PET Market dips further in South East Asia

PET bottle grade prices dipped in Asia this week. Extremely dull buying interest with weaker upstream PTA rates supported the price fall.

In China, excessive production supplies from existing players, combining Wankai new PET plant further pressured prices even lower in Asia. Wankai new plant has a production capacity at 550KMT per annum.

Despite the start of high season in China, demand remains weak because buyers are not rushing to replenish their stocks and most of them are expecting the prices to drop further.

On 12th May, PET prices reported USD905 – 910/MT due to improved demand and a rise in PX feedstock value. China producers are optimistic about the demand will increase in May until July.


Production News

·        MEG plant shuts by Sinopec Yanshan

Sinopec Beijing Yanshan Petrochemical Co Ltd has taken off-stream its monoethylene glycol (MEG) plant. A source in China informed that the company has shut the plant on May 11, 2017, ahead of Silk Road summit to be held on May 14-15 2017 in Beijing. The planned shutdown is expected to remain in force 8-10 days. Located in Bejing, China, the plant has a production capacity of 70,000 mt/year.

·        China’s Zhejiang Yisheng shuts PTA plant in Ningbo

According to market sources, China’s Zhejiang Yisheng Petrochemical had to shut its 650,000 tonnes/year No 2 PTA line at Ningbo on May 5 due to poor margins. Also, the company’s 650,000 tonnes/year No 1 PTA line has reportedly been offline for many years. The company, however, has two other PTA plants at the same location with a combined capacity of 2.2 million tonnes/year, one of which is planned to be shut in the middle of May due to a maintenance that will last for 10-15 days.

·        China’s BP Zhuhai to take PTA plant offline

According to market sources, China’s BP Zhuhai Chemical Co. Ltd. is planning to take its PTA plant offline in June due to a scheduled maintenance which is expected to last for three weeks. The plant has a production capacity of 1.25 million tonnes/year of PTA.

·        Japan’s Mitsui Chemicals plans maintenance at PTA plant

Market sources reported that Japan’s Mitsui Chemicals is planning to shut its PTA plant at Iwakuni in September due to a scheduled maintenance.

The maintenance at the 400,000 tonnes/year plant is expected to last for a month, sources said.

·        Indonesia’s Polychem takes MEG plant offline

Market sources reported that Indonesia’s Polychem shut its No 1 MEG plant in Merak due to a scheduled maintenance at the end of April. How long the maintenance at the 96,000 tonnes/year plant will last is not yet known. The company also has another MEG plant with a capacity of 145,000 tonnes/year, which will be running normally during the maintenance period. 

·        Shanxi MEG plant to be shut by Yangmei Shouyang

Yangmei Shouyang is in plans to take off-stream its monoethylene glycol (MEG) plant at Shanxi. A source in China informed that the company has scheduled maintenance at the plant on May 11, 2017. The plant is expected to be taken off-line for about 4 weeks.

Located at Shanxi in China, the plant has the production capacity of 220,000 mt/year.

·        MEG plant to be shut by Sinopec Hubei

Sinopec Hubei Chemical Fertilizer is likely to undertake a planned maintenance at its monoethylene glycol (MEG) plant. A source in China informed that the company has scheduled maintenance at the plant in June 2017. The plant is expected to remain under maintenance from early-June 2017 until early-July 2017. Located at Zhejiang in Hubei province of China, the plant has a production capacity of 200,000 mt/year.

·        PCG operates MEG plant at optimum levels

Petronas Chemicals Group (PCG) is presently running its monoethylene glycol (MEG) plant at 100% of production capacity rates following an unplanned outage. A source in Malaysia informed that the company has resumed operations at the plant in end-April 2017. The plant was taken off-line on April 13, 2017, owing to technical issues. Located at Kerteh in Malaysia, the MEG plant has a production capacity of 400,000 tonne/year.

·        Ningbo PTA plant shuts for maintenance by FCFC

Formosa Chemical & Fibre Corp (FCFC) has undertaken a planned maintenance at its purified terephthalic acid (PTA) plant. A source in China informed that the company has started the turnaround at the plant on May 8, 2017. The maintenance is expected to remain in force for around 2 weeks. Located at Ningbo in Zhejiang province of China, the plant has a production capacity of 1.2 mt/year.

*Source from Polymerupdate & Chemorbis*

Native Tapioca Starch and Its Uses

Main ingredients or components of paper consist of; basic fibre (wood or cloth), additional fibre, bleaching agents, inks or dying agents, sizing agents, and filler. Sizing agents are used to make the paper structure firmer and stronger. One of the most common sizing agents is Tapioca Starch. Tapioca Starch is widely used in many industries, from food to paper. Tapioca Starch plays a huge role in the paper industry due to its whiteness, safety, cleanliness, and viscosity. It’s also a very good property in the water holding process because of its strong dryness. 

There are two types of starch including Tapioca Starch; Native and Modified. Modified Tapioca Starch is extracted from the native one with the process of enzymatic, physical, or chemical methods so that its properties change. Modified Starch itself has some sub-kinds such as anionic, cationic, and amphoteric (anion+cation). Compared to the modified one, Native Starch is more natural since it doesn’t have many chemical additives and go through such processes. This non-derivative raw material has better benefits when it comes to commercial profit and keeping green. Due to shorter production time and lack of ingredients, Native Tapioca Starch is more economic and eco-friendly. Native Tapioca Starch is indeed a natural raw material that is massively consumed yet has a smaller impact on the environment.

Southeast Asia is world’s largest Native Tapioca Starch producer. Many global manufacturers import Tapioca Starch from Southeast Asia. The humid climate and fertile land make the starch fastly produced with high quality. 

International Trading Profile supplies Native Tapioca Starch from a natural-processed farm in Cambodia. Our starch is consistently supplied to big paper manufacturers in Cambodia and Malaysia. With our Native Tapioca Starch, paper companies can feel efficiency saving because they will need less viscosity modifier to avoid viscosity reduction due to temperature change. Our Native Tapioca Starch has the sufficient thickness that can adjust with low and high temperature. Our starch is not only food-grade but also has Halal and SGS Certifications. We work closely with our research and engineering team to continue working on the best results adjusting to our customers’ standards.

How did the environmental inspections affect the raw material prices in China?

China tops the world in almost all types of air pollution, including sulphur dioxide and nitrogen oxides as well as carbon emissions and it kills an estimated 1.1 million people a year.

China’s water and soil also need fixing. More than half of China’s population of 1.37 billion does not have access to safe drinking water and 16 percent of the country’s vast expanse of land -or around 3.33 million hectares- is too polluted to farm.

China government introduced a new way to deal with industrial pollution in December 2016. The National People’s Congress promulgated China’s first Environmental Protection Tax Law (the EPT Law), replacing the existing Pollutant Discharge Fees (PDF) system in a bid to strengthen the enforcement of environmental regulations. The EPT Law provides guidelines for levying taxes on entities that emit air and water pollutants, solid wastes, as well as noise pollution, and will come into effect on January 1, 2018.

The tax means that companies that are directly responsible for air and water pollutants, solid waste and noise must pay a tax.

The government also launched central environmental inspections in 2016, when the inspection teams were dispatched to 15 provincial areas including Beijing and Shanghai in 2016 and will cover all provincial regions in 2017.

Inspectors are responsible for monitoring the local conditions and pushing local governments to fulfil their responsibilities.

Thousands of firms were inspected and imposed fines more than 60 million US dollars in 2016 for not compiling the environmental regulations. Another broad inspection which is held in April 2017 and still going on to bring back the blue sky. Thousands of companies have been checked by the inspectors and imposed fines, forced to shut or cut down the output. 56,000 of these companies will be shut down by the end of October while some of the other companies forced to reduce production which will also reduce market supply and lead to an overall rise in the price of raw materials in China.

While steel is, the main industry has been affected, some of other industries also faced the impact of the new environmental policies.

About 17% of the total production capacity of TiO2 in China was affected by production limitation and altering in the four main provinces Shanxi, Henan, Shandong and Hebei in China.

Hence, production suspensions, not only for the TiO2 producer but also upstream suppliers like ilmenite manufacturer, are tightening the supply and put pressure on TiO2 prices in China. The short supply, together with a resulted prise rise, is one of the main concerns of TiO2 manufacturers.

SMM expects that lead consumption in China’s market shows no signs of big improvement, but supply has dropped sharply, so China’s lead prices are expected to keep rising momentum for the foreseeable future.





TiO2 Fluctuation: Demand Increase, Big Populations and Environmental Policy



Two known grades of Titanium Dioxide (TiO2) are called rutile and anatase. The industries that consume the most TiO2 are paints and coatings. In paints and coatings, durability and weatherability are essential when it comes to quality. Rutile segment is preferably used in those industries since it is coated to maintain weatherability yet has less percentage of TiO2. Rutile makes end products more durable and higher in quality. However, from 2016 to 2021, the anatase segment of the global TiO2 market is projected to develop at the highest Compound Annual Growth Rate (CAGR).

Anatase may apply better in paper manufacturing because it is less coarse to the machines of papermaking. It also applies for masterbatch, as well as other broad ranges of plastics such as PVC and PE. The market for this higher percentage of TiO2 segment is predicted to grow higher due to the increasing demand for titanium dioxide, especially in the paints and coatings industries.

The global titanium dioxide application in the paints and coatings is expected to grow the most significant CAGR during the forecast period. Fast development in the automobiles and construction industries are predicted to fulfil the demand for paints and coatings consumption. In addition, TiO2 lengthens paints durability and acts protective to the substrate in paints and coatings. TiO2 usage is applicable in most kinds of paints and coatings products to give a sense of opacity and aesthetics.

The Titanium Dioxide Market in Asia-Pacific Region is projected to expand at the highest CAGR from the year 2016 to 2021. The significantly increasing population of this region is one of the main factors of the expansion. Moreover, the consumptiveness of the people also affects this economic growth. Increasing demand in main countries with the biggest populations such as China and India also take parts of the growth of the region’s TiO2 market.

At the same time, major TiO2 manufacturers in China has been experiencing shortage due to their government’s new environmental regulations. Some of the biggest plants have totally shut down their productions. Meanwhile, others remain in 30-60% capacity. One of the plants just had a fire accident, just like what happened with one of Europe’s biggest TiO2 manufacturers two months ago. Those cases have caused a significant increase of not only TiO2 price but also other raw materials. This may lead to inflations of many human needs.



SM Prices journey south in Europe & Asia

 March was a tough month for SM. The prices plunged sharply in Europe & Asia due to slow market demand and coupled with the fall of benzene. SM prices on 1st week March:

 FOB Rotterdam assessed at USD 1,515/MT,

 CFR SEA settled at USD 1,415/MT.


After weeks of struggling, though there are few price rises; SM prices continued to inch down, despite firmer crude oil & benzene rates.

SM on 31 March 2017:

FOB Rotterdam assessed at USD 1,220/MT,

CFR SEA settled at USD 1,225/MT


After few days of prices rebounded, SM declined further in Europe at the beginning of April due to quiet market demand. However, SM prices in Asia climbed further with strong buying in the key market, followed by firmer crude oil and benzene rates. Compared with the end of March 2017, SM on 10 April 2017:

FOB Rotterdam at USD 1,175/MT

CFR SEA at USD 1,255/MT


Production News:

Singapore PS plant is planning to shut down for one-month maintenance in August 2017.

South Korea’s LG Chem resumed production at its No 1 and No 2 styrene monomer plants at Yeosu after a planned maintenance that started in March.

Hong Kong Petrochemical resumed PS production on March following a maintenance since March 13, 2017.

Nippon Steel Chemical Company (NSCC) shut its No.2 styrene monomer (SM) plant for scheduled maintenance on March 24, 2017. The plant is expected to remain offline for a period of 3 weeks.

Nippon Steel Chemical Company (NSCC) restarted its No.3 styrene monomer (SM) plant on 22 March 2017, following a maintenance turnaround. The plant was shut since February 22, 2017.

Japan’s Idemitsu Kosan resumed styrene production at its 210,000 tonnes/year styrene plant at Chiba on April 1-2 after a planned maintenance

Taiwan’s Formosa Chemicals & Fibre Corp is planning to shut its largest No 3 styrene line from April to May for a month due to a planned maintenance.

An explosion happened at Taiwan’s Formosa Chemicals & Fiber Corporation’s (FCFC) No 1 styrene plant located at Mailiao due to technical issues on March 6, 2017. 4 employees were reportedly injured and the 250,000 tonnes/year capacity plant was shut after the incident and the restart date is unclear for now.


*Source from Polymerupdate & Chemorbis*

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