The Week in Chemistry: US resins to continue in logistics challenges through 2022, Asia naphtha hits seven-year high of US$888.125 tonne as US sanctions on Russia impact crude prices; US chlor-alkali producers transition to membrane grade caustic soda

Sample article from our Chemicals Industry

LOS ANGELES , February 25, 2022 () –

US Resins

US resin trading during the week of Feb. 14 continued to be characterized by shipping challenges. Ongoing port congestion and high demand for shipping containers is expected to continue throughout 2022.

During the week, spot PE resin supply was relatively tight, despite official indicators suggesting ample inventories among producers. Tightness for prime material continued to reflect the US$0.04/lb contract increase suggested for February.

Spot PP resin is witnessing strong demand, rising about US$0.05/lb thus far in February. Markets expect contracts to increase by at least US$0.05/lb for February, supported by rising polymer-grade propylene costs.

The primary source of this information is Plastics Today.

 

Asia Naphtha

Prices for C+F Japan naphtha cargo hit US$888.125/tonne on Feb. 22, a seven-year high.

The recent assessment is also more than 20% higher than the US$738.125/tonne at the start of 2022.

Naphtha’s upward journey is trailing crude prices, which have spiked as a result of Western sanctions against Russia as tensions rise between Russia and Ukraine.

The trend is weighing on margins for olefins producers, which could lead to producers cutting operating rates, sources say.

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

 


US Caustic Soda

Occidental Petroleum’s CFO Robert Peterson announced on February 25 that the company is considering an overhaul of certain chlor-alkali assets to produce higher-value products.

The company will share additional details after making a final investment decision later in 2022.

According to Peterson, pivoting from diaphragm-grade to membrane-grade caustic soda would reduce the carbon intensity per ton of product.

Another major producer, Olin, has also been shutting diaphragm-grade capacities as part of a strategy to reduce its presence in so-called weaker markets. The company plans to permanently shut a production unit in McIntosh, Alabama, in Q3 2022. The latest would bring Olin’s total diaphragm-grade shutdowns to 855,000 tonnes/year since 2021.

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

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