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Linear alkylbenzene's Asian profile
FOCUS the time of writing there has been no definitive statement to that effect from the company.
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Original Source: ICIS Chemical Business, 6-19 Jul 2015, 288 (1), 30 (Website: http://www. icis.com) © Reed Business Information Limited 2015
Caroline Edser
Oleochemicals Asia chemical profile: fatty alcohols
RAW MATERIALS Linear alkylbenzene Linear alkylbenzene’s Asian profile In 2014, worldwide demand for linear alkylbenzene (LAB) was projected at 3.15-3.3 M tonnes with a growth of up to 2% by 2015. Of the global demand, 48% is accounted for by Asia. Demand for the material in the region is set to grow by 3.5%/y. Further, the region makes up 45% of the worldwide LAB output with 12 plants, including eight in China and India. Decreased domestic demand during 2014 to 1Q 2015 led some producers in China to lower their production rates. Beginning 2Q 2015, tightness was seen in the market as some producers in India and other parts of Asia lowered their production rates due to plant technical issues or shortages of feedstock normal-paraffin (n-paraffin). Maintenance was also carried out by Asian and Middle Eastern producers during the period. Southeast Asian import prices for LAB at end Jun 2014 were at $1785-1850/ tonne cost and freight (CFR) SE Asia. These fell by 24% to as low as $1200-1250/tonne CFR SE Asia by end Jan 2015. By mid-Jun 2015, import prices increased to $1350-1400/tonne CFR SE Asia. In India, import prices also declined by 21% to $1200-1250/ tonne CFR India in early/mid Feb 2015 from $1760-1790/tonne CFR India end Jun 2014. These increased by mid-Jun 2015 to $1380-1410/tonne CFR India. By 3Q 2015, the LAB supply situation is expected to be better with the start of commercial operations of the new 100,000 tonnes/y LAB plant of Thai Oil and Mitsui in Sri Racha, Thailand. In China, Jin Tung Petrochemical has a 350,000 tonnes/y LAB plant in Nanjing, while Fushun Petrochemical has a 280,000 tonnes/y plant in Fushun. Unggul Indah Cahaya has a 210,000 tonnes/y plant in Merak, Indonesia.
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There is currently an oversupply of fatty alcohols following capacity additions in 2013-2015 and slowing demand. Operating rates were generally at 50-60% since 2H 2014, owing to weak margins. In 2014, Wilmar activated its new 140,000 tonnes/y fatty alcohols unit in Indonesia, while KLK Oleo started up its new facility in Malaysia with a nameplate capacity of 100,000 tonnes/y. In China, Ho Tung Group also commenced operations at its 80,000 tonnes/y fatty alcohols plant in Jiangsu in 2014 but deactivated it in May 2015 on poor margins. Unfavourable market conditions moved start-up schedules from 2014 to 2015. Ecogreen postponed the start-up of an additional 180,000 tonnes/y capacity at its plant in Batam, Indonesia, while Saudi Kayan's (Sabic) 83,000 tonnes/y unit in Saudi Arabia came on stream in 1H 2015. On the operations front, gas shortages in Medan, Indonesia, prompted Ecogreen to shut its 30,000 tonnes/y facility on 10 Sep 2014. In Jun 2015, spot prices of mid-cut C12-14 fatty alcohols averaged at $1277.50/tonne freight on board (FOB) southeast (SE) Asia, declining for a third consecutive month. Buying sentiments became bearish in Apr 2015, following the devaluation of feedstock crude palm kernel oil (CPKO) from >$1100/tonne delivered (DEL) south Malaysia in early Mar 2015 to $900/tonne DEL. Buying activities were also constrained by weakness in the downstream derivatives market, including the alcohol ethoxysulfates (AES) market in China. For C16-18 blended fatty alcohols, average prices stood at $1400/tonne FOB SE Asia in Jun 2015, gradually declining from Jan 2015 due to increasing supply. Ample US supply is the major factor for 3Q 2015 fatty alcohol contract negotiations. Contract discussions fall as much as $0.5-0.8/lb for mid-cuts, with similarly low values negotiated for the heavy chain C16-18s. Looking forward, Asian buying sentiment is expected to be on a needs basis, considering sufficient supply, CPKO volatility and weak conditions in the downstream Chinese market. Suppliers have cut production
expenses since 2H 2014, and slower decline in CPKO values could further reduce output as producers try to curb losses. Additionally, India imposed a 20% safeguard duty on fatty alcohols imports from Southeast Asian producers starting on 28 Aug 2014 with 200 days validity. This trade barrier added pressure to general market fundamentals. However, a court hearing set in Aug 2015 for objection to the duty by importer Galaxy Surfactant ['Focus on Surfactants', Dec 2014] could alter the Indian market over the coming months. Ecogreen has a 390,000 tonnes/y fatty alcohols plant in Indonesia while Kao Chemicals has 350,000 tonnes/y of capacity in Malaysia and the Philippines. KLK Oleo owns a 200,000 tonnes/y fatty alcohols unit in Malaysia. Original Source: ICIS Chemical Business, 20-26 Jul 2015, 288 (2), 123 (Website: http:// www.icis.com) © Reed Business Information Limited 2015
Indonesia delays export levy on CPO and palm products The Indonesian government has decided to postpone the imposition of export levies on crude palm oil (CPO) and processed palm products. The $50/ tonne levy on CPO and $30/tonne levy on processed palm products are intended to finance biodiesel subsidies, R&D and replanting. The Indonesian Palm Oil Association said that delays in establishing guidelines and a new biodiesel fund or agency meant that the decision would be held up as late as Aug 2015. Indonesia, the world's leading palm oil producer, has zero export tax on most palm oil shipments since Oct 2014 due to low prices. In related news, Malaysia retained its CPO export tax at 0% in Jul 2015 as prices remained below Ringgit 2250/tonne. Original Source: Oils and Fats International, Jun 2015, 31 (5), 3 (Website: http://www. oilsandfatsinternational.com) © Quartz Business Media Ltd 2015. Original Source: The Star, 18 Jun 2015, (Website: http://thestar. com.my) © Star Publications (M) Bhd 2015
Palm Oil SIG formed in Malaysia A Palm Oil Special Interest Group (SIG) has been formed by ICHEME members in Malaysia in an effort to establish a technical network around the industry. More than 60% of agricultural land in Malaysia is utilized as palm oil plantations. The country's palm oil September 2015
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S U R FAC TA N T S
Original Source: ICIS Chemical Business, 6-19 Jul 2015, 288 (1), 30 (Website: http://www. icis.com) © Reed Business Information Limited 2015
Caroline Edser
Oleochemicals Asia chemical profile: fatty alcohols
RAW MATERIALS Linear alkylbenzene Linear alkylbenzene’s Asian profile In 2014, worldwide demand for linear alkylbenzene (LAB) was projected at 3.15-3.3 M tonnes with a growth of up to 2% by 2015. Of the global demand, 48% is accounted for by Asia. Demand for the material in the region is set to grow by 3.5%/y. Further, the region makes up 45% of the worldwide LAB output with 12 plants, including eight in China and India. Decreased domestic demand during 2014 to 1Q 2015 led some producers in China to lower their production rates. Beginning 2Q 2015, tightness was seen in the market as some producers in India and other parts of Asia lowered their production rates due to plant technical issues or shortages of feedstock normal-paraffin (n-paraffin). Maintenance was also carried out by Asian and Middle Eastern producers during the period. Southeast Asian import prices for LAB at end Jun 2014 were at $1785-1850/ tonne cost and freight (CFR) SE Asia. These fell by 24% to as low as $1200-1250/tonne CFR SE Asia by end Jan 2015. By mid-Jun 2015, import prices increased to $1350-1400/tonne CFR SE Asia. In India, import prices also declined by 21% to $1200-1250/ tonne CFR India in early/mid Feb 2015 from $1760-1790/tonne CFR India end Jun 2014. These increased by mid-Jun 2015 to $1380-1410/tonne CFR India. By 3Q 2015, the LAB supply situation is expected to be better with the start of commercial operations of the new 100,000 tonnes/y LAB plant of Thai Oil and Mitsui in Sri Racha, Thailand. In China, Jin Tung Petrochemical has a 350,000 tonnes/y LAB plant in Nanjing, while Fushun Petrochemical has a 280,000 tonnes/y plant in Fushun. Unggul Indah Cahaya has a 210,000 tonnes/y plant in Merak, Indonesia.
2
There is currently an oversupply of fatty alcohols following capacity additions in 2013-2015 and slowing demand. Operating rates were generally at 50-60% since 2H 2014, owing to weak margins. In 2014, Wilmar activated its new 140,000 tonnes/y fatty alcohols unit in Indonesia, while KLK Oleo started up its new facility in Malaysia with a nameplate capacity of 100,000 tonnes/y. In China, Ho Tung Group also commenced operations at its 80,000 tonnes/y fatty alcohols plant in Jiangsu in 2014 but deactivated it in May 2015 on poor margins. Unfavourable market conditions moved start-up schedules from 2014 to 2015. Ecogreen postponed the start-up of an additional 180,000 tonnes/y capacity at its plant in Batam, Indonesia, while Saudi Kayan's (Sabic) 83,000 tonnes/y unit in Saudi Arabia came on stream in 1H 2015. On the operations front, gas shortages in Medan, Indonesia, prompted Ecogreen to shut its 30,000 tonnes/y facility on 10 Sep 2014. In Jun 2015, spot prices of mid-cut C12-14 fatty alcohols averaged at $1277.50/tonne freight on board (FOB) southeast (SE) Asia, declining for a third consecutive month. Buying sentiments became bearish in Apr 2015, following the devaluation of feedstock crude palm kernel oil (CPKO) from >$1100/tonne delivered (DEL) south Malaysia in early Mar 2015 to $900/tonne DEL. Buying activities were also constrained by weakness in the downstream derivatives market, including the alcohol ethoxysulfates (AES) market in China. For C16-18 blended fatty alcohols, average prices stood at $1400/tonne FOB SE Asia in Jun 2015, gradually declining from Jan 2015 due to increasing supply. Ample US supply is the major factor for 3Q 2015 fatty alcohol contract negotiations. Contract discussions fall as much as $0.5-0.8/lb for mid-cuts, with similarly low values negotiated for the heavy chain C16-18s. Looking forward, Asian buying sentiment is expected to be on a needs basis, considering sufficient supply, CPKO volatility and weak conditions in the downstream Chinese market. Suppliers have cut production
expenses since 2H 2014, and slower decline in CPKO values could further reduce output as producers try to curb losses. Additionally, India imposed a 20% safeguard duty on fatty alcohols imports from Southeast Asian producers starting on 28 Aug 2014 with 200 days validity. This trade barrier added pressure to general market fundamentals. However, a court hearing set in Aug 2015 for objection to the duty by importer Galaxy Surfactant ['Focus on Surfactants', Dec 2014] could alter the Indian market over the coming months. Ecogreen has a 390,000 tonnes/y fatty alcohols plant in Indonesia while Kao Chemicals has 350,000 tonnes/y of capacity in Malaysia and the Philippines. KLK Oleo owns a 200,000 tonnes/y fatty alcohols unit in Malaysia. Original Source: ICIS Chemical Business, 20-26 Jul 2015, 288 (2), 123 (Website: http:// www.icis.com) © Reed Business Information Limited 2015
Indonesia delays export levy on CPO and palm products The Indonesian government has decided to postpone the imposition of export levies on crude palm oil (CPO) and processed palm products. The $50/ tonne levy on CPO and $30/tonne levy on processed palm products are intended to finance biodiesel subsidies, R&D and replanting. The Indonesian Palm Oil Association said that delays in establishing guidelines and a new biodiesel fund or agency meant that the decision would be held up as late as Aug 2015. Indonesia, the world's leading palm oil producer, has zero export tax on most palm oil shipments since Oct 2014 due to low prices. In related news, Malaysia retained its CPO export tax at 0% in Jul 2015 as prices remained below Ringgit 2250/tonne. Original Source: Oils and Fats International, Jun 2015, 31 (5), 3 (Website: http://www. oilsandfatsinternational.com) © Quartz Business Media Ltd 2015. Original Source: The Star, 18 Jun 2015, (Website: http://thestar. com.my) © Star Publications (M) Bhd 2015
Palm Oil SIG formed in Malaysia A Palm Oil Special Interest Group (SIG) has been formed by ICHEME members in Malaysia in an effort to establish a technical network around the industry. More than 60% of agricultural land in Malaysia is utilized as palm oil plantations. The country's palm oil September 2015