The Week in Chemistry: US PE contracts for March up US$0.04/lb, PP April contracts likely to follow propylene costs upward; China refinery capacity to surpass US at 937 million tonnes/year in 2022, Russia naphtha faces domestic, international avoidance

Sample article from our Chemicals Industry

LOS ANGELES , April 15, 2022 () –

 

US Resins

US PE trading volumes rebounded in the week ended April 8. 

HDPE led the way, trading at solid volumes for injection and blow molding grades. Various grades of LDPE and LLDPE also traded quickly. Export offers, however, remained limited.

US PE producers also succeeded in gaining a US$0.04/lb contract price increase for March, marking the first increase since July 2021.

PP experienced volatile propylene prices and tight supply in the face of strong demand during the week. 

While spot PP dipped by $0.01/lb due to softening feedstock costs, prices are still poised for 2022 highs.

April contracts are expected to follow feedstock propylene costs without additional margin-enhancing increases, given the $0.10/lb increase from March.

The primary source of this information is Plastics Today.
 

China Petrochemicals

China is poised to surpass the United States as the world’s top refiner with a capacity of 937 million tonnes/year in 2022, according to a report from China National Petroleum Corp.

Significant contributions to capacity this year will come from PetroChina’s Guandong Petrochemical, which will have a capacity of 20 million tonnes per year. 

Sinopec Hainan Petrochemical will also start a 5 million-tonne per year expansion in 2022.

China aims to cap its domestic refining capacity at 1 billion tonnes per year by 2025. Meanwhile, the national carbon peaking action plan calls for greater efficiency, including boosting capacity utilization rates to greater than 80%.

The primary source of this information is S&P Global Platts.


Russia Refineries

Russian naphtha, previously a major export, has been facing international sanctions in recent weeks due to the war in Ukraine.

More recently, Russian buyers have started to avoid domestic naphtha as they face international pressure to avoid Russian-sourced goods.

The trend has created a backlog of crude-based feedstock, which could weigh on refinery run rates in April, market sources say.

The primary source of this information is S&P Global Platts.

 

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