Central European petrochemical markets

Polish oil imports Jan-2024

From the total of 2.245 million tons of crude imported into Poland in January, supplies from Saudi Arabia amounted to 45.7% which was followed by Norway with 34.2%.  By volume Saudi Arabia supplied 1.120 million tons at €565.7 per ton and Norway supplied 0.779 million tons at €545.1 per ton.   Further supplies from Norway have been ensured after the include Orlen Group agreement with BP providing for deliveries of up to 6 million tons.  Overall natural gas and crude oil production in Poland has been steadily declining in recent years, with 2023 confirming this trend.  Last year the production of natural gas (in liquid or gaseous form, from extraction) dropped 3.2% to almost exactly 5 billion cubic meters.

Czech crude imports Jan-2024

Russia supplied 293,000 tons of crude to the Czech Republic in January at €540.4 per ton.  This compares against 430,574 tons in January last year.  Deliveries from Russia peaked in the middle of 2023, monthly deliveries have since declined.  However Russian crude will still have an important role in Czech crude supply until completion of the modernisation and expansion of the TAL pipeline to 4.0 million tpa.  This is intended to be completed by the end of 2024. 

Unipetrol is set to undertake maintenance activities at its Litvinov oil refinery from 4 April to 15 May.   While a broader general maintenance turnaround at the company's petrochemical site has been deferred to 2025, specific units at the site will undergo maintenance between March and May. 

MOL’s feedstock imports

Slovnaft will undertake a two-month shutdown from May, partly to help the Bratislava refinery to adjust its technology to use greater quantities of Russian oil.  This is part of the MOL Group’s wider diversification of oil supply. 

Hungary’s crude imports amounted to 5.998 million tons in 2023 of which supplies from Russia totalled 4.729 million tons from Russia which comprised 78.9%.   The advantages of cheaper Russian oil from which Hungary was benefiting in the first half of 2023 largely disappeared in the second half of the year as the EU price cap became less effective.   By December MOL paid €565.7 per ton against €325.1 per ton in January.

MOL has reiterated that it will seek to continue supplying Russian oil to its refineries through the Druzhba pipeline through Ukraine, since it does not yet see the possibility of replacing this route.  The problem facing the Druzhba comes from unintended consequences from the war.  The pipeline was shut temporarily in March following explosion caused near the Ukrainian city of Sumy.   

Last year 993,000 tons of crude was delivered to Germany through the Druzhba pipeline, with an increase projected to 1.2 million tons in 2024 but this is still not enough.  German companies want to receive more oil from Kazakhstan through the Druzhba and whilst it does not help Russian crude sales transit fees make the trade advantageous for Russia.  Kazakhstan has already received a request from the German side to increase supplies to 2.0 million tpa.  Russian oil received through the Druzhba pipeline is delivered only in the southern direction to Hungary, Slovakia, and the Czech Republic.

Polish petrochemical production Jan-2024

Ethylene production in Poland amounted to 31,000 tons in January, just under the 31,100 tons from January 2023, whilst propylene production dropped more significantly from 37,800 tons to 27,700 tons.  Due to prevailing weak demand the Metathesis plant at Plock, which can produce up to 100,000 tpa of propylene, remains idle. 

Lower ethylene and propylene production were reflected in other areas of petrochemical production.  Butadiene production at Plock dropped to 4,600 tons from 5,700 tons, whilst phenol dropped from 4,700 tons to 3,600 tons.  Import costs for monomers were much lower in January against January last year, with propylene dropping from €997.4 per ton to €834.8 per ton and butadiene cost prices dropping from €925.4 per ton to €715.9 per ton.

Ethylene production for the four Central European countries forming the Visegrad bloc finished the fourth quarter in 2023 slightly up on the second and third quarters.  At the same time plants across the region still ran at relatively low rates of utilisation.  

For propylene the falls in production have been fairly continuous since the end of 2021.  Propylene production in the plants located in Poland, the Czech and Slovak republics and Hungary dropped below 200,000 tons in the fourth quarter. 

Olefiny III project

Orlen’s new management is expected to make some changes in group strategy but  most of the key projects are expected to continue which in particular relates to the Olefiny III complex.  In order to familiarise the region's residents with the Olefiny III project at Plock, Orlen has prepared a series of meetings entitled "Olefins III Without Secrets" to the region's residents.  The first meeting took place on 19 February where residents had the opportunity to hear from experts an account of the current implementation of the investment, its preparation, course and continuation.

In addition to ethylene and propylene other products will include ethylene oxide, glycols, and styrene.  Hyundai Engineering, in collaboration with Técnicas Reunidas, secured the project contract from Orlen in June 2021.  Orlen is currently finalising the terms and conditions of financing with several financial institutions, including Korean and the Spanish Export Credit Agency (i.e. from the countries of origin of the contractors of the main project complex).   

The remaining amount will be financed from Orlen's funds, including the value of capital expenditures incurred so far towards Orlen's own contribution.  The new installations built as part of the project, on the basis of a lease agreement, will be fully handed over by SPV to Orlen.  Orlen established Orlen Olefiny in 2021 as a special purpose vehicle (SPV)) as the entity undertaking the project.  Orlen holds all the shares in the SPV and therefore has full control over the company.  It is planned that the SPV will obtain external debt financing in the form of bank loans covering a significant part of the project's capital expenditures.

Polish propylene & butadiene imports, Jan-2024

Poland imported 7,374 tons of propylene in January against 8,194 tons in January 2023.  Imports from Germany increased from 4,990 tons to 6,652 tons. 

Average monomer trade prices dropped from €997.4 per ton in January 2023 to €834.8 per ton in January 2024.  Prices for propylene started falling in the latter part of the 2022 following feedstock trends, but then stabilised towards the end of 2023 and start of 2024.    

Butadiene import prices for Poland dropped from €925.4 per ton in January 2023 to €715.9 in January this year, with volumes rising from 6,759 tons to 7,019 tons.  Imports into Poland from Austria amounted to 3,378 tons against 3,821 tons in January last year.

Hungarian propylene exports Jan-Dec 2023

Exports of propylene from Hungary amounted to 83,442 in 2023 tons versus 89,378 tons in 2022.  Although MOL currently produces more propylene than it consumes it is currently building a new propylene plant with a capacity of 100,000 tpa which is targeted for conversion into propylene oxide. 

Export prices from Hungary dropped from €1269.4 per ton to €1039.0 per ton in 2023, following the trajectory in European pricing.   Exports to Slovakia from MOL to Slovnaft increased from 77,975 tons to 81,309 tons in 2023.  Slovnaft uses propylene for the production of polypropylene as its cracker is unable to meet full demand.

Hungarian butadiene exports amounted to 41,841 tons in 2023 against 49,609 tons in 2022.  Shipments to Poland totalled 23,078 tons in January to December 2023 against 35,355 tons in 2022.  Exports to Germany dropped from 6,049 tons to 3,014 tons and to the Czech Republic rose from 8,205 tons to 15,749 tons.  Average prices for Hungarian butadiene exports fell to €817.4 per ton versus €1018.9 in 2022.

Czech olefin trade Jan-2024

Exports of ethylene from the Czech Republic amounted to 1,191 tons in January 2024 against 1,257 tons in January last year, whilst propylene volumes dropped from 14,323 tons to a few hundred tons.   Czech imports of ethylene dropped from 871 tons to 160 tons in January 2024 whilst propylene imports amounted to 3,842 tons versus 4,674 tons.  All of the propylene was sourced from Germany at an average price of €844.9 per ton. 

Hungarian styrene imports Jan-Dec 2023

Imports of styrene into Hungary totalled 69,986 tons in January to December 2023, down from 95,794 tons in 2022.  Prices for styrene imports into Hungary dropped from €1672.9 per ton to €1498.5 per ton in 2023.

Central European polyethylene production

Polyethylene production throughout Central Europe dropped to just over 200,000 tons in the fourth quarter last year largely in response to weak demand.  This was the lowest volume of production since the pandemic. 

Production of polyethylene in Poland increased from 25,200 tons in January 2023 to 29,500 tons in January this year whilst polypropylene fell from 24,900 tons to 21,600 tons.   

Polish polyethylene trade Jan-2024

Polish trade in polyethylene in January this year reflected an increase in market activity compared to January 2023.   Last year’s production was underpinned by weak market performance, but the forecasts for 2024 and slightly more optimistic.   Based on production and trade Polish consumption of polyethylene increased from 92,000 tons in January last year to 111,900 tons in January 2024.  

Poland carries a large deficit in total polyethylene supply, which is part of the reason behind Orlen’s investment project Olefiny 111 at Plock now under construction. At the outbreak of the war in Ukraine, in February 2022, Orlen was following the plan to contract contractors for the OSBL infrastructure.  The war has had side effects on the project, indirectly affecting the  availability of materials and resources. 

Polish imports of polyethylene Jan-2024

Polish imports of polyethylene totalled 114,320 tons in January 2024 which was up from 90,640 tons in January 2023.  Average prices fell from €1503.6 per ton to €1267.7 per ton.  HDPE is the largest category of imported polyethylene into Poland, amounting to 36,224 tons in January which was higher than the 31,167 tons achieved in January last year.  All categories of polyethylene imports increased in the first month this year, which meant despite lower prices that overall costs rose from €136.3 million to €144.9 million.

The largest jump in ethylene polymer imports applied to ethylene alpha olefins where shipments increased from 13,069 tons in January last year to 24,023 tons.  European sources of ethylene alpha olefins included Germany, Belgium and the Netherlands but the largest supplier in January was from the US which provided 7,833 tons.

Regarding LLDPE, imports increased from 16,380 tons to 18,278 tons.   Most of the LLDPE imports were sourced from West Europe, including France, the Netherlands and Germany.

Polish exports of polyethylene Jan-2024

Polish polyethylene exports amounted to 24,007 tons in January 2024 against 23,565 tons in January last year.   Average prices for polyethylene exports from Poland in January rose to €1215.1 per ton from €1213.1 per ton.  Exports of LDPE increased from 3,445 tons to 5,475 tons whilst HDPE exports dropped from 16,957 tons to 15,450 tons. 

Czech polyethylene trade Jan-2024

Czech polyethylene exports amounted to 35,634 tons in January 2024 against 29,422 tons in January last year whilst imports increased from 22,703 tons to 25,527 tons.  HDPE exports increased from 25,987 tons to 31,346 tons whilst imports of LDPE increased from 7,713 tons to 9,289 tons.  

Germany is the largest destination for Czech HDPE exports supplied from Litvinov.  Other important markets for Czech polyethylene exports include Poland, Italy and Belgium.  Polyethylene export prices dropped from €1432.7 per ton to €1293.4 per ton, whilst import prices dropped from €1814.9 t €1445.0. 

Unipetrol-polyolefin production 2023

Unipetrol’s polyethylene and polypropylene dropped in 2023 against 2022, although the Litvinov polyolefin plant performed better than the other plants in Central Europe.   The third quarter last year was the strongest for polyethylene production over the 2022-2023 timeframe, amounting to 104,000 tons.  The second quarter recorded only 70,000 tons.  Polypropylene production was also affected in the second quarter by plant maintenance and amounted to 31,000 tons against 76,000 tons in the corresponding quarter in 2022.

Rompetrol Rafinare-polyolefin production 2023

Rompetrol Rafinare produced 26,000 tons of polymers in the fourth quarter last year against 35,000 tons in the same period in 2022.   In total polymer production for Rompetrol Rafinare amounted to 105,000 tons against 129,000 tons in 2022.  The company sold 117,000 tons of polymers versus 138,000 tons in 2022.  The most important distribution channels for polymers comprise the Romanian domestic market with 50%, and for export markets Bulgaria 19%, Italy 6% and Serbia 5%.  

The distribution of petrochemical products sold by Rompetrol Rafinare was undertaken by means of auto and railway in the case of sales on the domestic market.  For sales on the foreign market, the distribution of these products was made both by means of automotive and maritime transport through the ports of Agigea and Constanta.

HIP Petrohemija-polyolefin production Jan-Dec 2023

HIP Petrohemija at Pancevo reduced polyethylene exports in 2023 to 94,893 tons against 119,566 tons in 2022, with revenues dropping from $182.6 million to $112.5 million.  Currently Petrohemija does not produce polypropylene but supplies propylene to Hipol at Odžaci where a 35,000 tpa plant is in operation.  Petrohemija has already started construction of its own polypropylene plant at Pancevo.     NIS will invest more than €150 million in the construction of a new polypropylene plant.  NIS increased its ownership stake in Petrohemija from 20.86% to 90%, with the obligation of recapitalization in the amount of €150 million and the construction of a polypropylene plant.

Hungarian polyethylene trade Jan-Dec 2023

Hungary remains a net exporter of LDPE and HDPE and still a net importer of LLDPE and ethylene copolymers.  Imports of all grades of polyethylene into Hungary amounted to 200,163 tons in 2023 against 218,789 tons in 2022.  Import costs for polyethylene fell to €317.924 million against €373.967 million. 

Hungarian import prices for polyethylene decreased on average from €1709.3 in January to December 2022 to €1588.3 in 2023.  Gradual price declines took place throughout the year.

Hungarian polyethylene exports amounted to 334,992 tons in 2023 versus 337,120 tons in 2022.  Revenues fell from €525.561 million to €421.915 million in 2023, resulting in average prices dropping from €1559.0 per ton in 2022 to €1259.5 per ton. 

Polish polypropylene production & prospects

Polish polypropylene production dropped from 24,900 tons in January 2023 to 21,600 tons in January 2024.   Currently polypropylene production in Poland takes place at Plock but depending on Azoty’s finances production could start soon at the new Polimery Police plant.  This plant was expected to start in August or September 2023, but problems with the equipment during the start-up phase has been the cause of the delay.  Hyundai had set the start-up date for 13 February 2024, but this has been revised to some stage in the first quarter.

Polimery Police-prospects for success

At the start of March Grupa Azoty Polyolefins reached agreement with financial institutions for financing the completion of the Polimery Project.  The agreement involved the requirement that Grupa Azoty and Grupa Azoty Zaklady Chemiczne Police will pay the remaining amount of the loan, up to €105 million by 27 March. 

The agreement is an important step on the way to the start of commercial operation of the plant.  Completion of the project is associated with the achievement and maintenance by Hyundai of the guaranteed parameters in the license agreements for the PDH propylene production unit and the PP polypropylene production unit.

The domestic market offers great scope for sales as Poland possesses a huge imbalance in polypropylene supply.   This is despite the decline in consumption in the past two years, dropping from 1.103 million tons in 2021 to 954,800 tons in 2022 to 944,500 tons in 2023. 

Polypropylene production was higher in 2022 over 2021, rising to 321,800 tons over 301,700 tons, but then dropped to 265,100 tons in 2023.  Both exports and imports dropped in 2023 to 892,600 tons and 213,100 tons respectively.

Polish PP Trade Jan-2024

Polish polypropylene imports, including homo grade and copolymers, increased in January against January 2023, rising from 68,809 tons to 84,558 tons.   Average prices per ton decreased from €1573.9 to €1332.1 per ton. 

Homo grade polypropylene imports increased from 45,087 tons to 56,820 tons, whilst copolymer imports dropped from 22,516 tons to 26,082 tons.   Aside European suppliers for homo grade PP, South Korea provided 5,963 tons to Poland in January.  The largest supplier of copolymers was Germany, providing 6,770 tons in January followed by the Netherlands with 4,912 tons.

Regarding export activity from Poland, shipments amounted to 21,210 tons in January, against 21,148 tons in January 2023.  Despite the similarity of volumes prices dropped from €1531.9 per ton last year to €1366.6 this year. 

Czech polypropylene production and trade Jan-2024

Exports of all forms of polypropylene from the Czech Republic amounted to 23,000 tons in January against 26,402 tons in January 2023, with average prices dropping from €1530.7 per ton to €1392.0 per ton. 

Homo-grade PP provides the main category of Czech polypropylene exports, amounting to 18,289 tons versus 21,875 tons in January 2023.   Imports of homo grade PP increased from 23,162 tons last year to 25,526 tons, whilst copolymer imports increased from 15,975 tons to 17,242 tons in January 2024. 

For imports of all forms of polypropylene, Czech inward shipments increased from 40,491 tons in January 2023 to 43,931 tons in January this year, with average prices dropping from €1693.7 per ton to €1485.9 per ton. 

Hungarian polypropylene trade Jan-Dec 2023

MOL shipped 122,750 tons of homo grade polypropylene (valued at €163.023 million) in January to December 2023 versus 121,977 tons in 2022 (€199.513 million in value).  Copolymer exports dropped from 93,630 tons (€166.023 million in value) to 86,965 tons (€122.294 million).    Hungarian export revenues dropped for all grades of polypropylene from €384.606 million to €303.820 million, with average prices dropping from €1662.4 per ton to €1350.8. 

Imports of polypropylene into Hungary totalled 199,126 tons in 2023 against 210,111 tons in 2022 with average prices falling from €1792.9 per ton to €1605.0 per ton. 

Homo PP imports dropped from 124,790 tons to 118,779 tons in 2023, whilst copolymer imports dropped from 56,461 tons to 50,818 tons.  The Czech Republic was the largest source of homo PP imports, followed by South Korea and Germany.  

Czech synthetic rubber trade Jan-2024

European rubber trade prices could see some rises in the second quarter due to some supply side pressure.  Price rises for synthetic rubber could be influenced from natural rubber where major exporting nations such as Thailand, Malaysia, and Indonesia have increased prices in March to consumers such as the US and Germany.

Czech rubber trade prices started 2024 at fairly stable levels although much lower than at the start of 2023.  Export prices of synthetic rubber prices dropped from €2103.9 per ton to €1674.8 per ton whilst import prices dropped from €2473.9 per ton to €2067.3 per ton.   

Czech exports of synthetic rubber amounted to 149,520 tons in January to December 2023 versus 182,509 tons in 2022.  Imports declined from 155,873 tons to 98,084 tons in January to December 2023.  Natural rubber imports into the Czech Republic dropped slightly from 91,849 tons to 88,822 tons.   

Czech imports of butadiene amounted to 11,020 tons in January whilst exports amounted to 12,950 tons.  Imports increased from 10,574 tons in January 2023 and exports dropped slightly from 12,660 tons. 

The largest share of synthetic rubber exports from the Czech Republic comprises butadiene rubber where exports amounted to 11,160 tons in January against 7,841 tons in January 2023.  Exports of ESBR have almost been phased out after the closure of the Kralupy plant in March last year. 

Czech exports of butadiene rubber to are sold mostly to European customers but also India and South Korea.  Besides exports the Czech Republic also imported 1,814 tons of butadiene rubber in January versus 27,530 tons in the same period in 2022.  Average export prices fell from €2084.1 per ton to €1526.0 per ton.    

Hungarian synthetic rubber imports Jan-Dec 2023

Hungarian imports of synthetic rubber amounted to 124,151 tons in 2023 versus 132,397 tons in January to December 2022, whilst import costs dropped from €377.669 million to €275.309 million.  Average prices dropped from €2852.6 per ton to €2217.5 in 2023.  Butadiene rubber imports into Hungary declined from 48,207 tons to 43,470 tons, with costs dropping from €108.353 million to €77.916 million.  Imports from Russia into Hungary dropped from 13,142 tons to 2,318 tons in January to December 2023 whilst imports from Indonesia rose to 14,479 tons from 8,288 tons.    

Aside imports of synthetic rubber Hungarian exports amounted to 66,059 tons in 2023 for revenues of €185.194 million, which showed an increase over 2022 from 60,353 tons for revenues of €161.756 million.  The largest share of Hungarian exports in 2023 comprised SBR (HS code: 40021930) for 46,428 tons which increased from 31,241 tons in 2022.  Revenues increased from €93.110 million to €138.588 million.  Synthetic rubber produced at Tiszaujvaros is part of a joint venture with Japan Synthetic Rubber holding 51% and MOL 49%. 

Polish rubber prices and trade, Jan-2024

Rubber import prices into Poland for both synthetic and natural have seen gradual declines from last year as a combination of economic factors have taken effect.  Poland imported 20,856 tons of synthetic rubber in January against 20,910 tons in January 2023. 

Imports of butadiene rubber amounted to 5,630 tons in January of which Russia supplied 2,298 tons.  Russia also supplied 2,253 tons of isoprene rubber to Poland in January from the total of 2,351 tons. 

Imports of halogenated butyl rubber from Russia have now been phased out which meant that Polish imports dropped from 2,474 tons in January 2023 to only 232 tons this year.   In other categories of Polish imports of synthetic rubber inward shipments of EPDM dropped from 3,559 tons in January last year to 3,146 tons this January.  Block SBR imports increased from 2,422 tons to 2,656 tons, with Russia supplying 1,117 tons from Voronezhsintezkaucuk.  Deliveries of synthetic rubber from Russia will be allowed up to June 2024, after which EU sanctions will take full effect.   

Synthetic rubber exports from Poland amounted to 26,694 tons in January which was up from 19,089 tons in the same month last year.  Exports of butadiene rubber from Poland amounted to 4,702 tons against 3,888 tons, whilst exports of SBRs increased from 12,301 tons to 17,341 tons.  Major destinations for Polish butadiene exports were led by Belgium and the Czech Republic.  In other product areas Poland increased exports in January of butyl rubber and isoprene rubber.   Overall average prices for synthetic rubber exports dropped from €2259.5 per ton in January 2023 to €1506.0 in January this year. 

Synthos production January 2024

Synthos reduced the production of synthetic rubber in January to 20,500 tons from 20,900 tons in the same month in 2023.  Polystyrene production at Oswiecim decreased from 6,300 tons to 5,100 tons and the production of expandable polystyrene dropped from 8,400 tons to 7,800 tons.

Synthos Synthetic Rubber, with production facilities in Germany, the Czech Republic and Poland, has received ISCC low emission certification for its entire portfolio of synthetic rubber products. These include solution styrene-butadiene rubber (S-SBR), emulsion styrene-butadiene rubber (E-SBR), high and low cis polybutadiene rubber (Nd-BR, Ni-BR and Li-BR) and recycled rubber powder.  With sanctions on Russian rubber trade taking full effect in June this year Synthos is likely to fill part of the market gaps for some grades, particularly butadiene rubber. 

As a non-integrated producer feedstock supply remains one of the chief challenges for Synthos.  In an attempt to address the supply of butadiene monomer Synthos signed a preliminary agreement with OMV at the end of 2023 to commit to a long-term cooperation on sustainable butadiene until 2030.  This initially involves using palm fatty acid distillate as raw materials.  Sustainable butadiene will be produced in the steam cracker at the Burghausen refinery in Germany. A first batch of sustainable butadiene was successfully delivered to Synthos in 2023.

Synthos will use the butadiene to produce Solution Styrene-Butadiene Rubber (S-SBR), which is used in high performance tire tread compounds for low rolling resistance, which means reducing the energy loss of a tire rolling on the road. This in turn increases the vehicle’s energy efficiency and reduces environmental impact.  All Synthos production facilities, including Synthetic Rubber plants in Poland, Czech Republic and Germany, received full ISCC PLUS certification in 2022.

Polish aromatic exports Jan-2024

Polish exports of benzene totalled 11,320 tons in January this year against 16,348 tons in January last year.  Germany purchased 10,234 tons from Poland in January which was up on 9,999 tons from last year whilst shipments to the Czech Republic dropped 5,307 tons to 1,086 tons.  Average prices amounted to €785.9 per ton in January.  Benzene is produced in Poland at Kedzierzyn-Kozle and Plock. 

PTA exports from Poland increased to 22,430 tons in January this year against 20,247 tons in January 2023, although still down on traditional volumes.  Exports to Germany rose to 19,736 tons from 17,812 tons.  Export prices dropped from €987.3 per ton to €771.4 per ton. 

PTA consumption in Poland is based largely on two PET plants in Poland which are owned by Indorama and Elana PET.  Indorama operates a PET plant at Wloclawek with a capacity of 216,000 tpa.  There is a smaller PET plant at Torun, managed by Elana PET which is part of the holding Boryszew.  Regarding trade in PET imports into Poland amounted to 228,604 tons in 2023 for costs of €253.724 million whilst exports from Poland amounted to 130,561 tons for €161.774 million.

Other important regional plants include the Neo Group in Lithuania which resumed operations on its third PET production line at its Klaipeda facility at the end of February.  At full capacity the company can produce 480,000 tpa of PET.  The Klaipeda plant also has a capacity of 9,000 tpa of polyols.

Polish-Czech aromatic imports Jan-2024

Phenol imports into Poland amounted to 7,107 tons in January 2024 which was up from 6,519 tons in January 2023.  Germany is the dominant supplier of phenol to Poland, shipping 5,567 tons in January.  Other sources include Spain.

Phthalic anhydride imports into Poland increased from 1,645 tons in January last year to 2,483 tons, most of which came from South Korea and the Czech Republic.  Phthalic anhydride is used in Poland for the production of unsaturated polyester resins,

In other product areas, styrene imports amounted to 4,223 tons in January versus 7,165 tons whilst ethylbenzene imports increased from 10,442 tons to 11,496 tons.  All of the ethylbenzene imports come from the Kralupy plant in the Czech Republic.  In confirmation of Polish numbers Czech exports of ethylbenzene amounted to 11,492 tons in January against 10,439 tons in the same month in 2023.  All the ethylbenzene was shipped to Oswiecim, all within the structures of the Synthos Group.  Styrene exports from the Czech Republic dropped from 4,995 tons in January last year to 1,528 tons whilst at the same time imports dropped from 662 tons to 246 tons. 

Benzene exports from the Czech Republic amounted to 2,045 tons in January, all of which went to Hungary for €1.546 million.  Hungary does not normally import benzene.  Imports of benzene into the Czech Republic dropped from 7,359 tons in January 2023 to 3,134 tons in January 2023.   Benzene imports were sourced from Hungary, Poland and Serbia

Bisphenol A imports into the Czech Republic totalled 2,268 tons in January against 1,674 tons in January 2023.  Average prices dropped from €1776.9 per ton to €1410.1 per ton.  Belgium was the largest source of imports in January this year, amounting to 814 tons followed by South Korea with 704 tons.

Central European epoxy resin trade Jan-2024

Czech exports of epoxy resins amounted to 3,822 tons in January against 4,735 tons in January 2023.  Average prices dropped sharply in the corresponding first months of each yea, dropping from €3671.2 per ton to €2390.5 per ton. 

Most of Spolchemie’s epoxy resin production is exported, with a share of the Czech market amounting to only 5%.  Besides Bisphenol A, Spolchemie also uses epichlorohydrin in the production of epoxy resins, which it produces itself from renewable resource (glycerine).   The company more epichlorohydrin than it needs for epoxy resin production and thus exports up to 5,000 tpa.  

Polish imports of epoxy resins amounted to 1,771 tons in January against exports of 942 tons.  Costs amounted to €6.393 million against export revenues of €3.132 million.  Epoxy resins production in Poland is undertaken by Lerg at Pustkow, to the east of Krakow. 

Hungarian aromatic imports Jan-Dec 2023

Hungarian benzene exported 64,070 tons of benzene in 2023 against 102,209 tons in 2022.  In other areas of aromatic trade Hungary imported 76,991 tons of styrene in 2023, whilst exporting 25,226 tons of orthoxylene.

Germany was the largest customer got Hungarian benzene in 2023, taking 25,473 tons against 50,987 tons in 2022.  At the same time shipments to the Netherlands increased from 2,000 tons to 16,677 tons.  Average prices for Hungarian exports dropped to €830.1 per ton from €1008.4 per ton in 2022.  Besides exports Hungary imported 8,051 tons in 2023.

Toluene imports into Hungary amounted to 43,235 tons in 2023 for €49.180 million in value.  This compares against 35,068 tons in 2022 for a total value of €38.171 million. 

Average cost prices for toluene averaged €1137.5 per ton in 2023 against €1088.5 in 2022.  Germany was the largest supplier of toluene to Hungary in the period January to December 2023, amounting to 21,223 tons which was up from 16,427 tons in 2022.  Slovakia reduced shipments from Slovnaft’s refinery to 8,152 tons to 8,688 tons, whilst Poland reduced shipments from 5,913 tons to 1,398 tons.  The Netherlands was a new supplier to Hungary in 2023, proving 5,822 tons. 

Hungarian TDI-MDI exports Jan-Dec 2023

Hungarian TDI exports increased to 241,887 tons against 229,585 tons in January to December 2022.  The second half of 2023 showed stability in TDI shipments, in comparison to the lower-than-normal export volumes in the third and fourth quarters in 2022.  Average prices dropped from €2906.7 per ton to €2429.8 in 2023.  Prices dropped from a peak of €3255.4 per ton in January to €2009.3 per ton in December 2023 which measured against €3389.1 per ton in December 2022. 

Regarding destinations, exports of TDI to Belgium rose from 20,026 tons in 2022 to 29,732 tons in 2023 whilst volumes to Italy fell from 33,286 tons to 27,254 tons.  In other parts of West Europe Hungarian TDI exports to Portugal dropped from 11,966 tons to 11,701 tons, and to Spain rose from 9,417 tons to 10,050 tons.  In Central Europe shipments to Poland fell from 31,662 tons to 28,346 tons and Romania increased from 14,306 tons to 14,479 tons.

MDI exports from Hungary dropped in 2023 to 171,595 tons from 185,496 tons in 2022.  The first half of 2022 saw high volume shipments (116,700 tons) but only 68,400 tons were shipped in the second half of 2022.  Throughout 2023 export volumes were slightly more balanced with 91,700 tons shipped in the first half and 79,200 tons in the second. 

Poland was the largest destination for Hungarian MDI exports, shipping 32,536 tons in 2023 versus 30,438 tons in 2022.  Romania is the second largest market in Central and South East Europe, taking 14,646 tons in 2023 which was down from 19,260 tons.  

The most significant drop in Hungarian sales was the US where no shipments were made in 2023 against 23,562 tons in January to December 2022.  MDI export prices underwent a different price cycle to TDI, dropping from €2338.2 per ton to €1947.4 per ton in 2023.

Central European isocyanate trade

MDI imports into the Czech Republic totalled 2,057 tons in January 2024 against 2,487 tons in the same month in 2023.  Average prices dropped from €2766.3 per ton to €2050.0 per ton.    

MDI import prices for Poland dropped from €2358.1 per ton in January last year to €1793.3 per ton in January 2024, but volume imports increased from 9,875 tons to 12,837 tons.   Germany provided the largest share of imports, rising from 3,083 tons to 4,542 tons whilst Hungarian shipments rose from 3,318 tons to 3,708 tons. 

TDI imports into Poland amounted to 6,971 tons in January which was up from 5,008 tons in last January, with average prices dropping from €3369.4 per ton to €2051.1.  Germany increased shipments from 1,414 tons in January 2023 to 2,132 tons whilst imports from Hungary increased from 2,049 tons to 2,894 tons.

European polyol market

Polyol prices witnessed some degree of stabilisation in the latter part of 2023, although consumption remains under pressure.  The downward trend of consumption started in the second half of 2022 and was particularly noticeable in the first half of 2023.  Demand for polyethers returned to growth in September 2023 after the holiday period, a trend that continued in Q4 leading to a return to growth in sales prices.   

The most affected industries consuming polyols were construction, comfort (mattresses, chairs, furniture) and home appliances.  Low consumption of polyethers generated a continuous decrease in prices in 2023. The pressure on prices was accentuated by massive imports from China and Korea.

European prices for rigid polyols dropped from €2550 per ton in January 2023 to €2100 in December whilst flexible polyols fell from €1825 per ton to €1400 per ton.  In the fourth quarter, polyether prices increased on average by €100/ton compared to September. Quantities sold by producers and traders increased by 10% compared to the third quarter.  Total sales for the company amounted to 80,138 tons in 2023, which was 5% lower than in 2022.

Prospects for the European polyurethane sector in 2024 appear slightly better for 2024, but there are numerous external events such as problems in the Suez Canal, military tensions in the Middle East and of course the situation in Ukraine.

Regarding polyol competition from Asia, the delays caused in transportation issues could add another 14-20 days to delivery.  This could apply particularly to flexible polyols, where alternative transport routes (depending on loading ports in China and South Korea), could leading to an increase in transport cost by €100/ton. Theoretically, this will reduce the flow of imports or delay monthly imports of 5-10,000 tons of polyol that frequently arrive from Asia, and European production will have to adapt.

Thus imports are expected to fall this year and combined with plant outages in Europe undertaken in the first quarter could tighten the supply side and allow prices to rise.  This reduction in the availability of polyethers in the market could lead to a more balanced situation, and manufacturers will certainly try to regain some of profitability after almost a year of minimal or negative profitability.

Czech polyol imports Jan-2024

Czech polyol imports amounted to 3,931 tons in January this year against 3,768 tons in January 2023.  The leading supplier to the Czech market was Belgium which shipped 987 tons in against 1,223 tons, followed by France which shipped 929 tons.  Average prices dropped from €2419.9 per ton to €2282.1 per ton.

Hungary imported 33,467 tons of polyols in the first ten months in 2023 against 27,624 tons in the same period in 2022.  The largest source of imports came from Belgium in the first ten months, amounting to 12,694 tons against 2,218 tons in the same period in 2022.  Deliveries from China amounted to 8,671 tons versus 10,028 tons. 

Polish polyol trade Jan-2024

Polish polyol imports amounted to 10,929 tons in January against 9,936 tons in January last year.  The major sources of imports came from Belgium, Germany and the Netherlands.  Polyol import prices dropped from €2225.4 per ton to €1865.3 per ton.  The largest source of imports came from the Netherlands, rising from 1,592 tons to 2,876 tons this January followed by Germany which supplied 2,357 tons. 

Exports of polyols from Poland dropped from 5,292 tons in January 2023 against 4,340 tons in January this year with average prices dropping from €2278.1 per ton to €2022.3 per ton.  Nearly all exports were sold on European markets.

 With the construction of a fifth production line for polyether polyols two years ago, PCC Rokita increased its capacity to 110,000 tpa (measured in terms of standard polyols). The fifth production line is mainly used to manufacture intermediate products for the further polyols production.

The PCC Rokita Group is the largest polyol producer for the production of polyurethanes used in the automotive, furniture and construction industries. The production of polyurethanes in Poland is carried out by Ciech Pianki at Bydgoszcz.  

The European polyol market is estimated to comprise around 600,000 tpa.   The main product group is polyester polyols and the dominant market is the segment of panel manufacturers layered.  Demand of this market segment is estimated at between 200-220,000 tpa.

Hungarian imports of polyols increased in 2023 to 37,728 tons against 30,806 tons in 2022w with imports from Belgium increasing from 2,611 tons to 12,887 tons.  Volumes from China dropped from 11,091 tons to 9,774 tons. 

Polish oxide-glycol trade

Ethylene oxide imports into Poland amounted to 6,881 tons in January which was down from 10,971 tons in January last year.  Poland stopped importing ethylene oxide from Russia in May 2022 and Germany currently represents the main source of inward shipments.  Ethylene oxide is used in Poland mostly by PCC Rokita and PCC Exol.  Ethylene glycol imports dropped to 6,881 tons in January which was down from 10,971 tons last year.  Belgium supplied the largest volume of glycols to the Polish market.  

Regarding diethylene glycol (DEG), imports amounted to 2,247 tons in January against 1,961 tons last year.  In the past year Saudi Arabia has become the largest supplier of glycols to the Polish market. 

Increased consumption is one factor behind the increased imports from Saudi Arabia, the disappearance of Russian DEG has also meant that Polish consumers have had to buy from other sources.  Imports from Russia amounted to 7,807 tons in the whole of 2021 but dropped to 1,192 tons in 2022 and zero in 2023.

Hungarian maleic anhydride exports Jan-Dec 2023

Hungary exported 19,825 tons of maleic anhydride in 2023 against 20,863 tons in 2022, with average prices dropping from €2032.8 per ton to €1155.1 per ton.  Export shipments to Austria amounted to 2,941 tons against 4,359 tons in 2022, whilst exports to Poland dropped from 4,849 tons to 2,859 tons.  Other markets included Italy, Germany and Slovenia. 

Hungarian acrylonitrile imports Jan-Dec 2023

Hungary imported 17,472 tons of acrylonitrile in 2023 against 57,702 tons in 2022.  The Netherlands was the main source of imports in both years, shipping 10,736 tons in January to December 2023 versus 36,858 tons in 2022.  Acrylonitrile prices dropped on average from €2335.2 per ton to €2065.4 per ton in 2023. 

Hungarian aniline imports Jan-Dec 2023

Aniline imports into Hungary amounted to 102,754 tons in 2023 against 173,173 tons in 2022.  BorsodChem opened its new plants for nitrobenzene and aniline at the start of July 2022 which has reduced the need for imports.  The nitrobenzene plant consists of a capacity of 240,000 tpa and aniline at 200,000 tpa.  Shipments from BorsodChem-MCHZ in the Czech Republic to Hungary amounted to 65,110 tons against 148,579 tons in 2022.   Belgium supplied 24,545 tons in 2023 against 17,129 tons in 2022.  Cost prices of aniline imports into Hungary dropped from €1733.8 per ton to €1401.2 in 2023.

Polish organic chemical trade Jan-2024

Volumes and values of Polish organic chemical trade, in both exports and imports, were lower in January against January 2023 but at the same time showed signs of stabilisation.  Exports of organic chemical products dropped from 108,900 tons to 96,000 tons whilst revenues dropped from €148.3 million to €118.5 million.  Some of the main organic products exported by Poland include normal butyl acetate. 

Imports of organic chemicals dropped slightly from €377.1 million to €309.9 million.  Methanol imports into Poland totalled 44,461 tons in January against 52,170 tons in January 2023. Acetic acid imports dropped from 3,285 tons to 1,269 tons, with average prices dropping from €1043.8 per ton to €632.7 per ton.

Ethyl acetate imports into Poland amounted to 1,405 tons in January 2024, with shipments arriving from Mexico, South Africa and Germany.  Average prices for ethyl acetate imports dropped from €1319.3 per ton in January 2023 to €1123.9 per ton this year.  VAM prices also reflected the lower feedstock costs, dropping from €1460.8 per ton in January last year to €1246.8.  Imports of VAM increased from 1038 tons to 1300 tons this year with Saudi Arabia providing over half of the supply.

Central European methanol trade Jan-2024

Czech imports of methanol amounted to 6,212 tons in January 2024 against 6,105 tons in January 2023.  Imports from Poland amounted to 4,851 tons versus 4,044 tons whilst Estonia supplied 1,212 tons.  Prices per ton for methanol imports amounted to €402.0 per ton in January.

Imports of methanol into Poland were completely restructured in January this year with the leading supplier replaced by Venezuela against Russia.  Imports from Venezuela amounted to 20,245 tons in January against imports of 33,690 tons from Russia in January 2023.  Other sources this year have included shipments from Germany, Belgium and Norway. 

In place of Russian exports Poland increased imports from Norway, rising from 30,160 tons to 101,129 tons and from new countries such as Trinidad which supplied 43,007 tons in 2023 and Venezuela which supplied 38,759 tons.  Average costs for Polish methanol imports dropped from €380.4 per ton in 2022 to €301.8 in 2023.

Exports of methanol from Poland amounted to 17,705 tons in January against 28,569 tons in January 2023.  Trade increased in the first year of the war as Poland became a trading route for Russian methanol supply which could not access South East Europe directly.  However, the EU sanctions on Russian methanol means that this source of product is no longer available and as a result Polish volumes have fallen since 2023.  Average prices for Polish methanol exports dropped from €403.5 per ton in January last year to €383.2 in 2024.

Imports of methanol into Hungary totalled 90,989 tons in 2023 versus 109,150 tons in 2022, with average prices falling from €559.5 per ton to €426.6 per ton.  Germany provided 35,513 tons which was up from 16,456 tons in 2022, whilst inward shipments from the Netherlands increased from 12,464 tons to 26,702 tons.  Imports from Russia were not carried out in 2023 against 21,526 tons in 2022. 

Azerbaijan has replaced some of Russia’s previous market share in Europe.  The top five importers of methanol from Azerbaijan include Romania, Italy, the Netherlands, Spain and Lithuania.   Exports to the EU from Azerbaijan’s SOCAR plant amounted to 260,700 tons in 2023 which was 0.4% down from 2022.  

Romania imported 82,300 tons of methanol from Azerbaijan in 2023 against 60,100 tons in 2022, whilst the Netherlands reduced imported from 105,800 tons in 2022 to 71,300 tons.  

Grupa Azoty Jan-2024

Debt issues for Grupa Azoty have raised the spectre of deconsolidation even though the group wants to stay in its current format.  The government, which has an interest in Azoty, tends to want to retain the group as it stands at the same time there are question marks regarding the investment of a coal fired plant at Pulawy and the polypropylene project for Polimery Police. 

The new management team is currently working on a new strategy which may take several months before becoming evident.  The addition of the Polimery Police plant to Grupa Azoty could help significantly to the financial performance of Grupa Azoty which has been under pressure from energy and raw material costs in the past two years.  

Strong competition from Asian fertiliser producers, which benefit from both competitive labour costs and lower energy prices have been a major problem in the past two years.  Moreover, the plastics segment has had a very difficult time in conjunction with the downturn in the construction and automotive industries. High costs combined with weak demand have presented challenges to Grupa Azoty in managing production and sales.  In the chemical segment, prices are falling due to lower demand from European customers and thus effectively all the main product groups are under pressure. 

The company currently has high debt, high financing costs, and a new complex that is not yet generating cash.  Orlen has indicated that it is ready to take over the Pulawy plant from Grupa Azoty, but for at least the time being this interest has been rejected.

Chimcomplex Jan-Dec 2023

Romanian chemical producer Chimcomplex operated at a reduced capacity over 2023 due to market circumstances.  Costs declined last year for raw materials and energy, and average prices of one the company’s main feedstocks propylene reduced from €1241 per ton to €701 per ton.  Despite lower costs overall, margins have been restricted by lower prices for polyols.  Chloralkali sales helped offset the weakness in polyol sales and allowed the company to attain a 8% margin between January and December 2023.   Energy costs were significantly lower this year for both natural gas and electricity.

Chimcomplex’s turnover totalled €275 million in 2023, decreasing from €350.861 million in 2022.   The company recorded an operating profit of €22.542 million in 2023 and the net profit amounted to €15.296 million, decreasing from €23.160 million in 2022.  In the context of a continued decline in consumption that began in the second half of 2022, Chimcomplex’s sales volume decreased by 38% in 2023 compared to 2022.  However, cost reduction efforts led to achieving an operating profit margin of 8% in 2023.

The drop in turnover was caused by lower quantities sold by the company.  Chimcomplex focused its activity on the polyols/polyethers and caustic soda sectors, which were the most profitable. The share of the main products in total sales comprised 48.9% for polyols and 46.5% for chloralkali products.

PCC Rokita Jan-Dec 2023

Due predominantly to the weakness in the polyurethane sector and polyol sales, PCC Rokita reduced net profits from  €143.994 million in 2022 to €59.155 million in 2023.  The company generated revenues of €527.381 million, which was 26% lower than in 2022.  In terms of product shares, polyols accounted for 42% of PCC Rokita’s sales, with the chlorine division accounting for 44% and phosphorous chemicals 8%.  By region, 48% of total sales were shipped to the Polish market, 24% to the EU,14% to Germany and 3% to Asia.

Revenues declined in all three sectors, but the chlorine division recorded the largest proportional fall.   The decline in revenues from these three complexes was caused, on the one hand, by lower sales volume and, on the other hand, by lower average sales prices of the offered products.

Significant factors affecting the segment's result in relation to 2022 included a decrease in demand for polyether polyols, increased market availability of polyether polyols from outside Europe, and a decline in prices and margins on the market.

Profitability in the European polyol sector has reached its lowest levels in many years, despite the improvement in the third and fourth quarters.  Margins for PCC Rokita’s polyurethanes dropped from 12.2% in January to December 2022 to only 4.1% in 2023, although the chlorine sector’s margins only dropped from 26.7% against 40.1%. 

PCC Exol Jan-Dec 2023