticipate where the domestic Chinese benzene market is heading and create
benzene market, including price histories and expert commentary to help you robust plans for production and investment activities. The study also includes
understand the key price drivers and market conditions and settle your contract supply and demand forecast data, import/export levels, capacity expansion plans,
prices confidently with access to time-sensitive offers, bids and price movements. downstream demand overview and outlook, as well as analyses on key issues
and developments in the market.
Request your free sample report Enquire about the ICIS China Benzene Annual Study
ICIS publishes monthly forecast reports for Be the first to find out about benzene-related Receive an end-to-end perspective across the global
selected commodities showing a 12-month rolling breaking news and analysis across the global petrochemical supply chain, enabling you to grasp
price forecast as well as details of supply and petrochemical markets. Our market-moving news the local or regional scenario in a global context. Data
demand, trade balances, capacity and margins. It is articles cover production updates, plant capacities, includes import and export volumes, consumption,
a valuable tool to identify commercial opportunities output and shutdowns, plus so much more. plant capacities, production and product trade flows
in the short to mid-term. for benzene from 1978 up to 2030.
Enquire about the forecast reports Request your free trial today Enquire about the supply/demand database
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
AROMATICS
TOLUENE
ASIA TOLUENE POISED FOR been increasing at a much slower pace toluene di-isocynate (TDI), benzoic acid,
SHORT-TERM UNCERTAINTY because of the consistent depreciation of benzyl chloride, solvent have been stable
By Trixie Yap the yuan currency against the US dollar. since the third quarter of 2016.
SINGAPORE (ICIS)--Asias toluene prices This, in turn, has resulted in concerns of While there are talks among Chinese
are poised for an uncertain first quarter whether Chinese domestic prices will be market players that local gasoline blending
on concerns over a potentially overheated able to keep up the pace with FOB Korea demand will improve ahead of the Lunar
market since early December amid prices in the short run. New Year period, the presence of other
unchanged Chinese demand despite the more affordable blendstocks such as mixed
recent downstream benzene price rally, If local prices do not move fast enough, aromatics, alkylated oil and methyl tertiary
market participants said. there will be closed arbitrage spread butyl ether (MTBE) is making it difficult for
between import parity prices of domestic toluene to be placed into the blending pool.
Both FOB (free on board) Korea and yuan- cargoes and CFR [cost & freight) China
denominated prices have been consistently discussions, and Chinese importers will not China goes on holiday on 27 January for
rising day on day from 1st December to 12 be able to take January cargoes easily, a almost a week for Lunar new Year holiday.
December, according to ICIS data. southeast Asian trader said.
All these factors indirectly mean that short-
Market players have attributed this mainly Furthermore, market expectations of term demand growth for toluene could be
to the improvement in trading sentiment increasing supply from local producers in heavily dependent on the operating rates of
against rises in international crude values both the east and northeast China regions selective toluene disproportionation (STDP),
and futures market on the commodity stock have led market players to wonder if yuan- TDP or hydrodealkylation (HDA) units.
exchange in China. denominated prices will be able to keep
up with FOB Korea price movements. (see Buyers in other downstream sectors may
FOB Korea prices have risen by at least table for expansion list) even feel deterred from procuring more
14% in that 12-day period, according to toluene if their margins start to become
ICIS data. Prices were last higher in end-While shoretank inventories may not be squeezed because of the recent price run-
July 2015, the data showed. high [at 40,000-50,000 tonnes], we need to up, one south China-based trader said.
bear in mind that prices were only so high in
Yuan-denominated prices, likewise, have November 2015 because inventories Buoyant downstream benzene prices from
added 15.9% from almost two weeks of run- had almost fallen to 25,000-30,000 tonnes, end-November to early December - which
up to the highest point at CNY6,175/tonne that sort of level, an east China-based have resulted in potentially higher toluene
ex-tank on 12 December. trader said. disproportionation [TDP] run rates amid
better margins - upstream crude prices
Early November 2015 was the last time Other than the strong performing and producers insistence of limited spot
prices were this high, ICIS data showed. downstream benzene market, downstream availability for January were key reasons for
plant operating rates for sectors such as toluene price gains in the short run.
Despite gains in both regions prices in early
December, yuan-denominated prices have
CNOOC Huizhou (2nd facility) Huizhou, China reformate 350 May-June 2017
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
The potential for further price gains or at
least price stability is high if the toluene-
benzene spread remains wide because it
will allow cap toluene supply in the short
run if all integrated facilities run their
downstream units higher, one northeast
Asia-based trader said.
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price histories and expert commentary to help you petrochemical markets. Our market-moving news the local or regional scenario in a global context. Data
understand the key price drivers and market conditions articles cover production updates, plant capacities, includes import and export volumes, consumption,
and settle your contract prices confidently with access output and shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for toluene from 1978 up to 2030.
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AROMATICS
STYRENE
ASIA STYRENICS UPTREND COULD Other styrenic resin polystyrene (PS) had Expandable PS (EPS) continued to face the
EASE IN FIRST QUARTER 2017 a harder time matching the uptrend in SM weakest demand among styrenics resins,
By Clive Ong values. Nonetheless, suppliers were mostly with suppliers lamenting squeezed margins,
successful in implementing increments over slow sales and inventory build-up. Suppliers
SINGAPORE (ICIS)--Asias styrenic the past several weeks. have reduced output with the average
resins prices may ease in the first quarter operating rate in China slipping below 50%
of 2017 as market activity is expected to But demand is expected to wane in in November.
slow down with players along the supply the early parts of 2017 before a more
chain currently flushed with stocks, industry substantial rebound to take place in the The key downstream construction sector in
sources said. second quarter, according to sellers. northern and eastern China has slowed with
the onset of cold weather in those regions.
Trading is expected to slow down ahead of We have to target higher price each week
the Lunar New Year holidays across Asia in to maintain workable margins, said a Demand for EPS is usually slow during
late January. producer in Taiwan. winter, said a producer in Taiwan.
It is good for the market to pause in However, with fourth-quarter prices now Apart from the construction sector, the
January as stocks have built up among more elevated than in the previous three packaging sector also reduced consumption
dealers and distributors, said a China- months, some sellers expect increased of EPS as the manufacturing-for-exports
based trader. difficulty in achieving even higher numbers season in China has already passed.
in January to March 2017.
Styrenic resins have enjoyed a strong run- We will probably see a significant pick up in
up post the US elections in early November, PS prices are now at the highest point of EPS demand from the second quarter next
mainly due to higher feedstock styrene the year; buyers will likely seek alternative year, said another producer in Taiwan.
monomer (SM) values. resins if prices increase further, said a
producer in SE Asia. EPS resins are used for packaging and as
Expectations of stronger economic insulation panels in buildings and roads.
growth in the US, propelled by the PS resins are used for packaging, toys,
incoming administrations plan to stimulate consumer electronics and a variety of
the economy via a massive fiscal consumer items.
expenditure, which could boost Asias
economic expansion, lifted prices of many
commodities and petrochemicals.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
TIGHT SUPPLY TO BUOY UP ASIA In the US, several plants are also heard to price, although they conceded that supply
STYRENE MARKET IN H1 be shutting down in the first quarter of 2017 would be tight for the first half of the year.
By Clive Ong for maintenance, reducing availability of
deep-sea cargoes bound for Asia, market Nonetheless, they expect availability of spot
SINGAPORE (ICIS)--Spot styrene sources said. cargoes to be ample in the second half,
monomer (SM) prices in Asia are expected given less plant maintenance scheduled
to buoyed up by tight supply in the first half Contract negotiations conducted under this for this period while several new plants in
of 2017, market sources said. scenario has prompted suppliers to ask an China are expected to come on stream.
additional $2/tonne over the 2016 contract
Weekly falling inventories in the key eastern prices. The supply of SM in the second half of
China market has stoked concerns that next year looks much less tight than the first
availability will be snug into the first quarter Suppliers have offered an additional $2/ half, said an end-user in southeast Asia.
of next year. Inventories have fallen under tonne over this years [2016] contracts for
80,000 tonnes since late October, ICIS data CFR-based terms, said an end-user in SM is a liquid chemical used to make resins
showed. Taiwan. like polystyrene (PS) and acrylonitrile-
butadiene-styrene (ABS), as well as synthetic
Tight supply into the first quarter of next Buyers remained unconvinced and were rubbers such as styrene-butadiene-rubber
year is keeping price buoyant, said a trader lobbying for a roll-over of 2016 contract (SBR) and styrene-butadiene-latex (SBL).
in China.
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drivers and market conditions and settle your contract prices confidently with supply and demand forecast data, import/export levels, capacity expansion plans,
access to time-sensitive offers, bids and price movements.. downstream demand overview and outlook, as well as analyses on key issues
and developments in the market.
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much more. product trade flows for styrene from 1978 up to 2030.
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AROMATICS
PARAXYLENE
ASIA PX OUTLOOK DEPENDS ON downstream purified terephthalic acid (PTA) In 2016, Asia has seen only about 1m
NEW CAPACITY, PTA RESTARTS capacities attempting to restart from the tonne/year of new PX capacity coming
By Paul Lim second quarter onwards. online in India, as Reliance Industries
brought its new 2.25m tonne/year PX unit
SINGAPORE (ICIS)--Asia paraxylene (PX) They were also of the opinion that new PX in Jamnagar on stream in December and
market fundamentals for 2017 will likely capacities will also be slower to come on slowly ramped up operating rates.
hinge new production capacities coming stream.
on stream and on downstream purified This brings the total capacity of PX in the
terephthalic acid (PTA) restarts. PetroRabigh Phase IIs 1.25m tonne/ region to around 48m tonne/year.
year PX unit start up can be delayed and
The market will see some tightness in 2017 on-spec production expected in the fourth In 2017, an additional 3.4m tonnes/year of
during peak demand season, especially for quarter of 2017, with supply reaching the new PX capacity is expected to come on
Asian-origin cargoes heading to northeast market only in 2018. stream in the region.
Asia, while open-origin cargoes will likely
see supply lengthening. However, Nghi Son Refinery and Reliance Industries plans to bring its unit to
Petrochemicals could still bring its 680,000 full throughput and PetroRabigh II and Nghi
Producers are of the opinion that PX could tonne/year PX unit on stream in the third Son Refinery and Petrochemicals will attempt
be tighter in 2017, due to news of major quarter of 2017. to bring their new PX start ups on line.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
an extensive turnaround in the first quarter Traders who have PX cargoes on hand are Huabins 1.4m tonne/year No 4 PTA line
of 2016. It is also skipping turnarounds in harbouring bullish sentiments, optimistic and one of Xianglu Petrochemicals 1.5 m
2017. that the possible restarts of these idled PTA tonne/year PTA line do start up.
units will mean more demand for import
Naphtha-based refiners had enjoyed cargoes into China, as domestic Chinese If domestic supply is diverted to local units
comfortable margins in 2016. As the new PX trade flows could see some changes. which restart, causing an incumbent major
capacities come on stream, it will remain to end-user to go to the merchant market to
be seen whether the margins will continue A new supply stream of isomer-grade mixed purchase spot cargoes
to remain at such high levels, a producer in xylene coming out of Hyundai Chemicals
Asia said. new 1m tonne/year unit has also led to However, the market situation will depend on
expectations that 2017 will be a better their exact restart dates and operating rates.
Market sources are watching keenly year for MX-based PX producers, such
whether downstream PTA units in China as Lotte Chemical and Hyundai Cosmo Most market sources are in agreement that
like Huabin, Fuling Pengwei and Xianglu Petrochemical, which have typically seen market fundamentals would change only
Petrochemical will start up on time. uneconomical MX-PX spreads. from the fourth quarter of 2017, as new PX
capacities come online and the full supply
There have been mixed news on whether However, sources said that MX-based PX hits the market in 2018. Contract alphas are
these units could restart, as there were no producers will likely increase run rates expected to see further changes from 2018.
physical sales outlets readily available, and in 2017, leading to an overall higher PX
transport and logistics issues will increase operating rate in Asia, with a possible There are even more start ups in the Middle
their operating costs. restart of a northeast Asian MX-based PX East and China due from 2018 onwards.
line in 2017.
The protracted discussions between Market sources said there were continued
a state-owned refiner and Xianglu There are also fewer turnarounds, as negotiations for contract alphas, although
Petrochemicals owner over stake key producers had performance major some producers were holding out for a
holdership were also limiting chances of the maintenances on their units in 2016. rollover of last years contract alphas as they
PTA plant starting up. were of the view that market fundamentals
In the Chinese Yuan-denominated PX would change only from 2018.
However, sources said Huabin had higher market, domestic producers in east China
chances of starting up a 1.4m tonne/year said market fundamentals could see some Discussions ranged from minus $2.50/tonne
PTA line in 2017, as its new owners were improvement with increased demand from for Asian-origin cargoes to up to minus $4/
keen on recouping the money it had spent end-users which had been previously flat. tonne for open-origin cargoes.
on buying over the business.
The RMB market could trend towards Buyers are still resistant to a rollover in
A manageable PX-PTA spread will also tightness if idled producers such as Fuling prices, taking into account new open-origin
encouraged its restart. Pengweis 900,000 tonne/year PTA line, supply hitting the market late 2017-2018.
Turnaround schedule
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
This year will also see a new entrant into with end-user Shenghong Petrochemical Reliance Industries said in a statement that
the Asia Contract Price negotiating circle, set to join negotiations from January 2017. it will also join ACP talks from April 2017.
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analysis for the Asia paraxylene market, including breaking news and analysis across the global petrochemical supply chain, enabling you to grasp
price histories and expert commentary to help you petrochemical markets. Our market-moving news the local or regional scenario in a global context. Data
understand the key price drivers and market conditions articles cover production updates, plant capacities, includes import and export volumes, consumption,
and settle your contract prices confidently with access output and shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for paraxylene from 1978 up to 2030.
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AROMATICS
MIXED XYLENES
ASIA ISOMER-GRADE XYLENES Upon its start-up, the company had mostly lower than regional material, denting
MAY SEE NEW TRADE FLOWS increased export and contractual volumes import demand.
By Hazel Kumari to South Korean and Chinese buyers,
according to a source. A lack of support from the gasoline blending
SINGAPORE (ICIS)--Asian isomer-grade sector had added to the supply glut of
xylene market is expected to follow Showa Shells new toluene disproportionate isomer grade xylene in 2016.
its upstream crude and downstream (TDP) unit in Yokkaichi, with an isomer-
paraxylene (PX) markets though the grade xylene template capacity of 200,000 In South Korea, Hyundai Chemical, a joint
existing supply overhang will create new tonnes/year, started production in July. venture between Lotte Chemical Corp
trade flows as traders will be looking at and Hyundai Oilbank started commercial
other markets to relieve their inventories. As domestic demand is expected to remain operations at its new 1m tonne/year isomer-
stable-to-slightly weaker due to the lack of grade xylene facility in October.
Asia, which is traditionally a tight-supplied downstream expansions, producers will try
market, saw capacity increases and a to increase their contractual commitments The unit achieved maximum output by
new plant start-up in 2016 amid stable for 2017, according to sources. November with all output delivered to
downstream demand. Lotte Chemical and Hyundai Cosmo
Japanese producers typically start term Petrochemical (HCP) to be used as a raw
Subsequently, demand for US-origin discussions in February. material for their downstream PX units.
cargoes saw a decline in the latter half of
the year. Most players expect the trend to In China, supply has increased with As a result, these two end-users would
continue this year. expansions at two aromatics plant and two be adequately covered with cargoes from
new start-up. Hyundai Chemical and term volumes which
On the other hand, some traders might will reduce their spot demand.
start sending more cargoes towards the Ningbo Daxie Petrochemicals new plant
US region as year-over-year growth in in Zhejiang yielded on-spec cargoes in There were talks in the market that these
gasoline consumption against a back-drop the first haf of June. The company is able end-users will be looking to reduce their
of a healthy crack spread and stable-to- to produce 340,000 tonne/year of missed contractual volumes with other suppliers in
firm crude oil fundamentals would increase xylenes (MX) and has been selling products 2017.
demand for gasoline blending components. to domestic eastern Chinese buyers.
China will see further capacity increase of
In the US, mixed xylenes (MX) is used as Zhuhai Changlian started commercial over 1.2m tonne/year in 2017 following the
an octane booster in gasoline. operations at its 300,000 tonne/year MX commissioning of an expansion and start-
plant in Guangzhou in June and has been up of two plants.
Some traders are looking for new outlets to supplying to southern Chinese players.
reduce the surplus supply within northeast CNPC Huizhou Refining II is planning
Asia. Already, we have seen some cargoes CNOOC Huayue aromatics unit began MX to integrate 700,000 tonne/year of MX
being sold to the US in October and that is production at its 93,600 tonne/year plant in production with its refinery. According to
going to be the new norm, said a northeast June and achieved on-spec material in July. market sources, the company would be
Asian trader. diverting some of the cargoes towards its
According to market sources, the company is downstream plants.
In the last half of 2016, aromatic expansions diverting most of its production to captive use.
in Japan and China amid continued PetroChina Yunnan will be adding a new
weakness in the global economy had CNOOC Taizhou Petrochemical has started mixed xylenes extraction unit to reduce
lengthened supply of isomer-grade xylene. trial operations at its new reformer in dependence on the spot market and exposure
November but was unable to succeed due to volatile conditions for the feedstock.
Capacity expansion and new plant start- to mechanical difficulties.
ups, totalling close to 2.4m tonne/year The plant will be able to produce 530,000
has added length to supply even as Asian The company was planning to retry in mid- tonne/year of MX in the first quarter of 2017.
producers were already grappling with December with commercial operations due
excess capacity and weakening market for the first quarter of 2017. However, there Demand growth for isomer-grade xylene is
conditions in the overall polyester chain. was no latest update available on the plants expected to lag the gain in supply amid a
status. The reformer has the capacity to lack of incremental PX consumption.
In Japan, Tonen General had started produce 220,000 tonnes/year of MX.
commercial sales of isomer-grade xylene Indian producer, Reliance Industries (RIL),
since June from its new 230,000 tonne/year As supply in China was deemed ample, will be starting its new 2.3m tonne/year PX
recovery unit in Ichihara. discussions for domestic cargoes were unit in Jamnagar in January.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
Previously, RIL was expected to start seeking additional spot cargoes from the Others were expecting demand to improve
production by the end of October to reach spot trading arena. as Chinese and Taiwanese end-users will
optimum operating rates by December be looking to build inventories ahead of the
but encountered issues which delayed the Despite the absence of a material Lunar New Year holidays in end-January.
start-up. improvement in downstream demand, the
evident strength in benzene prices had Looking ahead, several derivative purified
Saudi Arabias PetroRabigh 1.3m tonne/ propped sentiment amongst traders in the terephthalic acid (PTA) makers were looking
year unit in Saudi Arabia has been pushed aromatics chain. to restart production at their plants following
to the third quarter of this year due to delays supply shortage and healthy margins, which
in construction of the plant. Toluene prices had surged above isomer- would increase consumption of feedstock
grade xylene, encouraging some traders to PX.
However, demand for January and seek the cheaper alternative for the solvent
February spot isomer-grade xylene cargoes markets. On that basis, some traders expect the
firmed due to regional maintenances and improvements in the PTA market to have a
short position covering. The recent volatilities in benzene, toluene domino effect on isomer-grade xylene.
and downstream paraxylene (PX) markets
On 11 December, isomer-grade xylene bids had encouraged some traders to hedge If some of these PTA makers truly restart
for January loading broke the $700/tonne their risks with the less sought after as they said they would after Lunar New
FOB (free on board) Korea mark after hikes aromatic product, according to a northeast Year, this would definitely encourage
in the upstream and downstream market Asian producer, explaining the recent PX producers to ramp up their output,
had bolstered sentiment amongst players. improved demand for isomer-grade xylene. especially within China. Domestic prices
would rise making South Korean and
The last time isomer-grade xylene was Some players said they were looking to Japanese cargoes more attractive, said a
assessed above $700/tonne FOB Korea stockpile ahead of the shutdown as they northeast Asian producer.
was on 4 November 2015, according to expect term volumes for March to decline.
ICIS data. There were no bids or offers
in the market for January cargoes since In addition, they were expecting an increase
Christmas. The assessment on 3 January in downstream demand from Taiwan due to
was $697-703 FOB Korea. the shutdowns.
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understand the key price drivers and market conditions articles cover production updates, plant capacities, includes import and export volumes, consumption,
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Pricing intelligence to propel
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ASIAN PTA MAJORS TO WRESTLE reduce operating rates further, an industry start-up of JBF Industrys 1.1 m tonne/year
FOR GLOBAL MARKET SHARE observer said. PTA lines sometime in late H1 2017 will also
By Paul Lim increase Indias PTA production capacity to
A possible reduction of run rates at some 7.2 m tonne/year.
SINGAPORE (ICIS)--Asian purified northeast Asian PTA plants will likely be
terephthalic acid (PTA) in China and India are offset by restarting idled capacities in Indias domestic consumption is estimated
expected to battle each other this year in order China, where Zhejiang Huabin is targeting to be about 5m tonnes/year. With domestic
to further their global shares as domestic to restart a 1.4m tonne/year PTA line in Q2 demand fully fed by Reliance Industries,
markets become increasingly saturated due to 2017. Market sources said Fuling Pengwei Materials Chemicals and Performance
new production capacities coming on stream, are also trying to restart its 900,000 tonne/ Intermediaris (MCPI) and Indian Oil
according to industry players. year PTA line in Q1 2017. Corporation (IOC)s units, it must now look
towards export outlets.
With massive production capacities While Xianglu Petrochemical was targeting to
and logistical and production economic restart a 1.5 m tonne/year PTA line sometime PTA producers in India have the logistical
efficiencies on their side, the producers in in 2017, there has been no confirmation as to advantage to export cargoes to the Middle
India and China are offering prices which how its discussion of a stake sale with state- East markets, given the countrys proximity
are hard to beat, especially if compared to owned refiner Sinopec was unfolding and to the region compared with China and
smaller, non-integrated PTA units elsewhere that a firm restart date was unclear. South Korea. The Middle East is where
in Asia. Indian PTA producers have been successful
Jiaxing Petrochemical (Tongkun Group) is in 2016, fulfilling the demand of large-
The strong competition among these key looking to start up its new 2.2 m tonne/year volume tenders from buyers.
suppliers for 2017 term contracts has PTA facility in Q4-2017.
translated to lower prices for global end- The ICIS FOB northeast Asia (NE Asia)
users, market sources said. In India, former major importer India has quote is expected to continue gaining more
now turned into a net exporter, moving traction in 2017, after seeing multiple deals
Market sources said these large-capacity regular volumes to the middle Eat. The transacted on an FOB NE Asia basis in
producers had offered steeper discounts
from 2016 in a bid to secure customers.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
2016. Producers are now considering it a viable price benchmark alongside the veteran CFR China benchmark quote.
Spot buyers of FOB NE Asian cargoes are expected to remain in the market next year, as Asian-origin cargoes continue to head to
Europe, the Middle East, Russia and the Americas. Demand especially spikes when there are production issues at domestic PTA plants,
or when significant arbitrage opportunities arise.
The liquidity of export deals will at times surpass the number of imported CFR or Ex-China Main Port (CMP) deals, depending on the weeks
market situation. The number of market participants in the FOB NE Asia market is also substantial, with healthy trading competition between
sellers in the region.
FOB NE Asia prices typically command some premiums to the CFR or ex-CMP prices, due to logistical considerations.
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analysis for the Asian PTA market, including price news and analysis across the global petrochemical petrochemical supply chain, enabling you to grasp
histories and expert commentary to help you markets. Our market-moving news articles cover the local or regional scenario in a global context. Data
understand the key price drivers and market conditions production updates, plant capacities, output and includes import and export volumes, consumption,
and settle your contract prices confidently with access shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for PTA from 1978 up to 2030.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
FIBRE INTERMEDIATES
POLYETHYLENE TEREPHALATE (PET) AND RECYCLED
POLYETHYLENE TEREPHALATE (R-PET)
ASIA PET OVERCAPACITY CLOUDS A third Chinese producer, Hainan Yisheng As the market remains in overcapacity,
2017 PROSPECTS, R-PET STEADY Petrochemical is planning to start up one and the new production will be coming
By Hazel Goh 250,000 tonne/year plant in March 2017, from China, some local producers feel that
and one more 250,000 tonne/year unit the average operating rates in the country
SINGAPORE (ICIS)--Asian polyethylene in June 2017. Both plants are in Hainan, will likely be reduced to around 70% as
terephthalate (PET) market overcapacity China. compared to the previous years level of
continues into 2017, and is likely to worsen around 80% capacity.
with the additional plants due to come on Lastly, there is a separate 500,000 tonne/
stream, and this might put pressure on its year capacity in Jiangyin, Jiangsu, China Meanwhile, Japan and Indonesia are
prices. under the Chengxing Group looking to start investigating Chinese material imports for
up in the first quarter of 2017. anti-dumping duty (ADD).
Asias bottle grade PET supply capacity
recently increased by 0.3m tonnes/year If all these capacities were to start up Some market participants think that this
upon the startup of China Resources according to plan, the Asia supply will may result in a change in trade flow if the
Changzhou Petrochemical (CRC) plant in add up to around 17m tonnes/year by the ADD were to be imposed, as Chinese
Zhuhai, China in October 2016. middle of 2017 and the global supply to producers may lose their market share in
become near 31m tonnes/year. these countries and gain market share in
There are several other new capacities other markets.
looking to start up in China in the first On the other hand Asias demand is
quarter of 2017, one of which is 500,000 expected to rise by an average of around On the topic of ADD, the European Union
tonne/year capacity in Jiangyin, Jiangsu, 6% to roughly 9m tonnes/year. (EU) had recently reviewed and officially
China from Jiangsu Sanfangxiang Industrial withdrew the ADD imposed on Chinese
Group that had its startup date postponed Demand growth rate will be higher in material, which will take effect in February
from 2015 originally. developing countries as traditional beverage 2017.
packaging material such as glass are in the
A separate plant looking to start up in the process of gradually being replaced by PET. However, some Chinese producers are
first quarter of 2017 is 550,000 tonne/year not too excited on this piece of news
capacity in Haining, Zhejiang, China by The global PET demand is estimated to since there will still be import duty of
Zhejiang Wankai New Material. stand at around 22m tonnes/year in 2017. 6.5% imposed on Chinese material and
Chinese producers are still going to be at
a disadvantage as compared to Korean
producers whose material is at zero import
duty when selling into the EU.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
In a related market, the recycled PET
(R-PET) outlook for China seems balanced
for 2017 as it is usually a relatively calm
market.
Downstream recycled polyester converters outlook going into 2017 for January and The producer is inclined to recycle and
have said that they will continue to keep February. produce higher quality R-PET with higher
their productions steady into 2017, apart purity, as it usually fetches better netback
from some which will be shutting for around Moving forward, there is a general gradual margins.
10 days for the upcoming Lunar New Year direction of producers moving to make
holiday in January. higher quality R-PET. A separate Taiwanese R-PET producer
had adjusted its plant conditions to produce
Amid the general good market sentiment in A Thai R-PET producer is looking to expand higher purity R-PET in 2016, citing that
the fourth quarter, some market participants its recycling facility that is expected to be margins were too thin to justify for the
are cautiously optimistic about the market ready in 2017. production of lower quality R-PET.
You can rely on ICIS for all your PET market intelligence needs
ICIS offers regional price assessments and market Be the first to find out about PET-related breaking Receive an end-to-end perspective across the global
analysis for the Asian PET market, including price news and analysis across the global petrochemical petrochemical supply chain, enabling you to grasp
histories and expert commentary to help you markets. Our market-moving news articles cover the local or regional scenario in a global context. Data
understand the key price drivers and market conditions production updates, plant capacities, output and includes import and export volumes, consumption,
and settle your contract prices confidently with access shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for PET from 1978 up to 2030.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
FIBRE INTERMEDIATES
MONOETHYLENE GLYCOL (MEG)
Average Asia MEG spot prices rose $699.5/ Traditionally, sharp price hikes were not Chinas gross domestic product (GDP) has
tonne CFR (cost & freight) China Main Port expected in December unless there were been trending down since 2014 and most
(CMP) by end March 2016 from $580.5/ drastic shifts in macroeconomic conditions. market participants expect that trend to
tonne CFR CMP in early January 2016, continue in 2017, albeit at a gentler pace as
according to ICIS data. As such, some market participants were the economy stabilises.
attributing the gains to a boost in some
However, prices began to decline from aspects of Chinas economy such as higher This would likely translate into slower growth
April 2016 onwards, falling to an average fiscal spending or better domestic retail for downstream polyester markets which is
of $604/tonne CFR CMP by end May 2016 performances. mainly used for consumer products.
and were fluctuating frequently within $605-
660.5/tonne CFR CMP until October 2016, In 2017, MEG supply is expected to lengthen Bearish macroeconomic conditions outside
ICIS data showed. upon the start-up of Reliances 750,000 China would also be challenging for
tonnes/year MEG unit in India. The unit is polyester producers as export volumes may
MEG prices may have been mirroring price targeted to come on board by the first quarter see a decrease.
movements of upstream crude futures of 2017. The plant is expected to cater to
values as crude prices had also rising and Indian domestic consumption of MEG. Nonetheless, domestic growth for polyester
falling rapidly within the $40-50/bbl range, demand would likely continue to be the
some market participants said. The start-up India is likely to remain as a net importer of main driver for polyester growth.
of a new MEG facility in Iran also added MEG given the expected growth in Indias
pressure on prices. polyester sectors. Import volumes have fallen in 2016 largely
because of production cut-backs in major
In the fourth quarter of 2016, MEG prices Tradeflow, meanwhile, is expected to be ethylene glycol production facilities, market
began an uptrend, reaching new yearly impacted by the new plant as a portion of players said.
highs for the month of December 2016. MEG MEG volumes currently being exported
spot prices rose from $622/tonne CFR CMP to India may have to re-diverted to other Despite the start-up of a new MEG plant
in end September 2016 to above $815/tonne regions. in Iran, import volumes have continued to
CFR CMP in early December 2016. decline throughout the year.
For major market China, demand for MEG
The performance of downstream polyester is likely to be tapered going forward as Imported MEG adds up to around 70% of
fibre and yarn sectors may have been Chinas economy maintains its slower the total MEG consumption in China and
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
most market participants do not expect used in the polyester markets as compared In the near term, supply were expected
a significant change as domestic MEG to conventional naphtha-based or natural gas to be tighter following an unexpected
facilities were expected to continue running based MEG, market sources said. turnaround at a Middle East facility.
at comparatively lower production rates.
Planned turnarounds for maintenance As a result, December loading cargoes
Nonetheless, operating rates for Chinese for regional MEG plants for 2017 were were expected to be delayed.
MEG plants were expected to continue to expected to be largely similar to 2016,
grow and the China market maintains its market participants said. Given that restocking activities were
shifts to a more self-reliant market structure. expected to take place before first half
A major supplier, meanwhile, is expected to of January in view of an earlier Chinese
Operating rates for coal-based MEG in China perform a maintenance shut down at two of New Year, some market participants were
is likely to remain unstable and low in the near its Middle East facilities in the first quarter, concerned about tighter supply.
term because the product is still not as widely from February to March.
You can rely on ICIS for all your MEG market intelligence needs
PRICING INFORMATION ICIS MONOETHYLENE GLYCOL (MEG) ANNUAL STUDY SUPPLY AND DEMAND DATABASE
ICIS offers regional price assessments and market Anticipate where the domestic Chinese MEG market Receive an end-to-end perspective across the global
analysis for the Asian MEG market, including is heading and create robust plans for production and petrochemical supply chain, enabling you to grasp
price histories and expert commentary to help you investment activities. The study also includes supply and the local or regional scenario in a global context. Data
understand the key price drivers and market conditions demand forecast data, import/export levels, capacity includes import and export volumes, consumption,
and settle your contract prices confidently with access expansion plans, downstream demand overview plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. and outlook, as well as analyses on key issues and for MEG from 1978 up to 2030.
developments in the market.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
FIBRE INTERMEDIATES
NYLON
ASIA NYLON FACES CHALLENGING The situation is not expected to improve Many existing nylon producers are wary
YEAR ON GROWING CAPACITY significantly in 2017. that this could prove counter-productive, as
By Leanne Tan the increased production can exacerbate
Meanwhile, producers of nylon materials oversupply in the nylon market and drive
SINGAPORE (ICIS)--Asias nylon faces in northeast Asia have noted that the poor margins further down south.
a challenging year ahead as supply is margins that plagued the caprolactam
expected to continue to grow in 2017 (capro) producers in previous years have Margins were negative for many nylon
despite a persistent lacklustre downstream gradually been transferred downstream to producers in the second half of 2016 as a
demand that industry sources believe will the nylon producers. result of firm feedstock prices.
continue to plague the market in the coming
year. Although the supply of feedstock capro The optimum spread between capro and
has begun showing signs of consolidation, nylon is at around $280-300/tonne, based
Although China remains a major net Asias nylon supply has been rising steadily on market feedback.
importer of the material, market players in contrast.
believe that Chinese import volumes will However, some market players are hopeful
gradually decline in 2017, as the country The supply of nylon chips is expected to that recent upstream capro gains caused
inches towards self-sufficiency amid increase further this year, with more nylon by a tightening of supply can eventually
domestic nylon 6 capacity expansions. polymerization plants scheduled to start-up support downstream nylon prices.
in 2017.
Market players expect that the recent sharp Spot prices of nylon chips were at a
devaluation of the Chinese yuan against the Amongst them, phase II of Petro Rabighs 24-month high late in 2016, as producers
dollar is likely to continue to diminish buying expansion, a joint venture between Saudi raised offers sharply in response to surging
appetite for import cargoes even more. Aramco and Japans Sumitomo Chemical, feedstock capro prices.
is expected to include 75,000 tonnes/year
However, Chinese producers have opted to of nylon 6 production capacity. Furthermore, supply in the near term
keep run-rates low for most of 2016 amid is expected to remain tight, as several
poor margins and weak buying appetite in The plant will be Saudi Arabias first nylon polymerization plants in China and Taiwan
the region. 6 manufacturing facility and is expected to are running below full production capacity.
come on stream in early 2017.
Downstream demand for nylon yarn In Taiwan, several nylon polymerization
and textile products in China remains Market players point out a trend where plants were running at below full capacity
lacklustre because of weak macroeconomic more upstream players are venturing further due to a shortage of feedstock, while
conditions and sluggish growth in the downstream where margins are perceived plants in China have cut their production in
Chinese economy. as better, as seen in the nylon market. preparation of the Lunar New Year holiday
which falls on the end of January.
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for the Asian nylon market, including price histories and news and analysis across the global petrochemical petrochemical supply chain, enabling you to grasp
expert commentary to help you understand the key price markets. Our market-moving news articles cover the local or regional scenario in a global context. Data
drivers and market conditions and settle your contract production updates, plant capacities, output and includes import and export volumes, consumption,
prices confidently with access to time-sensitive offers, bids shutdowns, plus so much more. plant capacities, production and product trade flows
and price movements. for nylon from 1978 up to 2030.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
2017 Asia and Middle East cracker turnaround schedule
Lotte Chemical Titan Pasir Gudang, Malaysia 435,000 (No 2) Shut in H1 Feb for around 45 days
Integrated Refinery Rayong, Thailand 350,000 Shut in early Feb for around 40-45 days
Petrochemical Complex (IRPC)
SK Global Chemical (SKGC) Ulsan, South Korea 190,000 (No 1) Shut in H1 Mar for around 40 days
Shanghai Petrochemical Shanghai, China 700,000 H2 Mar to early May for 45 days
Petrokemya Al-Jubail, Saudi Arabia 800,000 (No 2) Shut in Apr for around 45 days
Korea Petrochemical Onsan, South Korea +330,000 to 800,000 Apr/May for around 45-55 days
Industry Co (KPIC)
PTT Global Chemical (PTTGC) Map Ta Phut, Thailand 515,000 (I-4 No 1) Q2 for around 30-45 days
Asahi Kasei Mitsubishi Mizushima, Japan 570,000 H1 May to end June/early Jul for around
Chemical Ethylene Corp 50 days
Qilu Petrochemical Shandong, China 800,000 Early May to H2 June for 47 days
Yangzi Petrochemical Jiangsu, China 800,000 H2 Jun to mid Aug; No 1 line to shut for
34 days, No 2 line to shut for 52 days
Jubail United Petrochemical Al-Jubail, Saudi Arabia 1.45m June/Jul for around 30 days
Co (JUPC) (to be confirmed)
Lotte Chemical Titan Pasir Gudang, Malaysia 285,000 (No 1) Shutdown of around 40 days postponed
from Apr to likely H2 2017
Formosa Petrochemical Mailiao, Taiwan 1.2m (No 3) End Aug to early Oct for
Corp (FPCC) around 40 days
Saudi Kayan Al-Jubail, Saudi Arabia 1.48m Shut in Oct for around a month
Sichuan Petrochemical Sichuan, China 800,000 Dec 2017 to Jan 2018 for around 30 days
Kasei Chemicals 500,000 tonne/year cracker sellers. This explains why ethylene imports cargoes, sources said.
in Mizushima, as well as healthy downstream in Japan surged to 120,696 tonnes in the
production activity, sources said. first 10 months of the year from just 6,901 Depending on how negotiations go, more
tonnes in 2015. volumes could be diverted from the export
Asahi Kasei mothballed its cracker in market, a trader said.
February and took a stake in Mitsubishi In 2017, the market will see the full impact
Chemicals 570,000 tonne/year Mizushima of the restructured Asahi and Mitsubishis Maruzen Petrochemical a major exporter
plant under the Asahi Kasei Mitsubishi olefins operations, although it is unclear if in Japan will likely have more shipments
Chemical Ethylene Corporation joint the changes will be more on the import or compared to 2016 when the companys
venture that started in April. export front. output was lowered by a cracker
maintenance shutdown, according to a
Both companies which prior to 2016 were Mitsubishi, which has the bigger shortfall of source familiar with the situation.
in a relatively balanced position - covered the two companies, will likely try to obtain
their production shortfalls this year by more cargoes from domestic sources, Tilting the other end of the export scale is
purchasing from domestic and regional which are usually lower-cost than import an expected drop in shipment from another
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
key seller Showa Denko. The Japanese
producer is planning to reduce term
commitment to traders and regional buyers
in 2017 due to higher projected downstream
operations at its Oita complex, according
to market sources. Showas downstream
plants will be running at full tilt in order
to stockpile for a major complex-wide
turnaround in March/April 2018.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
Q4 2016/2017 China standalone ethylene downstream projects
Qingdao Haijing Qingdao, Shandong 400,000 VCM Trial runs at complex during late
400,000 PVC Q3-Nov 2016, started PVC sales in Dec
300,000 EDC
Qingdao Soda Ash Industrial Qingdao, Shandong 500,000 SM Construction to complete in mid-2017,
start up in Q3
around 400,000 tonnes/year if these plants are less sanguine about the 2017 outlook There are in total around 5m tonnes/year
operate fully. ahead of the start-up of Jiangsu Sailboat of new PE capacities coming on-stream in
Petrochemicals 180,000 tonne/year 2017-2018 from a slew of ethane-based
The impact of the new ethylene plant. The facility in Jiangsu is expected integrated projects in the US.
consumption on Chinas import demand will to begin trial operations by January, and if
be offset to a certain extent by upcoming successful, the company will progress to Obviously, China will be the main market.
domestic supply from a methanol-to-olefins start up its MTO plant in February-March. There is no other market big enough to help
(MTO) plant operator that has no ethylene The MTO plant can produce 370,000 absorb such big supplies, a PE producer said.
derivative plants. Fund Energy is said to tonnes/year of ethylene.
be looking at starting up its Changzhou With capacities in the Middle East
plant with a nameplate ethylene capacity In Taiwan, import demand could be growing as well, competition for a share
of 165,000 tonnes/year in late 2016/early boosted in the first half of 2017 by a long of the market in Asia will intensify, with
2017. Its ethylene production will be mainly maintenance shutdown at CPC Corps No repercussions on the operations of naphtha-
consumed by the currently import-reliant 6 cracker and from higher operating rates based integrated complexes.
New Solar Groups SM plants. at two downstream plants that started up
in 2016. USI Corporation started up its PE margins could be undermined, cracker
On downstream market outlook, ethylene- two 45,000 EVA/LDPE swing plants in operators in Asia may struggle to run their
based vinyls producers in China said Kaohsiung since the second quarter but it plants at high rates and some ethylene
they are likely to continue to benefit is still in the process of stabilising the plant producers may have to put more of their
from Beijings stricter enforcement of operations. supply in the merchant market, players said.
environmental standards which have
impacted the operations of carbide-based Taiwans ethylene imports grew to 250,883 Integrated producers in China and South
competitors. Domestic vinyls prices tonnes in January-October 2016 from Korea are likely most vulnerable to the
strengthened during mid- to second-half 179,264 tonnes in the same period last impact of new PE supply from the US and
2016 as producers using calcium carbide as year, while exports fell to 211,983 tonnes the Middle East, they said.
feedstock faced production restrictions and from 251,502 tonnes.
higher upstream coal costs. Japan producers that focus on higher-end
WILL THE TIDE TURN IN LATE 2017? specialty grade PE for domestic market will
SM producers in China expect their margins Low-cost PE exports from the US will likely be the least affected, they added.
to remain healthy next year although the start making their way to Asia in the fourth
market may be less buoyant than this year quarter of 2017, market players said. Late 2017 could be a turning point for
due to new domestic capacities. Chevron Phillips Chemical could be the the ethylene market. It is questionable if
first off the block, with its ethane-based PE the high margins for cracker operators will
Ethylene oxide (EO) producers in China project on track to start up around mid-2017. continue going into 2018, a buyer said.
You can rely on ICIS for all your ethylene market intelligence needs
ICIS offers regional price assessments and market Be the first to find out about ethylene-related Receive an end-to-end perspective across the global
analysis for the Asian ethylene market, including breaking news and analysis across the global petrochemical supply chain, enabling you to grasp
price histories and expert commentary to help you petrochemical markets. Our market-moving news the local or regional scenario in a global context. Data
understand the key price drivers and market conditions articles cover production updates, plant capacities, includes import and export volumes, consumption,
and settle your contract prices confidently with access output and shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for ethylene from 1978 up to 2030.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
OLEFINS
PROPYLENE
On paper, Ningbo Fuji will have a net Some said they may opt to increase their A buyer has a similar concern, saying:
propylene surplus of up to 200,000 tonnes/ spot requirements should contractual While supply in northeast Asia should
year based on the designed capacities of negotiations not go their way. lengthen on paper, reliability of production
the integrated complex. units could throw a potential spanner in the
According to market sources, propylene works so prices would not necessary head
A lack of planned maintenance in northeast export from South Korea is expected to south.
Asia in the months of January and February increase to above 1.6m tonnes in 2017, a
may also add to the notion of a longer supply. slight increase from 1.55m tonnes in 2016. For sellers, pre-lunar New Year restocking
Export from Japan is expected to stay activities in China may yet provide some
We are expecting to see longer supply roughly unchanged at about 1m tonnes. support to spot prices in the first quarter
from China and Korea next year, said of 2017. The Lunar New Year falls on 28
one Chinese buyer. As such, we hope to While buyers have reasons to be optimistic, January 2017.
negotiate a better contract for 2017. spot propylene prices may not weaken at
all, market sources said. In January to March 2016, propylene prices
A few buyers have told ICIS they hope to in northeast Asia increased by 18.0%
start negotiations for 2017 contract cargoes While supply in Asia will lengthen in from the previous corresponding period
at CFR (cost and freight) NE (northeast) theory, cracker run rates may be a bit of a moderating from the 44.7% year-on-year
Asia plus single-digit premiums, compared question mark in 2017, a market participant surge recorded in the same period in 2015,
with low- double-digit premiums in 2016. cautioned. according to ICIS data.
You can rely on ICIS for all your propylene market intelligence needs
ICIS offers regional price assessments and market Be the first to find out about propylene-related Receive an end-to-end perspective across the global
analysis for the Asian propylene market, including breaking news and analysis across the global petrochemical supply chain, enabling you to grasp
price histories and expert commentary to help you petrochemical markets. Our market-moving news the local or regional scenario in a global context. Data
understand the key price drivers and market conditions articles cover production updates, plant capacities, includes import and export volumes, consumption,
and settle your contract prices confidently with access output and shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for propylene from 1978 up to 2030.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
OLEFINS
BUTADIENE
ASIA BD Q1 UPTREND LIKELY above $2,000/tonne CFR NE Asia, and We are confident that the BD price will
DESPITE LUNAR NEW YEAR LULL maybe even hit $2,200/tonne CFR NE Asia hit $2,200/tonne CFR NE Asia, and likely
By Helen Yan early next year as supply is expected to even higher than in early 2017, a regional
remain tight, a regional producer said. producer said.
SINGAPORE (ICIS)--Spot butadiene (BD)
prices in Asia look set to continue their A number of cracker operators in Asia, But there are concerns that the downstream
uptrend in the first quarter of 2017 despite including Malaysia Lotte Chemical Titan, synthetic rubber prices may not be able
the expected lull in market activity in the Petrochemical Corporation of Singapore (PCS) to keep pace with the sharp surge in BD
weeks leading to the Lunar New Year and Taiwans CPC Corp, will shut their BD prices, in spite of strong demand.
holiday in late January, market sources said. units for maintenance during the first quarter.
Demand for synthetic rubber is very strong
Supply is expected to remain tight due to BD spot prices have been on an upward in China as the tyre factories are building up
cracker and BD plant turnarounds in Asia. trajectory since early November, surging inventories, given expectations of stronger
The upward pressure on prices, however, is by nearly 50% from 11 November to 23 demand for tyre replacements in 2017, a
likely to ease slightly since demand typically December, according to ICIS data. Chinese synthetic rubber producer said.
slows down before and during the holiday
that is celebrated in most part of northeast Prices spiked in December as BDs Another producer said: We are targeting a
and southeast Asia, they said. downstream synthetic rubber and acrylonitrile significant increase for the synthetic rubber
butadiene styrene (ABS) plants have ramped prices for January, but it remains to be seen
The Lunar New Year falls on 28 January up production to build up inventories ahead whether the price increases are acceptable
and trading and production activities in the of the Lunar New Year holiday. or sustainable throughout the first quarter
key Chinese market are expected to wind of 2017.
down from mid-January. Market players expect a tapering off of the
price gains from mid-January until after the You can rely on ICIS for
But suppliers have hiked offers for January holiday, which is celebrated for a full week all your butadiene market
BD shipments to $2,200/tonne CFR (cost in China. During this time, Chinas synthetic
and freight) northeast (NE) Asia because of rubber plants are expected to either shut or
intelligence needs
prevailing tight supply and on expectations dial down production rates until mid-February.
of higher crude oil prices in 2017. PRICING INFORMATION
Once players in the key Chinese market
ICIS offers regional price assessments and
On 9 December, BD prices averaged $1,790/ returned, however, BD prices are largely market analysis for the Asian butadiene market,
tonne CFR NE Asia, ICIS data showed. expected to resume their uptrend, market including price histories and expert commentary
to help you understand the key price drivers and
sources said. market conditions and settle your contract prices
We expect BD prices to continue to rise confidently with access to time-sensitive offers,
bids and price movements.
NEWS INFORMATION
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
PHENOLICS/CHLORALKALI
BISPHENOL A (BPA)
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
PHENOLICS/CHLORALKALI
METHYL DI-P-PHENYLENE ISOCYANATE (MDI)
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
While PMDI prices have not moved as Middle East players have also been eager Average MMDI prices surged by a
quickly as toluene di-isocyanate (TDI) for news about additional supply coming cumulative 30%, or $550/tonne in absolute
prices, the price gains were still causing from Sadara Chemicals integrated plant. terms, to hit $2,450/tonne CFR NE
concern especially for Middle East Sadara Chemical, which is a joint venture (northeast) Asia on 26 October before
customers as prices have risen to around between USs Dow Chemical and state stabilising and moving sideways within a
$2,100/tonne CFR GCC (Gulf Cooperation energy firm Saudi Aramco, is expected to narrow range until end-November.
Council), compared with around $1,175/ cater to the Middle East and North Africa
tonne CFR GCC about a year ago. markets. A typical MDI plants output is 70-80% PMDI
and 20-30% MMDI or pure MDI, and this
Currently, the Middle East largely depends Sadaras two isocyanates plants, a 400,000 ratio moves within a narrow range and is
on imports from Asia and Europe. tonne/year PMDI and a 200,000 tonne/year not easily adjustable, according to industry
TDI unit, will be the last of its downstream sources.
But prices in Asia in particular have been derivative plants to come on stream and
outpacing Middle Eastern prices and at most market players expect them to start However, Sadaras PMDI unit will not be
times suppliers have redirected cargoes up in the third 2017 at the earliest, although producing MMDI in the early stages when it
there instead of trying to secure buyers in a company source said all its downstream comes on stream, a company source said.
the Middle East region. derivative plants will be up and running by
mid-2017. Sadaras decision to produce only PMDI
That in turn, resulted in Middle East prices and not MMDI is a deliberate one as
having to keep up with the higher Asian In the long term, once Sadara, Covestro demand for MMDI in the Middle East is
prices. and Huntsman start to run their plants minimal due to an underdeveloped MMDI
normally at high rates, the polyurethane downstream industry, market sources said.
In Europe, Covestro on 6 October (PU) market is still widely expected to be an
announced force majeure across all of its oversupplied one, and this could eventually MMDI, when combined with adipic acid,
European isocyanates operations including lead to further closures and price falls. butanediol (BDO) and methyl ethyl ketone
MDI, TDI and intermediate products due to (MEK), is used as a pre-polymer for
issues in supply of feedstock nitric acid, and In the monomeric MDI (MMDI) market, prices applications in shoe soles, adhesives,
was slated to return to full production on 11 will likely continue to track that of PMDI and thermoplastic polyurethane (TPU) resins,
December. price fluctuations are expected to be relatively spandex and synthetic leather.
more contained compared with PMDI as
However, the current status of their MMDI has a shorter shelf life of three to six
operations were not immediately clear. months compared with PMDIs two years.
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analysis for the Asian chloralkali/phenolics market, related breaking news and analysis across the global petrochemical supply chain, enabling you to grasp
including price histories and expert commentary to petrochemical markets. Our market-moving news the local or regional scenario in a global context. Data
help you understand the key price drivers and market articles cover production updates, plant capacities, includes import and export volumes, consumption,
conditions and settle your contract prices confidently with output and shutdowns, plus so much more. plant capacities, production and product trade flows
access to time-sensitive offers, bids and price movements. for chloralkali/phenolics from 1978 up to 2030.
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ICIS offers regional price assessments and market Be the first to find out about polycarbonate-related Receive an end-to-end perspective across the global
analysis for the Asian polycarbonate market, including breaking news and analysis across the global petrochemical supply chain, enabling you to grasp
price histories and expert commentary to help you petrochemical markets. Our market-moving news the local or regional scenario in a global context. Data
understand the key price drivers and market conditions articles cover production updates, plant capacities, includes import and export volumes, consumption,
and settle your contract prices confidently with access output and shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for polycarbonate from 1978 up to 2030.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
PLASTICS/POLYMERS
POLYETHYLENE (PE)
SUBDUED DEMAND TO WEIGH ON However, most suppliers had moved the mouth basis and/or opt to reduce
SOUTHEAST ASIA PE MARKET bulk of their December and part of their their regular import volumes, market
By Felita Widjaja January shipment cargoes to China for sources said.
better netback in late November.
SINGAPORE (ICIS)--Spot import prices In Indonesia, a converter said: Local
of polyethylene (PE) grades in southeast Thus, supply for LDPE film in southeast markets end-product demand in 2016
Asia are expected to be under downward Asian region might be relatively tight which had been dull for most of the year, even
pressure should demand remained might support prices in early 2017. during Hari Raya Eid-ul-Fitr season which is
subdued in the first quarter of 2017, industry supposed to be the peak period.
sources said. Overall demand and trade activity in
December 2016 have remained subdued Eid-ul-Fitr, which was in July this year, is
A relatively weak demand throughout 2016 despite a jump in crude prices after OPECs a holiday marking the end of the Muslim
weighed down on PE prices, which peaked decision to cut output next year. fasting month of Ramadan. It is observed in
at $1,255/tonne CFR (cost and freight) most parts of southeast Asia.
SE (southeast) Asia, lower by $175/tonne Crude prices rallied in the week of 2
from the highest level recorded in 2015, December after OPEC members reached In Malaysia, market concerns included the
according to ICIS data. an agreement to cut production to 32.5m depreciation of the countrys currency and
bbl/day from 1 January 2017. political instability.
In the Chinese market, on the other hand,
prices had firmed from early October to Most players in the southeast Asian PE Weak [Malaysian] ringgit against the
late November. The average price of low market reckoned that although general US dollar has made import cargoes less
density polyethylene (LDPE) film hit a 2016 sentiment might improve a little, this might attractive, prompting some buyers to refrain
high of $1,360/tonne CFR China on strong not translate into real demand for PE resins. from importing any cargo as local prices are
demand from the agricultural sector, ICIS more competitive, said a Malaysian trader.
data showed. They are opting to monitor the key China
market, other macroeconomic factors, The countrys implementation of pro-ringgit
But demand is expected to slow down including exchange rates, and political stability. policy in early December, in which exporters
closer to the Lunar New Year holidays in need to convert 75% of their proceeds into
late January, when most players in China Downstream converters are expected to the local currency, might hamper trading
would exit the market. continue procuring cargoes on a hand-to- activity in the PE market further.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
Most local converters in southeast Asia India demonetized the 500 and 1,000 rupee producer was actively offering PE cargoes,
are not keen to stock up on their inventory notes effective 9 November in a surprise move which were not usually available for export,
and may opt to rely more on prompt local to crack down on black money, or unaccounted to southeast Asia and China.
material for their immediate requirements income. Those rupee notes had more than
for most of the first quarter 2017. 80% share of the currency in circulation in the A major price upswing in the southeast
country when the ban took effect. Asia PE market can only happen if there
On the supply side, scheduled plant are major supply constraints or a strong
shutdowns in Malaysia and Thailand might Some buyers and traders in southeast Asia rebound in market demand for end-
reduce supply availability of non-dutiable PE had expressed concerns that India-origin products, industry sources said.
cargoes in the first three months of next year. import cargoes might be available as early
as December 2016 in the aftermath of the Some market participants are hopeful that
But a domestic cash crunch in India may lead demonetization, the trader said. prices might rebound in February, after the
to increased PE exports to the southeast Lunar New Year holiday, when converters
Asian market, a regional trader said. In late November, a prominent Indian re-enter the markets to restock.
You can rely on ICIS for all your polyethylene market intelligence needs
ICIS offers regional price assessments and market analysis for the Asian Anticipate where the domestic Chinese polyethylene market is heading and
polyethylene market, including price histories and expert commentary to help you create robust plans for production and investment activities. The study also
understand the key price drivers and market conditions and settle your contract includes supply and demand forecast data, import/export levels, capacity
prices confidently with access to time-sensitive offers, bids and price movements. expansion plans, downstream demand overview and outlook, as well as analyses
on key issues and developments in the market.
Request your free sample report Enquire about the ICIS China Polyethylene Annual Study
ICIS publishes monthly forecast reports for Be the first to find out about polyethylene-related Receive an end-to-end perspective across the global
selected commodities showing a 12-month rolling breaking news and analysis across the global petrochemical supply chain, enabling you to grasp
price forecast as well as details of supply and petrochemical markets. Our market-moving news the local or regional scenario in a global context. Data
demand, trade balances, capacity and margins. It is articles cover production updates, plant capacities, includes import and export volumes, consumption,
a valuable tool to identify commercial opportunities output and shutdowns, plus so much more. plant capacities, production and product trade flows
in the short to mid-term. for polyethylene from 1978 up to 2030.
Enquire about the forecast reports Request your free trial today Enquire about the supply/demand database
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
PLASTICS/POLYMERS
POLYPROPYLENE (PP)
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
a key concern amongst suppliers in the
country.
INDIA PE/PP OUTLOOK DAMPENED In a move that caught the industry as well as Market players, however, remain optimistic
BY CURRENCY ILLIQUIDITY citizens by surprise, the Indian government of the Indian economy to emerge stronger in
By Veena Pathare had announced the demonetization of Indian the next six months.
rupees (Rs) 500 and 1,000 notes effective
SINGAPORE (ICIS)--Indias polymer market from 9 November 2016. Strong polymer demand growth figures
is expected to see weak demand extend in the recent years coupled with a sound
into the first quarter of 2017, as purchasing Trade was significantly hit, as the currency economic situation is likely to support PE/
capacity remains curtailed by a lack of that was withdrawn previously accounted for PP demand in the year ahead, despite the
currency availability, industry sources said. 86% of the total money in circulation. current situation, market sources said.
Polyethylene (PE) as well as polypropylene With a large chunk of polymer business Market players also expect polymer business
(PP) prices are likely to remain weighed typically undertaken on cash basis, PE to become more organized, transparent
down by weak demand for imports as well and PP demand remained weak through and streamlined in the years ahead, buoyed
as domestic product, as buyers remain November and December as purchasing by the Indian governments efforts towards
sidelined by the persistent cash crunch. capacity was curbed by a lack of cash. bringing down unaccounted black money.
According to market players, a weakness in Market players estimate the situation to The governments crackdown on black
polymer demand is likely to persist in the first remain mostly weak until March and expect money and this demonetisation drive will
quarter of 2017 which also marks the end of to business to pick up April onwards. change the way business is done. Trade
the financial year 2016-17 in India. will eventually become fair, open and
We hope things get better in the new transparent, especially for those who have
An adverse impact on the countrys gross financial year. It will definitely be challenging found it difficult to compete with players
domestic product (GDP) is also anticipated because GDP is mostly going to be hit, and involved in cash-based trade, an Indian
in the third and fourth quarters of fiscal year demand will hence take time to come back, polymers importer said.
2016-17, as manufacturing activity is likely to but we hope things improve by 1 April, an
be affected by the currency shortage. Indian importer said.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
CHINAS PE/PP IMPORT PRICES TO in the country that in turn led to weaker sales November 2016, a South Korean
WEAKEN IN Q1 of many petrochemicals. supplier said.
By Angie Li
Moreover, the resumed production from Moreover, the arrival of Uzbekistan cargoes
SINGAPORE (ICIS)--Chinas import prices Indias Reliance also resulted in an were expected to be increase after the
for polyolefin are expected to weaken in the increased supply of polypropylene (PP) Uz-Kor Gas Chemical restarted its 400,000
first quarter of 2017 as a result of increased cargoes, an Indian supplier said. tonne/year HDPE unit in mid-October 2016,
supply and weaker demand, industry a South Korean supplier said.
sources said. The Middle East and South East Asia supply
is also expected to rise in the first quarter of While import supply into China is set to rise,
The import supply was expected to increase 2017 as most suppliers from there sold their the demand may turn out to be weak in
early next year due to firm prices in China in January and February shipment cargoes to 2017, industry source said.
the fourth quarter of 2016, local distributors China because of better net backs.
said. In the polyolefin market, players were
For Iranian cargoes, the PE supply will gradually retreating from early January
The arbitrage window between China and recover in January 2017 after several Iranian 2017 ahead of the Chinese Lunar New Year
the US opened up after polyolefin prices suppliers resumed production in mid- holiday, which falls on 28 January.
in the Chinese market soared in the fourth October, 2016.
quarter of 2016. However, demand is likely to pick up after
In the Middle East, Saudi Polymers restarted the Lantern Festival on 11 February 2017, a
For low density polyethylene (LDPE), the up its 1.1m tonne/year high density PE market source said.
average price hit a 2016 high of $1,360/ (HDPE) unit and 400,000tonne/year PP
tonne CFR (cost & freight) China in the unit in end November after a two-month Some downstream factories in north China
fourth quarter on tight supply and increased maintenance turnaround, a source close to have been forced to shut down in end
domestic prices. the company said. December 2016 due to the heavy haze, a
local distributor based in north China said.
And for PP yarn, the average price also hit a Oman Petrochemical restarted its 340,000
2016 high of $1,055/tonne CFR China in the tonne/year PP unit in early December after a Moreover, the downstream industries related
fourth quarter due to firm domestic prices, month because of unexpected maintenance, to the real estate sector were also not
ICIS data showed. a source close to the company said. optimistic.
Meanwhile, the supply from India had also For Asian cargoes, SCG restarted its The government adopted some policies
been growing due to weaker Indian rupee 400,000 tonne/year PP unit in early recently to help stabilise housing prices
and new capacity from Gail, an international December after one-month turnaround, a in the country, which will result in a
trader said. Thailand supplier said. decreased demand for polyolefins, an
industry source said.
India demonetised high-denomination rupee Samsung Total also resumed it production
notes on 9 November, creating a cash crisis on its 400,000tonne/year PP3 unit in late
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
You can rely on ICIS for all your polypropylene market intelligence needs
ICIS offers regional price assessments and market analysis for the Asian Anticipate where the domestic Chinese polypropylene market is heading and
polypropylene market, including price histories and expert commentary to help create robust plans for production and investment activities. The study also
you understand the key price drivers and market conditions and settle your includes supply and demand forecast data, import/export levels, capacity
contract prices confidently with access to time-sensitive offers, bids and price expansion plans, downstream demand overview and outlook, as well as analyses
movements. on key issues and developments in the market.
Request your free sample report Enquire about the ICIS China Polypropylene Annual Study
ICIS publishes monthly forecast reports for Be the first to find out about polypropylene-related Receive an end-to-end perspective across the global
selected commodities showing a 12-month rolling breaking news and analysis across the global petrochemical supply chain, enabling you to grasp
price forecast as well as details of supply and petrochemical markets. Our market-moving news the local or regional scenario in a global context. Data
demand, trade balances, capacity and margins. It is articles cover production updates, plant capacities, includes import and export volumes, consumption,
a valuable tool to identify commercial opportunities output and shutdowns, plus so much more. plant capacities, production and product trade flows
in the short to mid-term. for polypropylene from 1978 up to 2030.
Enquire about the forecast reports Request your free trial today Enquire about the supply/demand database
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
PLASTICS/POLYMERS
POLYVINYL CHLORIDE (PVC)
In addition, the second quarter could see based and carbide-based PVC to being a Prices of vinyl chloride monomer (VCM),
continual support from the India market, as net importer. the immediate derivate of PVC, closely
they would have long since recovered from followed PVC price trends in 2016 and this
the currency ban that plagued the market The Chinese government began a series of is expected to remain unchanged for 2017.
in November 2016, and improved end-use environmental inspections prior to the start
demand usually seen before the start of the of the G20 conference held in Hangzhou, However, some market participants expect
monsoon season. China in early September 2016, which led the narrowing spread between PVC and
to a number of Chinese vinyl facilities to VCM prices in northeast Asia seen in the
Indias government demonetised high- lower their operating rates, or to shut down. second half of 2016 to continue in 2017.
denomination rupee notes on 9 November
resulting in a cash crisis in the country. However, after the end of the G20 In northeast Asia, VCM sellers were able
conference, the Chinese government did to steadily shrink the spread between VCM
Overall PVC demand in Asia was not not stop carrying out the environmental and PVC spot prices in the key buying
expected to be much different in 2017 from inspections, resulting in persistently low market of China, due to the surge in
the current year, sources said. domestic PVC production resulting in tight domestic Chinese PVC prices.
supply and soaring prices.
Northeast (NE) and southeast (SE) Asia In southeast Asia, a major VCM producer
would likely see the same single-digit growth The immediate effect was that Chinese completed an expansion to its VCM facility
in end-use demand as it is currently but PVC producers, both carbide-based and in early 2016 and targeted another smaller
India could possibly see double-digit growth. ethylene-based, were less inclined to export expansion to come online by the end pf
PVC, with domestic prices higher than spot 2017.
On the other hand, market players expected prices.
a huge shift in trade dynamics due to the There was no spot VCM volume southeast
supply side. At the same time, Chinese buyers were Asia origin heard available in 2016 and it
keener than ever to import PVC. was expected to remain this way in 2017.
Traditionally, northeast Asia is the largest
exporter of PVC in the Asia Pacific region, In light of declining of Chinese PVC Compared to PVC prices, spot ethylene
with India, southeast and Australia being exports, especially carbide-based PVC, and dichloride (EDC) prices were less volatile in
the largest recipients of these cargoes. improved Chinese buying interest, other 2016 and only saw a very gradual firming in
Asian PVC producers were able to achieve prices when downstream PVC prices were
However, in the second half of 2016, China consecutive months of firmer spot prices surging.
went from being a net exporter of ethylene- from July to December 2016.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
From July to end December, PVC prices
firmed from $760/tonne CFR (cost & freight)
China to $970/tonne CFR China, while EDC
prices only firmed from $255/tonne CFR NE
Asia to $295/tonne CFR NE Asia.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
CASH CRISIS TO DAMPEN INDIA cash. People cannot buy even if they want domestic supply is just not enough to meet
PVC OFF TAKE IN EARLY-2017 to, an Indian PVC end-user said. Indias demand [for PVC], a domestic Indian
By Jeslyn Lerh producer said.
The PVC market is largely operated in cash
SINGAPORE (ICIS)--The near-term offtake and most market participants expected According to ICIS data, total PVC demand
for polyvinyl chloride (PVC) in India may business to recover only after there is enough in India is expected to exceed 3m tonnes
still be limited by the demonetization policy circulation of new currency in the market. in 2017. In the financial year 2015-2016,
introduced late last year, despite earlier Indias PVC imports amounted to about 1.6m
expectations of robust demand in the first Producers also expressed concerns about tonnes, accounting for more than half of the
half of this year, industry sources said. their sales to India in the near term. total PVC demand in the country.
Agricultural demand [for PVC pipes] is The situation seems serious. People have
always there. Our new government is very no money to buy and farmers are the most You can rely on ICIS for all
focused on infrastructural development. We affected, a northeast Asian producer said. your polyvinyl chloride (PVC)
were expecting a lot of demand for pipes,
especially from end-February to April, an At least 70% of PVC demand in India comes market intelligence needs
India-based trader said. from the agricultural sector, where pipes are
used for the irrigation of crops. PRICING INFORMATION
The fourth quarter of the Indian financial year
ICIS offers regional price assessments and
is traditionally a peak demand period for Most customers already have inventories market analysis for the Asian PVC market,
PVC, due to restocking activities ahead of from the past months. Buying is likely to pick including price histories and expert commentary
the pipe-laying season. Indias financial year up only after the currency situation is more to help you understand the key price drivers and
market conditions and settle your contract prices
begins in April and ends in March. stable which is going to take a long time, confidently with access to time-sensitive offers,
said a trader who deals in deep-sea cargoes. bids and price movements.
Many processors said that demand had
started to pick up in November. People However, other market participants were Request your free sample report
were expecting a good round of PVC more optimistic of the situation.
for the next six months till May, another NEWS INFORMATION
trader said. This is until a sudden bomb Some customers continue to operate
Be the first to find out about PVC-related breaking
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season of PVC [offtake]. ones who transact with cash, said another markets. Our market-moving news articles cover
northeast Asian producer, who did not think production updates, plant capacities, output and
shutdowns, plus so much more.
In November Indian Prime Minister Narendra that offer prices will be lowered in the near
Modi announced a ban of Rs500 and term to boost buying.
Request your free trial today
Rs1000 rupee notes in an attempt to curb
corruption and tax evasion in the country. Since July last year, Indian PVC spot
prices have been on an uptrend due to ICIS CHINA POLYVINYL CHLORIDE (PVC)
The move caught many by surprise and limited export availability from China. This has ANNUAL STUDY
resulted in a cash crisis, with people flocking to caused Asian exporters to hike offers to India. Anticipate where the domestic Chinese PVC
banks to cash in their old notes. More than 85% market is heading and create robust plans for
production and investment activities. The study
of transactions occur on a cash basis in India. The cash crisis has impacted both local and also includes supply and demand forecast data,
import markets. But, it is possible that people import/export levels, capacity expansion plans,
The problem lies with the cash, there is no will still buy in one way or another because downstream demand overview and outlook, as well
as analyses on key issues and developments in
the market.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
PLASTICS/POLYMERS
PLASTICIZERS
You can rely on ICIS for all your plasticizers market intelligence needs
ICIS offers regional price assessments and market Be the first to find out about plasticizers-related Receive an end-to-end perspective across the global
analysis for the Asian plasticizers market, including price breaking news and analysis across the global petrochemical supply chain, enabling you to grasp
histories and expert commentary to help you understand petrochemical markets. Our market-moving news the local or regional scenario in a global context. Data
the key price drivers and market conditions and settle articles cover production updates, plant capacities, includes import and export volumes, consumption,
your contract prices confidently with access to time- output and shutdowns, plus so much more. plant capacities, production and product trade flows
sensitive offers, bids and price movements. for plasticizers from 1978 up to 2030.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
PLASTICS/POLYMERS
METALLOCENE LINEAR LOW DENSITY POLYETHYLENE (MLLDPE)
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
Most buyers in India opt to utilise their However, it had not led to real demand for competitive, particularly in southeast Asia
existing inventory till a clearer market polyethylene (PE) and metallocene linear and India markets at the moment.
direction emerged and opt to restart price low density PE (MLLDPE) cargoes.
discussion for January shipment cargoes On the other hand, a sudden increase in
instead towards the end of December. Local PE suppliers in India extended their import offers might also be able to kick-start
discount schemes which exert pressure on demand as buyers are sitting on relatively
Some local manufacturers in India were commodity PE prices as well as MLLDPE low inventory in towards the end of the year
running their factories at as low as 40% prices in domestic market. with some converters sitting on at most one
capacity, purchasing limited cargoes on week of inventory level in a bid to minimise
need-to basis. Most Indian market players expect import risks.
market to rebound sometime in January
This led some distributors to cut their cargo to February 2017 period when cash flow Prices of commodity polyethylene (PE)
procurement by as much as 50% for the would have improved amid availability grades in 2017 is expected to continue
month of December, according to market of new currency denominations and the to play a crucial role in setting the price
sources. market also needs time to pick up its pace. direction of MLLDPE in Asia moving
forward.
Market sentiment slightly improved in early A distributor said that import MLLDPE
December as crude oil prices increased prices in the first quarter of 2017 need
after OPECs decision to cut output in to be lower in order for buying interest to
January. return as import prices were deemed as not
You can rely on ICIS for all your MLLDPE market intelligence needs
ICIS offers regional price assessments and market Be the first to find out about MLLDPE-related Receive an end-to-end perspective across the global
analysis for the Asian MLLDPE market, including breaking news and analysis across the global petrochemical supply chain, enabling you to grasp
price histories and expert commentary to help you petrochemical markets. Our market-moving news the local or regional scenario in a global context. Data
understand the key price drivers and market conditions articles cover production updates, plant capacities, includes import and export volumes, consumption,
and settle your contract prices confidently with access output and shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for MLLDPE from 1978 up to 2030.
Request your free sample report Request your free trial today Enquire about the ICIS China Base Oils Report
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
Trusted industry
intelligence for Chinas
commodity markets
Developments in Chinas petrochemical industry
continue to affect the global marketplace. It is
therefore vital for domestic and international
market players to keep track of changes within
the country, to know where opportunities lie.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
Middle East and Africa, the main concern Rigid polyols combined with polymeric More PO volume being converted into
now is whether these suppliers will be able methyl di-p-phenylene isocyanate (PMDI) is polyols in-house in integrated facilities will
to ward off the Sadara assault in their home used in refrigerators as well as insulation in thereby dampen the demand for PO and
turf in Asia. the construction sector. may indirectly put downward pressure on
PO prices, the sources said.
Many of these suppliers are apprehensive For polyols production, Sadara will focus
about a reversal of trade flows in which on flexible slabstocks and polymer polyols Meanwhile, China PO import volume which
Sadaras methyl di-p-phenylene isocyanate when its polyols plant comes on stream has been dwindling over the past couple of
(MDI), TDI, polyols and propylene glycol while Dows plant in Thailand will produce years will likely remain largely stable in 2017,
(PG) cargoes would infiltrate into most less of flexible slabstocks and shift to with regular shipment to come from the usual
Asian regions, although its PO is believed produce more coatings, adhesives, sealants two sources, namely Saudi Arabias Rabigh
to be entirely for captive use and will not be and elastomers (CASE) polyols, market Refining and Petrochemical Co (Petro Rabigh)
for commercial sales. sources said. and USs LyondellBasell Chemical Co.
You can rely on ICIS for all your propylene oxide market intelligence needs
ICIS offers regional price assessments and market Be the first to find out about propylene oxide- Receive an end-to-end perspective across the global
analysis for the Asian propylene oxide market, including related breaking news and analysis across the petrochemical supply chain, enabling you to grasp
price histories and expert commentary to help you global petrochemical markets. Our market-moving the local or regional scenario in a global context. Data
understand the key price drivers and market conditions news articles cover production updates, plant includes import and export volumes, consumption,
and settle your contract prices confidently with access capacities, output and shutdowns, plus so plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. much more. for propylene oxide from 1978 up to 2030.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
POLYURETHANE
TOLUENE DI-ISOCYANATE (TDI)
ASIA AND MIDDLE EAST TDI but this could not be confirmed with the BASF and Sadara start running their plants
PRICES TO EXTEND LOSSES company. normally at high rates.
By Matthew Chong & Izham Ahmad
There were concerns that some of the TDI spot import prices in Asia surged to
SINGAPORE (ICIS)--Toluene di-isocyanate material from the new plant will find its way over eight-year highs in October amid the
(TDI) prices in Asia and the Middle East into Asia besides the Middle East, and exorbitant rise in China domestic prices due
are expected to edge lower in the first the start-up delay will bring some relief to to a myriad of factors.
few months of 2017 but may start to drop northeast Asian suppliers, albeit temporarily.
faster thereafter as tight supply conditions Overall supply was relatively tight due to
in Europe are expected to be alleviated by Middle East players have also been eager turnarounds at several northeast Asian
the second quarter, according to market for news about additional supply coming plants in October and November.
sources. from Sadara Chemicals integrated plant.
Average TDI import prices jumped by
Feedstock toluene prices may also play a Sadara Chemical, which is a joint venture a cumulative 89%, or $2,100/tonne in
greater role in determining the TDI price between USs Dow Chemical and state absolute terms, to hit $4,450/tonne China/
trend in 2017 as raw material prices which energy firm Saudi Aramco, is expected to Hong Kong on 19 October in the short span
have risen in line with crude oil prices since cater to the Middle East and North Africa of three weeks.
November will start to erode TDI producers markets.
margins, sources said. Average China domestic prices nearly
Sadaras two isocyanates plants, a 200,000 tripled to a historical high of Chinese yuan
The supply shortage has stemmed from a tonne/year TDI and a 400,000 tonne/year (CNY) 49,500/tonne DEL (delivered) south
series of plant troubles, which began when PMDI unit, will be the last of its downstream China on 19 October over a four-week
Covestro in early October announced force derivative plants to come on stream and period. Prices have since corrected from its
majeure (FM) across all of its European most market players expect them to start peak and were hovering at slightly below
isocyanates operations including TDI, up in Q3 2017 at the earliest, although a CNY30,000/tonne DEL south China from
methyl di-p-phenylene isocyanate (MDI) company source said all its downstream mid-November to December.
and intermediate products due to issues in derivative plants will be up and running by
supply of feedstock nitric acid. mid-2017. The excessive rise in China domestic prices
could be partly attributed to panic buying
These operations were slated to return to From Q2 2017 onwards, the TDI market is as buyers were holding on to low TDI stock
full production on 11 December but there expected to return to the oversupplied state inventory due to suppressed TDI prices
have been no official updates on their it had been in early-2016 once Covestro, over the past couple of years and they
current status.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
started to snap up cargoes when prices Middle East TDI prices peaked at $4,100/ November when prices started retreating
began to increase amid tighter supply. tonne CFR GCC (Gulf Cooperation Council) from their peak.
in October but the prices began to ease in
In October 2016, TDI import prices in Asia early November amid an ample availability Chinese foam makers, the downstream
and the Middle East took cues from China of cargoes from northeast Asia. Buyers also of TDI, have cut their production following
domestic prices and skyrocketed by over pushed for lower prices as more material the exorbitant surge in TDI domestic
$1,000/tonne in the short span of three became available. prices in October, thereby suppressing the
weeks as supply shortage sparked weeks consumption of both TDI and polyols.
of panic buying from customers. There were fears that prices would fall back
as quickly as they had risen but so far these TDI, when combined with flexible polyols,
Since November, prices have been on a fears appear unfounded. By late-November, find outlets in polyurethane (PU) foam for
downtrend but the pace of decline has been TDI prices were only down by about $500/ mattresses, furniture and automotive seats.
relatively moderate, and TDI prices have yet tonne CFR GCC from their October highs.
to retrace October moves. This correction
process is expected to extend into the first On the demand side, buyers have been
few months of 2017. adopting a wait-and-see stance since
You can rely on ICIS for all your TDI market intelligence needs
ICIS offers regional price assessments and market Be the first to find out about TDI-related breaking Receive an end-to-end perspective across the global
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histories and expert commentary to help you markets. Our market-moving news articles cover the local or regional scenario in a global context. Data
understand the key price drivers and market conditions production updates, plant capacities, output and includes import and export volumes, consumption,
and settle your contract prices confidently with access shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for TDI from 1978 up to 2030.
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RUBBER
STYRENE BUTADIENE RUBBER (SBR)
You can rely on ICIS for all your styrene butadiene rubber (SBR) market intelligence needs
PRICING INFORMATION ICIS STYRENE BUTADIENE RUBBER (SBR) STUDY SUPPLY AND DEMAND DATABASE
ICIS offers regional price assessments and market Anticipate where the domestic Chinese SBR market Receive an end-to-end perspective across the global
analysis for the Asian SBR markets, including is heading and create robust plans for production and petrochemical supply chain, enabling you to grasp
price histories and expert commentary to help you investment activities. The study also includes supply the local or regional scenario in a global context. Data
understand the key price drivers and market conditions and demand forecast data, import/export levels, includes import and export volumes, consumption,
and settle your contract prices confidently with access capacity expansion plans, downstream demand plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. overview and outlook, as well as analyses on key for SBR from 1978 up to 2030.
issues and developments in the market.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
SOLVENTS
ACETONE
CAPACITY EXPANSION TO market slump and the strain on producers (zero ADD basis, subject to import duty) on
EXACERBATE ASIA ACETONE margin prompted China-based phenol/ 2 December 2016, 89% above the trough
GLUT acetone makers to cap their overall in January.
By Trisha Huang utilisation rates at 50-60% capacity by
the fourth quarter of 2015, according to A previous force majeure (FM) declared by
MELBOURNE (ICIS)--The existing acetone estimates by market participants. Shell on base chemical supplies from its
supply overhang in Asia is expected to Pulau Bukom cracker complex had crimped
worsen in 2017 as the regions capacity In January 2016, spot acetone prices into Mitsui Phenols Singapores phenol/acetone
expansion outpaces the growth in demand. China, Asias biggest market, sank to a 14- output between December 2015 and end-
year low average of $385/tonne CFR (cost April 2016.
Asia, which already has about half the & freight) China on a zero antidumping duty
worlds phenol/acetone capacity, will see (ADD) basis, subject to import duty. Shells cracker outage also constrained
further capacity increase in 2017. China-based Changshu Changchun
The prices were last lower in March 2002, Chemicals Singapore cumene output
The anticipated commissioning of two new according to data compiled by ICIS. and its Changshu phenol/acetone plant
phenol/acetone plants is set to boost the operations.
regions acetone capacity by a further 6.5% The yuan-denominated domestic acetone
to 4.12 million tonnes by end 2017. prices in east China, a key market gauge, The commissioning of Thai producer PTT
plunged to an all-time low close of yuan Phenols new unit, PTT Phenol II, had
Following a pause in capacity addition in (CNY) 3,280/tonne ex-tank on 30 October been postponed from late 2015 to May
2016, phenol/acetone capacity in China is 2015, ICIS data showed. 2016. PTT Phenols plant operations were
set to increase in the second half of 2017 subsequently disrupted in August by an
as CNOOC and Shell Petrochemicals Co However, 2016 witnessed a heavy phenol/ explosion and fire at a waste water tank.
(CSPC) starts up a new plant. acetone plant turnaround schedule and a
string of accidents which, alongside the year- And in China, an outage at Changshu
The construction of Deepak Phenolics on-year drop in deep-sea imports and a pick- Changchuns waste water treatment facility
new phenol/acetone plant, Indias largest, up in Americas demand for Asian material in also prevented the producer from operating
is expected to be completed in the final the second half of the year, set the stage for its phenol/acetone plant between late July
quarter of 2017. acetone to make a spectacular comeback. and end-August.
Further afield, Petro Rabighs new phenol/ The CFR China acetone market closed at a A second force majeure declared by Shell on
acetone plant in Rabigh, Saudi Arabia is 20-month high of $727.50/tonne CFR China 29 September again curtailed Mitsui Phenols
expected to add a further 150,000 tonnes/
year of acetone to an already saturated
market in the second half of 2017.
The three new plants will add to the length
in supply even as Asian producers are
already grappling with excess capacity and
weak margins especially for primary product
phenol.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
Singapore and Changshu Changchun Demand growth for acetone is expected to tonne/year MMA plant while Dongming
Chemicals phenol/acetone output. again lag the gain in supply in 2017. Huayi New Materials is scheduled to
commission a new 50,000 tonne/year MMA
The evident strength in acetones In the downstream bisphenol A (BPA) plant, according to data compiled by the
supply/demand fundamentals and the sector, only Covestro is expected to bring China editorial team at ICIS.
comparatively soft conditions in the onstream a new 110,000 tonne/year line in
primary product phenol sector also led to China in the first quarter of 2017. Mitsubishi Rayon Co, parent company of
an accelerated narrowing in the spread MMA major Lucite International, plans to
between CFR China acetone and CFR Despite expanding acetone supply, none of start up a 250,000 tonne/year MMA plant in
China phenol prices in November 2016. the new methyl methacrylate (MMA) plants mid-2017 in partnership with Saudi Arabias
scheduled for commissioning in 2017 are SABIC. The plant will use the companys
However, by their nature, unplanned outages designed to use acetone as a feedstock. highly productive Alpha process.
are unpredictable and without unanticipated
cuts to supply, acetone is likely to return to a In China, the two new plants starting up Petro Rabigh, the joint venture between
state of oversupply next year. in 2017 will produce MMA using the C4 Japans Sumitomo Chemical and state-
process, through the direct oxidation of iso- owned energy firm Saudi Aramco, will also
The second half of 2017 is likely to see a butylene. commission a new 90,000 tonne/year MMA
return to 2015 and [phenol/acetone] producers plant in 2017 using the C4 manufacturing
margins will depend on their willingness to rein In the third quarter of 2017, Shandong Yidali process.
in output, an Asian trader said. plans to bring onstream a new 100,000
Deepak Phenolics Dahej, Gujarat State, India 200 120 Construction to be completed by Q4 2017
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analysis for the Asian acetone market, including breaking news and analysis across the global petrochemical supply chain, enabling you to grasp
price histories and expert commentary to help you petrochemical markets. Our market-moving news the local or regional scenario in a global context. Data
understand the key price drivers and market conditions articles cover production updates, plant capacities, includes import and export volumes, consumption,
and settle your contract prices confidently with access output and shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for acetone from 1978 up to 2030.
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SOLVENTS
PHENOL
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
In addition, the first half of 2017 will likely The typical production ratio means that The surge in benzene prices in the fourth
see the commissioning of Chinas first Fujian Shenyuan may consume up to quarter of 2016, which has pummelled
phenol-based cyclohexanone (anone) plant 200,000 tonnes/year of phenol at full phenol makers margins, may also be a
by caprolactam (capro) and nylon producer operations. blessing in disguise, according to one
Fujian Shenyuan New Materials. school of thought.
You can rely on ICIS for all your phenol market intelligence needs
ICIS offers regional price assessments and market Be the first to find out about phenol-related Receive an end-to-end perspective across the global
analysis for the Asian phenol market, including breaking news and analysis across the global petrochemical supply chain, enabling you to grasp
price histories and expert commentary to help you petrochemical markets. Our market-moving news the local or regional scenario in a global context. Data
understand the key price drivers and market conditions articles cover production updates, plant capacities, includes import and export volumes, consumption,
and settle your contract prices confidently with access output and shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for phenol from 1978 up to 2030.
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SOLVENTS
EPOXY RESINS
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
ASIA SOLVENTS SEEN STABLE TO to major Asian markets, China and India markets in the Asian region could boost the
FIRM ON HIGHER OIL PRICES though it was committed to cut production demand, but most said that the increased
By Angeline Soh by 210,000 bbl/day. demand may not be able to offset the falling
demand in other countries.
SINGAPORE (ICIS)--Asia isopropanol, POOR DEMAND
methyl ethyl ketone (MEK) and methyl If the solvents lose their bolster from the SUPPLY GLUT
isobutyl ketone (MIBK) prices are expected upstream markets, prices may tumble, In addition, the persistent supply glut has
to be stable-to-firm in 2017 on the back of due to their dwindling demand from poor been consistently weighed on the prices.
higher feedstock crude oil prices, according downstream performance since crude New plant start-up may further weigh on
to industry players. prices crashed in 2014. prices. However, while some plants are
slated to come on stream, the exact dates
An agreement between the Organization of Some players are hopeful that the emerging are not confirmed.
the Petroleum Exporting Countries (OPEC)
and several non-members to cut production
by 1.2m bbl/day kicked in on 1 January, The downstream end-user markets for individual solvents:
which caused a sharp rally in crude oil prices.
Product Country Demand pre-crude crash (mt/year) Demand post-crude crash (mt/year)
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
Product Company Capacity (mt/year) Location Start-up
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analysis for the Asian solvents market, including breaking news and analysis across the global petrochemical supply chain, enabling you to grasp
price histories and expert commentary to help you petrochemical markets. Our market-moving news the local or regional scenario in a global context. Data
understand the key price drivers and market conditions articles cover production updates, plant capacities, includes import and export volumes, consumption,
and settle your contract prices confidently with access output and shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for solvents from 1978 up to 2030.
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ICIS price forecast reports
Supply, demand and price trends at a glance
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Packed with vital information, the report includes everything you need to assess where the market is heading
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ASIA AE Q1 TO BE SUPPORTED BY
FIRM UPSTREAM MARKETS
By Jeslyn Lerh
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alcohols/fatty acid market, including price histories and expert commentary analysis across the global petrochemical markets. Our market-moving news
to help you understand the key price drivers and market conditions and settle articles cover production updates, plant capacities, output and shutdowns, plus
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UPSTREAM FEEDSTOCKS
NAPHTHA
ASIA NAPHTHA MARKET TO SEE be the highest level in at least six months, More producers are switching to cheaper
LIMITED BULLISH FACTORS according to traders. LPG cracker feedstock over naphtha, the
By Melanie Wee source said.
Deep-sea supply flows at around 1.2m
SINGAPORE (ICIS)--Asias naphtha tonnes are already expected to land in Asia LPG presents better economics for regional
markets are likely to see limited bullish in December, up from around 600,000- petrochemical producers, while the naphtha
factors at least in the early half of 2017 700,000 tonnes estimated in November, market is awash with supply. The gas
on account of increased transatlantic deep- traders said. feedstock was estimated to be cheaper by
sea supply and a greater use of competing about $30-40/tonne compared with naphtha
liquefied petroleum gas (LPG) feedstock, The recent rally in crude oil futures following for now, traders said.
market sources said. a deal among global producers to trim
output has generated downward pressure Meanwhile, expansion is on the cards for
Weak market fundamentals might persist on naphtha crack spreads, even as Asia Asia-Pacific crackers and refineries.
through next year against a backdrop of a naphtha physical prices were driven up by
recent crude oil rally and growing availability gains in crude oil futures. In South Korea, Lotte Chemical plans to
of naphtha cargoes in the region. expand the ethylene capacity of its Yeosu
As of 9 December, Asias naphtha crack cracker to around 1.2m tonnes/year by
Q1 [the first quarter] could be supported spread versus February ICE Brent crude 2018 from the current 1m tonnes/year,
[by] seasonal demand but its was assessed at $55.83/tonne, levels not according to sources with knowledge of the
suppressed by more arbs [arbitrage seen in seven weeks. matter.
cargoes] coming in December and
January, a southeast Asia-based market The spread was down from $58.60/tonne In India, Bharat Petroleum Corp Ltd (BPCL)
source said. on 8 December and $61.00/tonne on 2 has ongoing expansion at its 190,000 bbl/
December, according to ICIS data. day Kochi refinery. The refinerys capacity
But moving forward in the year [2017] will will be raised to 310,000 bbl/day by March
be a bit more bearish with some crackers The [flipped] contango market is caused 2017, according to a source familiar with
moving to run more LPG 88-Ron by arbitrage [flows], combined with a the matter.
[gasoline] Indonesian demand [could] narrower naphtha and liquefied petroleum
drop, so naphtha blending demand will be gas (LPG) spread, a regional market Meanwhile, naphtha consumption from key
lessened, the source said. source said. importer China has slowed. In October, the
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
countrys naphtha imports stood at 338,769 The spread between naphtha and benzene such as LPG and ethane, with new ethane
tonnes, down 27% year on year and 24% consequently spiked to above $390/tonne crackers coming online in the US and
lower month on month, according to China as of 9 December from around $172/tonne elsewhere, said Trafigura head of oil and
Customs data. at this time last year, ICIS data showed. petroleum products trading Jose Larocca in
the report.
But the market took heart from overall In the coming months, naphtha is expected
positive economic data in China, helping to to feel the pressure from having to compete Key to success will be finding ways of
cushion the negative sentiment. with other available feedstocks like LPG. maximising other uses of naphtha into
gasoline blending, splitting, or as a diluent
Chinas official manufacturing purchasing Most crackers in Asia use naphtha as for crude oil, Larocca said.
managers index (PMI) rose to a two-year feedstock for production, but can substitute On 2 December, naphtha-based ethylene
high of 51.7 in November, up from 51.2 in a portion of the feed with LPG. margins in northeast Asia stood at $665/
October. tonne, down by some 0.3% from the
Commodities trader Trafigura expects 2017 previous week. LPG-based margins in the
The PMI is a barometer of an economys to see a heavy surplus of oil products, region rose by about 5.1% to $613/tonne
manufacturing activities, with a reading of particularly diesel and naphtha, it said in its in the same comparison, according to ICIS
50 or higher indicating an expansion, while 2016 annual report. weekly margin report.
a number below that denotes a contraction.
Looking forward, we expect naphtha
In downstream benzene markets, robust to continue to lose ground in the
China demand has pushed up spot prices. petrochemical complex to other feedstocks
You can rely on ICIS for all your naphtha market intelligence needs
ICIS offers regional price assessments and market Be the first to find out about naphtha-related Receive an end-to-end perspective across the global
analysis for the Asian naphtha market, including breaking news and analysis across the global petrochemical supply chain, enabling you to grasp
price histories and expert commentary to help you petrochemical markets. Our market-moving news the local or regional scenario in a global context. Data
understand the key price drivers and market conditions articles cover production updates, plant capacities, includes import and export volumes, consumption,
and settle your contract prices confidently with access output and shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for naphtha from 1978 up to 2030.
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UPSTREAM FEEDSTOCKS
METHYL TERTIARY BUTYL ETHER (MTBE)
ASIA MTBE MAY SEE LONGER Separately, the US-Asia arbitrage spread activity is not the worst among the lot and
SUPPLY AMID CHINA WILDCARD was also opened during the same period this has proved to be the key for more
By Trixie Yap and there were cargoes of at least 15,000- producers trying to sell cargoes there, a
20,000 tonnes of MTBE heading to Western-based trader said.
SINGAPORE (ICIS)--Asias methyl tertiary Singapore, Taiwan and China. This was the
butyl ether (MTBE) market is expected to second arbitrage phenomenon not seen in Furthermore, with supply in markets such
see longer supply mainly from the Middle the past two years, market players said. as the US dependent on propylene oxide
East in 2017, with Chinese importers to (PO) margins because of swing PO/MTBE
continue being the demand wildcard, plants, there is an even higher likelihood
market participants said. The 2016 arbitrage trade flow and evidently of deep-sea cargoes adding on to the
higher FOB Singapore and CFR China lengthening supply situation in Asia.
While market players expected gasoline prices, in comparison to US gulf and FOB
demand in regions such as Europe, the Rotterdam prices, have set the stage for If PO margins stay healthy, of course
US and Asia to be a firm supporter of sellers in 2017 to shift their focus to Asias these swing producers will maximise their
MTBE prices in 2016, the market moved import market. production and have more MTBE since it
in a different way as consumers stockpiled is just a by-product, one northeast Asia-
gasoline on expectations of a rise in prices. Already, some of them mainly the Middle based producer said.
As a result, the demand in both Europe and East-based producers have indicated
the US were lower than expected. their interest to maximise and increase their
To match up with this increment in supply,
contractual volumes heading to Singapore
regional market players are hoping that
This led to deep-sea sellers offloading or northeast Asia such as Taiwan, several
Chinese import demand will be the key
MTBE cargoes into Asia instead because of market sources said. wildcard for 2017. Chinese buyers had
the opened arbitrage spread in most parts of exceeded all expectations for 2016,
the year in 2016. There is a firm interest from these importing a total of 368,885 tonnes of
producers to shift their focus from Europe or MTBE, according to customs data.
The opening of the Europe-Asia arbitrage US back to Asia, just because 2016 proved
spread was the most unexpected of that Asian importers had the strongest An open CFR China-FOB Singapore
all because usually we send cargoes buying appetite, a southeast Asia-based arbitrage spread (please see graph on
to Europe instead since there is better trader said. next page), workable distributor margins
blending demand in that region, one and better-than-expected demand in the
Singapore-based trader said. While exact estimates could not be wholesale gasoline trading market were key
confirmed, most MTBE blenders and factors in the unexpectedly large volumes
The Europe-Asia arbitrage spread was traders say they are expecting an increase arriving at south and east China shores up
opened for almost the entire first-half of of at least 30-40% in quantities coming from to November 2016.
2016 and this caused several swing these producers.
traders to redirect their Middle East-origin Therefore, market players are mostly
material into Asia instead because of the Even though MTBE demand has not been placing their bets on Chinese demand
better netbacks. fantastic for most of 2016, Asias gasoline to continue to provide support to the
increasing supply fundamentals at least up
to the Lunar New Year period.
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There are heavy expectations that teapot
refineries will redirect their focus to the
domestic selling activities because of this,
which could in turn have an impact on the
amount of gasoline blending activities by
private blenders.
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analysis for the Asian MTBE market, including news and analysis across the global petrochemical petrochemical supply chain, enabling you to grasp
price histories and expert commentary to help you markets. Our market-moving news articles cover the local or regional scenario in a global context. Data
understand the key price drivers and market conditions production updates, plant capacities, output and includes import and export volumes, consumption,
and settle your contract prices confidently with access shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for MTBE from 1978 up to 2030.
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Supply and Demand
Database
Single searchable source of historical data on
global petrochemical and energy markets
More than just data, the ICIS Supply and Demand Database is a powerful analytics tool which
gives end-to-end perspectives across the global petrochemical supply chain, including reneries.
Data is derived by ICISs team of Consultants using a bottom-up approach reconciling
demand with supply, production, local capacity and net trade. Forecasts are validated against
economic indicators such as GDP and per capita consumption.
Traditionally in the fourth quarter, demand base oils were mostly kept buoyant by the I got offers for which I would have to
wanes as buyers and traders attempt to snug spot availability, sources said. purchase in the ratio of 1:3, with 150N
keep inventories lean ahead of the closing volumes being three times that of
of accounts. For December-loading cargoes, some 500/600N. 500/600N cargoes are really
Group II refiners maintained that they have tight in supply now, the northeast Asian
Price declines can also be observed limited spot lots to sell, especially for heavy buyer added.
especially since sellers usually cut offers to grade 500/600N.
encourage cargo uptake among customers Spot supply conditions in the first quarter
to bring seller inventory levels down. Buyers echoed similar sentiments, adding of 2017 look tight because of scheduled
that they faced difficulty in obtaining turnarounds, a northeast Asia-based Group
However, the fourth quarter of 2016 defied December shipment spot cargoes from II refiner said.
traditional expectations, most market regional Group II refiners.
players said. With scheduled turnarounds coming up
I did not receive any offers for December- in the first quarter for some refineries, be
Scheduled shutdown maintenance, loading cargoes as most of the South it Group I or II base oils, supply would
persistent plant issues and contractual Korean refiners do not have spot cargoes to undoubtedly be compromised. Furthermore,
commitments resulted in a market in offer, a southeast Asia-based buyer said. during supply crunch periods, we would
which availability of Group II spot cargoes typically receive requests for more cargoes
remained tight. We are now mostly relying on our term from our term customers, so spot availability
volumes for supply. It is unlikely that would most likely be affected, the refiner
Group II heavy grade material 500/600N January supply would be any different from added.
was comparatively tighter in supply against Decembers, the buyer added.
low viscosity grade 150N, as some refiners Most market participants were of the
kept their 500/600N for captive usage in A separate northeast Asian buyer said if the opinion that spot prices for Group II cargoes
downstream lubricants production. refineries want to sell 500/600N, they would could register further gains going forward
almost surely try to bundle it with 150N so into the first quarter, especially since
As a result, spot prices throughout the as to liquidate the more amply-available Januarys spot supply is poised to remain
earlier part of the fourth quarter for Group II grade. snug as well.
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ASIA GROUP I BASE OIL SPOT about by lacklustre demand in the year end Furthermore, unlike previous years whereby
PRICES TO HOLD STABLE-TO-FIRM ahead of the closing of accounts. Lunar New Year fell in February, 2017s
IN Q1 Lunar New Year period is set to commence
By Jasmine Khoo Other factors which contributed to the earlier in late January 2017.
softening prices included stiff competition
SINGAPORE (ICIS)--Asia group I base oils from other base oils groups such as Group With Lunar New Year coming earlier in
spot prices are set to stand largely stable- II 150N and 500N, which could replace 2017, we saw an increased number of
to-firm in the first quarter of 2017 as a Group Is SN150 and SN500 for some enquiries from mostly northeast Asian
result of well-balanced demand and supply downstream applications, market sources buyers, who said that they were hoping for
conditions, market sources said. said. the cargoes to arrive in January, ahead of
the Lunar New Year festivities, a northeast
Market players mostly described the fourth Back then in 2014, new start-ups in the third Asia-based Group I refiner said.
quarter of 2016 as being significantly quarter of the year had led to increased
different from that of the past years such supply of Group II base oils, which exerted These enquiries for December or early-
as 2014 and 2015, when spot prices had downward pressure on Group I numbers, January shipment cargoes are significantly
registered steep drops. sources added. more compared with the previous years,
the refiner said.
According to ICIS data, spot prices for As for 2016, spot prices for Group I base
SN500 shed 16%, falling from an average oils saw price stability for the early fourth A regional buyer looking for the material
of $580/tonne FOB (free on board) Asia quarter as spot supply was snug among echoed similar sentiments.
to $485/tonne FOB Asia during the period some regional refiners due to shutdowns
from 2 October to 25 December in 2015. and contractual commitments, market We are seeking to replenish inventories
players said. and stock up on Group I material ahead of
ICIS data also showed that a separate the Lunar New Year festive holidays, and
Group I grade, brightstock, observed There is no need for us to actively cut are currently gearing up for negotiations for
declines when prices went down from $940/ prices to encourage cargo uptake among December-loading spot cargoes, the buyer
tonne FOB Asia to $910/tonne FOB Asia buyers this fourth quarter. Buyers are said.
amid tepid demand during the same time purchasing spot lots regularly and we are
period. also grappling with healthy demand in the With this Decembers demand conditions
domestic market, a regional base oils comparatively healthier than the past years,
Back in 2014, spot prices for Group I Group I refiner said, most market players held on to a more
base oils had also decreased in the fourth optimistic outlook for the near-term price
quarter, with brightstock experiencing As a result, discussions for most movement, adding that declines in Group I
significantly hefty drops of around 10% in December-loading cargoes were range- spot prices were unlikely.
prices, according to ICIS data. bound within the existing ICIS assessed
ranges, prompting expectations of largely
During the fourth quarter for both 2014 and stable spot prices among regional market
2015, price declines were largely brought participants.
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PRICING INFORMATION NEWS INFORMATION ICIS CHINA BASE OILS ANNUAL REPORT
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analysis for the Asian base oils market, including breaking news and analysis across the global market is heading and create robust plans for
price histories and expert commentary to help you petrochemical markets. Our market-moving news production and investment activities. The study also
understand the key price drivers and market conditions articles cover production updates, plant capacities, include supply and demand forecast data, import/
and settle your contract prices confidently with access output and shutdowns, plus so much more. export levels, capacity expansion plans, downstream
to time-sensitive offers, bids and price movements. demand overview and outlook, as well as analyses
on key issues and developments in the market.
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CAPROLACTAM
You can rely on ICIS for all your caprolactam market intelligence needs
ICIS offers regional price assessments and market Be the first to find out about caprolactam-related Receive an end-to-end perspective across the global
analysis for the Asian caprolactam market, including breaking news and analysis across the global petrochemical supply chain, enabling you to grasp
price histories and expert commentary to help you petrochemical markets. Our market-moving news the local or regional scenario in a global context. Data
understand the key price drivers and market conditions articles cover production updates, plant capacities, includes import and export volumes, consumption,
and settle your contract prices confidently with access output and shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for caprolactam from 1978 up to 2030.
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CAUSTIC SODA
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
operating rates due to poor margins caused started firming more sharply in the third hampered in their negotiations with northeast
by poor chlorine derivative prices. quarter, they eventually accepted higher Asian sellers due to anti-dumping duties.
prices, although many buyers were heard
The tight supply situation was slightly eased to have reduced their purchasing volumes Indian buyers were unable to accept the
by a major southeast Asian producer who or delay their purchases repeatedly in an sudden gains in export offers from northeast
started offering one spot cargo monthly in attempt to hold out for lower prices. Asia, resulting in a widening price gap.
the last quarter of the year.
Others bought domestic volumes instead. Near the end of 2016, there was a
A company source expected that they noticeable slowdown in price increases.
would be able to continue doing so Buying interest from the US West Coast
assuming smooth operations. remained stable despite the uptrend in prices. Domestic Chinese prices started to soften
as supply built up, leading to more Chinese
While buyers initially resisted the increase Spot sales to India, however, virtually producers turning their attention back to the
in spot offers, especially when prices stopped. Indian buyers were already export market.
You can rely on ICIS for all your caustic soda market intelligence needs
ICIS offers regional price assessments and market Be the first to find out about caustic soda-related Receive an end-to-end perspective across the global
analysis for the Asian caustic soda market, including breaking news and analysis across the global petrochemical supply chain, enabling you to grasp
price histories and expert commentary to help you petrochemical markets. Our market-moving news the local or regional scenario in a global context. Data
understand the key price drivers and market conditions articles cover production updates, plant capacities, includes import and export volumes, consumption,
and settle your contract prices confidently with access output and shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for caustic soda from 1978 up to 2030.
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EPICHLOROHYDRIN (ECH)
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histories and expert commentary to help you markets. Our market-moving news articles cover the local or regional scenario in a global context. Data
understand the key price drivers and market conditions production updates, plant capacities, output and includes import and export volumes, consumption,
and settle your contract prices confidently with access shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for ECH from 1978 up to 2030.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
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MALEIC ANHYDRIDE (MA)
MA MAY GAIN ON HIGHER excluding China, the bulk of MA facilities are MA exports have been limited since 2013
FEEDSTOCK COSTS butane-based. even though prices of Chinese benzene-
By Amy Tan based MA are on par with butane-based
Meanwhile, spot benzene prices in Asia material.
SINGAPORE (ICIS)--Spot prices of maleic surged above $900/tonne on 8 December,
anhydride (MA) briquette are expected to tracking sharp increases in the Chinese Buyers in southeast Asia said at current price
trend higher in January amid recent gains domestic market, according to ICIS data. levels, they are not eager to stock in excess.
in the feedstocks butane and benzene
markets, industry sources said. Only two companies in Asia outside of Price expectations from buyers are very
China Japans Nippon Shokubai and low but we feel that soon inventory will
Since mid-November, MA prices have been Indonesias Justus Sakti Raya produce reduce and buyers will start accepting the
stable at a one-year high of $1,050-1,060/ MA using benzene as feedstock. They new prices, said one regional producer.
tonne CFR (cost and freight) SE (southeast) account for about 11% of the total MA
Asia, ICIS data showed. nameplate capacity in Asia outside China, Most butane-based and benzene-based
according to ICIS data. producers said they were looking to
Suppliers were hesitant to lower offers in increase MA offers in January as their
spite of the recent decline in butane prices, In China, most producers use benzene as margins are being squeezed by higher
as their margins were squeezed by the high feedstock for MA production. The countrys feedstock costs.
cost of the feedstock since August.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
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METHYL METHACRYLATE (MMA)
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
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PARAFFIN WAX
[Downstream wax] manufacturing activities The move caught many people by surprise
are no longer as robust as say, a few years and hampered transactions, which largely Demand usually picks up a few months
ago, said another Chinese trader. occur on a cash basis. before festivities.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
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TITANIUM DIOXIDE (TIO2)
ASIANS TIO2 MARKET SEEN result of forced plant shutdowns ordered by all separately announced price hikes to be
BULLISH AMID TIGHT GLOBAL the government to curb pollution during effected from January 2017.
SUPPLY the winter.
By Leanne Tan However, further up-swings in prices could
Some market players believed that if these potentially be undermined by a weak
SINGAPORE (ICIS)--The titanium dioxide stricter environmental regulations persist downstream demand across most regions
(TiO2) market in Asia is seen to be bullish in China, it might lead to the closure of in Asia.
in the near term as prices remain supported smaller plants that are unable to pass
by tight supply of the material globally, down extra cost required to manage waste In southeast Asia, the depreciation of many
according to market players. disposal generated by sulphate-based TiO2 emerging market currencies against the
production. US dollar is expected to make imports
TiO2 prices hit rock bottom in early 2016, more expensive, and buyers are likely to
with the market price averaging around Strong TiO2 prices were also supported adopt a need-to-basis approach towards
$2,000/tonne CFR (cost and freight) Asia by higher cost of feedstock ilmenite and procurements as a result.
for the first quarter of 2016 amid a global increased transportation fees in China.
supply glut. Meanwhile, in India, TiO2 demand in the
Other international producers outside of country is expected to remain weak in the
Many regional producers were operating China have similarly announced intentions near-term following the demonetisation of
at negative margins at the start of the to hike prices for TiO2 contracts in the first high-denomination rupee notes.
year, but were unable to implement price quarter of 2017.
hikes as buyers had been unable to The Indian government implemented the
absorb increases due to prevailing weak Major producers including Ishihara Sangyo ban on rupees (Rs) 500 and Rs1,000 notes
downstream demand. Kaisha (ISK), Huntsman and Cristal have from 9 November to curb black money or
unaccounted income.
Import prices in Asia then rose from
the second quarter onwards, as many
producers adjusted operating rates
downwards due to poor margins, tightening
global supply levels.
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commercial decisions based on the content of this report. Content published between December 2016 to January 2017.
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VINYL ACETATE MONOMER (VAM)
ASIA VAM TO GET LIFT FROM expansions in the EVA sector. Taiwan in 2017 and prices in Korea could
FEEDSTOCKS, EVA START-UPS be higher than other northeast Asian
By Helen Lee Hanwha Total commenced operations in destinations due to the restriction of import
mid-November at its expanded 280,000 choices, a trader said.
SINGAPORE (ICIS)--Asias vinyl acetate tonne/year EVA plant in Daesan. The plants
monomer (VAM) prices may be buoyed up in capacity was raised by 40,000 tonnes For the first nine months of 2016, South
the first quarter by escalating feedstock costs following a shutdown from 23 October to 15 Korea imported 193,739 tonnes of VAM,
and improved demand, with recent start-ups November. up by 7% from the previous corresponding
of downstream ethylene vinyl acetate (EVA) period, according to data from Korea
plants in the region, market sources said. Korea will have to import more VAM from International Trade Association (KITA).
EVA/LDPE
Company Location Capacity Start-up schedule/status
(tonnes/year)
Jiangsu Sailboat Lianyungang, Jiangsu, China 300,000 End of 2016 to early 2017. In final state of
Petrochemical preparations.
Shanghai Petrochemical Jinshan, Shanghai, China 100,000 2017. Under Construction now.
Corporation
Yangzi Petrochemical Nanjing, Jiangsu, China 100,000 2018. Construction started on 20 Sep 2016.
Sinochem, Quanzhou Quanzhou, Fujian, China 100,000 2020. Government approval, plans to start
Petrochemical Co., Ltd. construction in 2017
Petrochemical Ligure Zhangzhou, Fujian, China 300,000 2020. Environmental assessment approval,
plans to start construction at the end of 2016 to
early 2017.
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VAM plant turnaround schedule 2017
Japan Vam & Poval Co.,Ltd 150,000 Sakai, Osaka, Japan Skip for 2017
Dairen Chemical Corp 350,000 Jurong Island, Singapore Tentatively Q2: 3-4 weeks
Sinopec Sichuan 300,000 + 200,000 Chongqing, Sichuan province, China No major shutdown plans
Vinylon Works
Sinopec Great Wall Energy 450,000 Sinopec Great Wall Energy No major shutdown plans
But this export market may exert upward VAM offtakes from downstream plants in the
pressure on VAM prices in the first quarter polyvinyl alcohol (PVOH) and butanediol
amid expectations of improved buying (BDO) sectors in China had also increased
following the lifting of Europes 5.5% import after these plants resumed operations in
duty on imports of the material in 2017. late November, industry sources said.
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PHTHALIC ANHYDRIDE
ASIA PA LIKELY TO FIRM IN Q1 ON A separate northeast Asian producer Market players anticipate that southeast
UPSTREAM TIGHT SUPPLY concurred and added that the lack of firm Asia prices will firm in tandem with the key
By Amy Tan discussions is largely due to the fact that China market in February, amid tight supply.
Chinas main ports will be closed during the
SINGAPORE (ICIS)--Asia phthalic Lunar New Year festival. Meanwhile, buyers in southeast Asia are
anhydride (PA) spot prices are expected expected to continue to procure cargoes
to firm in the first quarter on the back of In addition, production of downstream on a need-to basis. On 5 January, offers
tight supply seen in upstream feedstock dioctyl phthalate (DOP), a plasticiser, is for cargoes into southeast Asia were heard
orthoxylene (OX) market. likely to ease by 20 January, according to at $1,015-1,030/tonne CFR SE
market sources. (southeast) Asia.
PA supply is also expected to remain tight
despite the expected lull in market activity Once players in the key Chinese market My buying indication is still around $1,000/
in the weeks leading to the Lunar New Year return, however, PA prices are largely tonne CFR SE Asia. However, I have not
holiday at end-January, they said. expected to be firmer, market players said. been able to procure any cargoes at this
price, said a buyer based in southeast Asia.
Production activities in the key Chinese For now, most PA suppliers are reiterating
market are expected to wind down from the workable offers at $1,020/tonne CFR CMP. The buyer added that it managed to procure
middle of January. January cargoes at $1,020/tonne CFR SE
Over in southeast Asia, deals were concluded Asia and will continue to monitor the market
While buying interest was subdued in the at around $1,020-1,030/tonne CFR CMP on before purchasing more.
week ended 23 December, suppliers were 23 December, according to ICIS data.
hiking offers for January OX-based PA to
$1,050/tonne CFR (cost and freight) CMP
(China Main Ports) because of prevailing
tight supply and expectations of firmer OX
prices in 2017.
You can rely on ICIS for all your chemicals market intelligence needs
ICIS offers regional price assessments and market Be the first to find out about chemicals-related Receive an end-to-end perspective across the global
analysis for the Asian chemicals market, including breaking news and analysis across the global petrochemical supply chain, enabling you to grasp
price histories and expert commentary to help you petrochemical markets. Our market-moving news the local or regional scenario in a global context. Data
understand the key price drivers and market conditions articles cover production updates, plant capacities, includes import and export volumes, consumption,
and settle your contract prices confidently with access output and shutdowns, plus so much more. plant capacities, production and product trade flows
to time-sensitive offers, bids and price movements. for chemicals from 1978 up to 2030.
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