Crude pipeline tariffs & deliveries

Ukraine has announced that it plans to increase rates for the transit of Russian oil via the Druzhba pipeline by 18% in 2023.   The local oil pipeline operator, Ukrtransnafta, stated that this was the result of increased costs resulting from the war in the country and the destroyed energy infrastructure.  Oil is transported through Ukraine to the Czech Republic, Hungary and Slovakia.  Tariffs are to increase by €2.1 per ton, to €13.6 compared to €11.5 from April last year and the price before that €8.6.  The increase will be felt mostly by MOL and Orlen Unipetrol.  Regarding the northern section of the Druzhba Belarus may also be willing to raise rates, following the example of Ukraine.

The southern branch of Druzhba pumps about 1-1.5 million tons of oil per month.  In 2021 12 million tons were transported via this route, of which 5.2 million tons were received by Slovakia and 3.4 million tons each by the Czech Republic and Hungary.

Germany and Poland have signed a deal aimed at securing the supply of oil to the Schwedt refinery after ending reliance on Russian oil.  Berlin aims to eliminate imports of oil from Russia and has for months been working with Poland to try secure supply for Schwedt, which provides 90% of Berlin's fuel. 

Both sides want to ensure Polish refineries in Gdansk and Plock as well as German refineries in Schwedt and Leuna are adequately supplied with crude oil, ministers from both countries said in a joint declaration.  This did not provide any details on how the supply to Schwedt would be guaranteed. Schwedt is currently under German trusteeship but belongs to Rosneft.

Croatia’s sole pipeline operator, JANAF, has signed a two-year contract with Serbia’s NIS, majority owned by Gazprom Neft, for transporting crude oil to Serbia, despite previously announcing it would halt such transport as the EU tightened restrictions on Russian oil imports.  Under the deal, valid for 2023 and 2024, NIS reserved JANAF’s capacity for 6.2 million tons of crude.  According to Croatian data, JANAF carried 2.3 million tons of crude to Hungary in 2021 but only 0.95 million in 2022, and Croatian officials say that Hungary has not expressed any formal interest in using the pipeline’s full capacity.

In South East Europe a plan to build the Bourgas-Alexandropoulos oil pipeline could be revived by Bulgaria which has been supported by Lukoil.  Sofia abandoned the Bourgas-Alexandropoulos oil pipeline in 2011, following a local referendum over environmental concerns.

Central European ethylene production

Ethylene production in the four countries that comprise the Visegrad Group region fell in the third quarter in 2022.  This was mainly due to maintenance, mainly conducted at MOL’s plants in Hungary and Slovakia.  Production for the four countries totalled 293,600 tons in the period July to September 2022 against 389,200 tons in the second quarter and 405,700 tons in the same quarter in 2021.  The second quarter in 2021 saw extended maintenance by PKN Orlen which resulted in a regional total production of 276,200 tons.

PKN Orlen-petrochemical production Jan-Oct 2022

PKN Orlen increased ethylene production in the first ten months in 2022 to 352,800 tons against 266,700 tons in the same period in 2021, whilst propylene rose from 271,000 tons to 352,800 tons. 

The increase in olefin production enabled an increased in polymer production at Plock, including a rise in polyethylene output to 271,000 tons from 181,500 tons in January to October 2021 and for polypropylene from 240,600 tons to 274,500 tons.  PVC production at Wloclawek increased from 177,100 tons to 228,700 tons.

Petrochemical margins for PKN Orlen remain relatively high despite the weaker performance in the third quarter.  Positive margins help to offset the high energy costs which are affecting European petrochemical producers and represents one of the main concerns entering in 2023.  PKN Orlen's model refining margin fell to $19.9 in November 2022 from $31.4 in October.

Central European propylene production

Propylene production in the Visegrad Group region fell slightly in the third quarter to 265,800 tons from 273,300 tons in the second quarter and 298,700 tons in the period July to September 2021.  Despite the cracker shutdown at PKN Orlen in 2021 the production of propylene at the Metathesis plant helped reduce the impact of lower production of by-product propylene.  Feedstock stability and energy costs will continue to represent the primary concerns at least for the first half of 2023.

MOL’s new propylene plant

Work has started on MOL’s new 100,000 tpa propylene plant at Tiszaujvaros where structures are being established by the construction company Merkbau Zrt.  The propylene plant is being constructed on an area of about three hectares at the site of MOL Petrochemicals at Tiszaújváros.  The plant will fit into the existing production infrastructure, providing raw materials for the polyol plant, thus expanding the company's chemical production capacity. MOL Petrochemicals' new propylene plant will significantly cover MOL's chemical raw material needs.

Central European propylene trade

In the first three quarters in 2022 MOL’s propylene export price rose to €1334 per ton against €1009 per ton in the same period in 2021.  By volume exports fell in the first nine months to 58,666 tons versus 82.140 tons in January to September 2021, whilst due to the higher sales price meant revenues only dropped slightly to €76.215 million from €79.166 million.   Spot prices of propylene rose 29% in the first quarter and then rose again in the second quarter before starting to soften in the third quarter.  Exports to Slovakia are the main focus of Hungarian outward shipments of propylene, where volumes dropped from 74,400 tons in the first three quarters in 2021 to 50,500 tons in the same period in 2022.  Propylene production by Slovnaft is not sufficient to maintain high utilisation rates for polypropylene and additional supplies need to be purchased.

Polish propylene imports Jan-Oct 2022

Imports of propylene into Poland dropped in the first ten months to 113,001 tons against 180,306 tons in the same period in 2021.  This was due mostly to the higher production undertaken at Plock.  Average prices increased from €902 per ton in January to October 2021 to €1290 per tons in the same period in 2022.   Although propylene monomer has not been sanctioned by the EU, Russia has exported only small volumes to Poland in the past few months. 

To compensate for the drop in imports from Russia due to sanctions and Ukraine where production was suspended following the Russian invasion, Poland started to receive deliveries from Bulgaria, Croatia and Hungary.  The propylene from Bulgaria came from the Bourgas refinery which is owned by Lukoil and has somehow avoided the effects of sanctions even if it is a Russian company.  Shipments from Croatia and Hungary were coordinated by MOL.  Propylene production at INA’s Rijeka refinery in Croatia, which is a sub-division of MOL, started in late 2020 with a capacity of 84,000 tpa.

Polimery Police-propane agreement

Grupa Azoty Polyolefins has concluded a propane purchase agreement with Trafigura Pte. The value of benefits under the agreement will amount to approximately $250 million, in which supplies will secure over 50% of the company's demand for raw material in the period December 2022 to December 2024. 

The plant with a production capacity of 0.5 million tpa of PP will soon be in the start-up phase.  Along with the PP installation, the gas terminal will be launched.  The first delivery from the US to the Police gas terminal arrived just before Christmas.  The Guadalupe Explorer tanker delivered its 22,000 tons of propane to the port of Swinoujscie in northern Poland with the first cargo for Polimery Police.  

Other recent developments that could help Polimery Police was the creation of the West Pomeranian Hydrogen Valley in November last year.  Grupa Azoty, the largest producer of hydrogen in Poland, is strongly involved in the project.

Czech petrochemical trade, Jan-Oct 2022

Propylene imports into the Czech Republic dropped from 37,804 tons in January to October 2021 to 31,336 tons in the same period this year.  Costs of propylene imports rose to €47.525 million against €36.338 million, with average prices rising from €1168 per ton in 2021 to €1517 in 2022.  Czech exports of ethylbenzene declined in the first ten months in 2022 to 92,081 tons from 106,783 tons in the same period in 2021.  All the ethylbenzene was shipped from Kralupy to Oswiecim in Poland, all within the structures of the Synthos Group.  Benzene imports are required to cover ethylbenzene production and amounted to 64,665 tons in January to October 2022.  Imports were largely shipped from Poland

Ethylene exports from the Czech Republic amounted to 11,094 tons in the first ten months last year against 19,725 tons in the same period 2021 whilst ethylene imports rose from 3,194 tons to 16,034 tons.  Germany supplied 15,898 tons to the Czech Republic in January to October 2022, supplied from the Boehlen plant to Litvinov. 

Germany was the leading supplier of propylene to the Czech market in 2022, supplying 17,413 tons in the first ten months for €25.764 million.  Other suppliers included Romania which shipped 5,251 tons from the Petromidia refinery for €7.528 million, followed by Poland shipping 4,931 tons for €6.155 million. 

Czech imports of butadiene dropped from 66,125 tons in the first ten months in 2021 to 56,319 tons in the same period in 2022.  Germany shipped 54,530 tons to the Czech market in January to October 2021, dropping to 46,637 tons in the same period in 2022.

Central European styrene trade

Poland imported 84,555 tons of styrene in the first ten months in 2022 versus 90,497 tons in the same period last year.  The Netherlands reduced shipments from 72,434 tons to 49,213 tons whilst imports from Germany rose from 7,093 tons to 16,630 tons. 

Costs averaged €1591 per ton in the first ten months this year.  The main importer of styrene monomer into Poland is Synthos which was fined in November by the European Commission for cartel arrangements for styrene purchases between 2016 and 2018. 

Styrene imports into the Czech Republic saw a large drop in 2022, falling from 57,195 tons in January to October 2021 to 13,407 tons.  At the same exports of styrene monomer from the Czech Republic increased from 1,019 tons in 2021 to 7,690 tons in January to October 2022. 

The emergence of exports since August 2022 is largely connected with lower rubber production at Kralupy. In September Synthos stated that it was reducing its production of ESBR at Kralupy and Oswiecim due to high energy costs.

In Hungary imports of styrene monomer totalled 72,318 tons in the period January to September 2022 against 76,512 tons in the same period in 2021.  Italy supplied 66,410 tons this year which is directed by Versalis to its polystyrene plant in Hungary, down from 73,280 tons in January to September 2021.   

Polish polyolefin trade Jan-Oct 2022

Poland imported 512,793 tons of polypropylene homo grade in the first ten months in 2022 for a total value of €893.118 million.  Russia provided 52,203 tons for €76.920 million, which was exceeded by Germany with 115.096 tons for €206,696.  Imports from Russia were last undertaken in July following the imposition of EU sanctions.  In 2021 Poland imported 155,805 tons of polypropylene homo grade from Russia for a total grade €198.656 million.  Shipments from Russia accounted for 21% of total Polish imports.

Homo grade PP imports into Poland dropped from 608,154 tons in January to October 2021 partly due to higher production at Plock.  Copolymer imports also fell from 275,727 tons to 249,797 tons, although price rises meant that costs rose from €459.485 million to €489.256 million.  Germany was the largest supplier of propylene copolymers to the Polish market last year transporting 70,529 tons for €135.519 million. 

Exports of polypropylene homo grade from Poland amounted to 165,909 tons in the first ten months in 2022 for €233.331 million.  The largest destination for Polish exports was Germany, taking 37,359 tons for €61.544 million. 

In the polyethylene sector imports into Poland totalled 1.117 million tons in the first ten months in 2022 against exports of 292,719 tons.  Import costs amounted to €2.012 billion in January to October 2022 against export revenues of €485.450 million.

LDPE and LLDPE comprised the largest category of imports, totalling 497,798 tons of which LLDPE amounted to 203,251 tons for €350.066 million.  Imports of LLDPE were sourced mostly from West Europe, including France, the Netherlands and Germany.  LDPE imports totalled 294,547 tons in the first ten months in 2022 for €542.342 million.

HDPE is the largest export category from Poland, shipping 197,582 tons in the first ten months in 2022 for €310.189 million.  Imports still outstripped exports though, amounting to 377,236 tons in the first ten months for €636.022 million.  Germany was the largest origin source of imports of HDPE into Poland last year and also the largest destination for exports.

Hungarian polyolefin exports Q1-Q3 2022

Hungarian exports of HDPE dropped from 196,578 tons in the first three quarters in 2022 to 151,472 tons in the same period in 2021.  LDPE exports declined from 87,867 tons to 69,632 tons.  Polyethylene exports were affected by MOL’s lengthy maintenance undertaken in Q2 and Q3 2022.  MOL reduced HDPE production at Tiszaujvaros in the first three quarters to 222,000 tons from 301,000 tons in the same period in 2021, which meant that exports dropped 68% of total production in 2021 to 65% in 2022.  

Propylene copolymer exports from Hungary dropped from 80,634 tons to 65,914 tons but homo grade PP increased from 76,410 tons to 80,887 tons. 

Czech polyethylene trade Jan-Oct 2022

Polyethylene and polypropylene values started to see some stability towards the end of 2022 with greater stability in the feedstock situation.  Weakening demand fundamentals in the Central European region also exerted a bearish pressure on prices.

Polyethylene exports from the Czech Republic totalled 346,000 tons in the first ten months in 2022 against 324,100 tons in the same period in 2021. 

Imports dropped slightly from 288,700 tons to 267,400 tons.  HDPE exports increased from 274,800 tons to 301,900 tons whilst imports remain dropped from 117,400 tons to 101,300 tons.   Export revenues rose from €462.3 million in the period January to October 2021 to €578.3 million in the same period in 2022, with HDPE revenues rising from €377.8 million to €477.2 million.   

Polypropylene exports from Orlen Unipetrol dropped from 276,298 tons in the first ten months in 2021 to 259,503 tons in January to October in 2022 whilst values rose from $401.509 million to $456.298 million.   

Butadiene trade Central Europe

In the Central European region Hungary is the only net exporter with most countries dependent on imports.  MOL’s butadiene exports dropped from 64,371 tons in the first three quarters in 2021 to 37,313 tons in the same period this year.  Exports were down mostly due to lower production at Tiszaujvaros and internal processing. 

Both Poland the Czech Republic are net importers of butadiene, with Synthos acting as the main buyer in both countries.  

Czech imports of butadiene dropped from 52,814 tons in the first eight months in 2021 to 48,329 tons in the same period in 2022.  Germany shipped 44,377 tons in January to August 2021, dropping to 41,613 tons in the same period in 2022.

Butadiene imports into Poland dropped from 103,017 tons in the first ten months in 2021 to 79,599 tons, the fall largely due to increased production at Plock.  Demand for butadiene at Oswiecim was expected to fall in September and October due reduced production by Synthos to higher production costs.  Synthos stated that it could no longer operate its ESBR production at full capacity due to unsustainable and unpredictable utility costs and was therefore reducing utilisation by around 30%.

In order to develop greater integration Synthos is working on its contract concluded with Air Liquide Engineering and Construction in 2021 in order to construct a new butadiene extraction unit at Plock with a capacity of 120,000 tpa.  Furthermore, for 2026 Synthos is building project to build a 40,000 tpa bio-butadiene plant at Oswiecim.  The project is aligned with Synthos goals to transition from the current 100% fossil-based to 100% bio-based synthetic rubber, in line with market requirements.

Central European rubber trade

After a gradual rise in synthetic rubber prices for the Central European region from the start of 2021 prices in the fourth quarter started seeing noticeable declines, partly due to feedstock factors and partly due to demand patterns.  Synthetic rubber prices dipped in December as butadiene continued to fall in price, particularly affecting styrene butadiene rubber.  Nitrile butadiene rubber was the only commodity where prices remained stable. Although synthetic rubber prices had risen above natural rubber prices for large parts of 2022, as illustrated in the graphic opposite, towards the end of the year the reverse trend was developing with natural rubber prices starting to rise.  

Prices for synthetic rubber have come under pressure or at least stopped rising despite the introduction of EU sanctions on Russia which has traditionally been an important supplier to Central Europe.  Those products affected mostly include butadiene rubber and particularly halogenated butyl rubber (HBR) where Russia has dominated most of the market share in Central Europe over the past decade.  Poland had previously depended almost exclusively on Nizhnekamskneftekhim for supplies of HBR, purchasing 10,424 tons in the first ten months from a total 10,917 tons. 

The Czech Republic has been slightly more diverse in suppliers of halogenated butyl rubber, but still imported 3,571 tons from Russia of the total 4,934 tons imported in January to October last year.  From August to October specifically the Czech Republic imported only 286 tons of HBRs, none of which came from Russia, whilst 198 tons of the total 275 tons imported by Poland came from Russia.

Imports of butadiene rubber from Russia into Poland in the first eight months totalled 19,969 tons for €35.692 million, from a total of 50,729 tons for a total of €108.722 million.   Imports from Russia for October amounted to 1,556 tons from a total of 6,209 tons, although the Russian sources should theoretically not be present.  Butadiene rubber sources are far more diverse than halogenated butyl rubber as it is a much larger market by volume.    

The Czech Republic imported a total of 25,603 tons of butadiene rubber in the period January to October 2022 for a total of €63.184 million, of which Russia supplied 10,199 tons for €19.892 million.  The Czech Republic is much larger exporter of butadiene rubber, shipping 90,795 tons in the first ten months last year for €190.200 million, up from 88.192 tons in January to October 2021 for €135.619 million.  The largest destination for Czech exports of butadiene rubber is India to where 19,261 tons was shipped in the first ten months in 2022 against 18,217 tons in the same period in 2021.

Hungary imported a total of 33,204 tons of butadiene rubber in the first nine months in 2022 for a total value of €69.805 million, of which Russia supplied 13,102 tons for €25.004 million.  Imports of halogenated rubber totalled 11,133 tons in the period January to September 2022 for a total value of €31.116 million, of which Russia supplied 9,378 tons for €25.837 million.

Whilst Poland and Hungary have traditionally purchased large volumes of halogenated butyl rubber (HBRs) from Nizhnekamskneftekhim it has also exported large volumes.  Hungary exported 8,083 tons of HBRs in the first three quarters in 2022 for €22.890 million, thus accounting for 73% of the imported volumes.  Hungarian exports were previously shipped to Germany, Italy, China, the US, etc but these trading links have now been broken. 

Although Nizhnekamskneftekhim as the sole Russian producer of HBRs is selling less product to the EU, the impact has not yet been significant on production rates.

Synthos 2023 prospects

Rising electricity and gas prices, coupled with slowing economic growth and supply constraints, could translate into declining prices in the styrene market and tighter butadiene spreads.   Although gas prices have fallen from the middle of the year and are forecast to fall further in 2023, those numbers will be at least three times higher than in 2021. 

In the first ten months in 2022 Synthos produced 225,100 tons of synthetic rubber at its Oswiecim plant against 230,200 tons in the same period in 2021.  Following the reduction in capacity utilisation at its ESBR plants, total production of synthetic rubber by Synthos in Poland dropped to 17,100 tons in October which was the lowest volume since 2017.   

The competitive position of Synthos is underpinned by an integrated production chain, which provides access to competitively priced feedstock, and self-sufficiency in electricity and steam in Poland and the Czech Republic. 

Excluding operations in Germany, Synthos sources approximately 35% of butadiene needs from its jv with Unipetrol and around half of its styrene supply from Synthos Kralupy, and Synthos Dwory. A further 19% of butadiene is supplied by PKN Orlen and the benefits of integration will increase with ongoing investment in Plock.

Polish synthetic rubber trade, Jan-Oct 2022

Imports of synthetic rubber into Poland increased in the first ten months to 307,586 tons against 295,791 tons in the same period in 2021.  Butadiene rubber imports rose from 37,856 tons to 50,810 tons and EPDM increased imports from 32,193 tons to 39,112 tons.  Import costs for synthetic rubber increased from €607.387 million to €741.361 million in January to October 2022, including an increase in butadiene rubber costs from €58.551 million to €108.722 million and EPDM costs increased from €60.063 million to €86.757 million. 

Imports of synthetic rubber from Russia dropped sharply in the second half of 2022 due to sanctions, with halogenated butyl rubber most affected.

Synthetic rubber exports from Poland totalled 250,469 tons in the period January to October 2022 for revenues of €508.235 million.  Volumes in 2022 dropped from 335,892 tons in the first ten months in 2021 for €521.484 million with prices rising from €1560 per ton to €2038 per ton.

ESBR exports amounted to 110,306 tons in the first ten months in 2022 dropping from 144,103 tons in January to October 2021.  Only 8,143 tons was exported from Poland in October after Synthos reduced operating rates at Oswiecim in response to high energy costs.  Average prices for ESBR increased in 2022 to €1982 per ton against €1496 per ton in the previous year. 

The largest destination for Polish exports is India which rose from 31,284 tons to 32,805 tons followed by Brazil which dropped from 18,536 tons to 11,522 tons whilst China reduced inward shipments from 10,426 tons to 1,666 tons.

Polish organic chemical imports Jan-Oct 2022

In the first ten months in 2022 Polish trade in organic chemicals comprised €1.907 billion for exports and €4.304 billion in imports.

The largest increase in imports of organic chemicals this year has been for methanol where volumes rose to 807,856 tons in the first ten months in 2022 from 562,252 tons in the same period in 2021. 

This significant rise was attributed directly to the war in Ukraine which has meant that Poland has been used as a transit route for Russian origin methanol for delivery to South East Europe.  Aside methanol, most imported organic chemicals in the table opposite are consumed inside Poland.

Export revenues comprise less than 50% of import costs with few product areas where Poland maintains a net export position.  PTA was one where export shipments totalled 351,374 tons in the first ten months in 2022 against 315,836 tons in the same period in 2021.

Polish aromatic chemical trade Jan-Oct 2022

In the aromatics sector phenol imports into Poland recorded a large increase in the first ten months to 87,700 tons, of which 14,106 tons came from Russia.  Supplies from Russia have however now been sanctioned by the EU and from August no deliveries were made to Poland.   In the period August to October Imports from Spain started to fill the gap left by Russian exporters.

On a quarterly basis phenol imports amounted to 21,931 tons in the third quarter against 25,575 tons in the second quarter and 26,893 tons in the first quarter.  Germany is the main supplier of phenol to the Polish market, shipping 15,252 tons in the third quarter. 

In other product areas, styrene imports amounted to 84,556 tons in the period January to October 2022 versus 90,498 tons in 2021 whilst ethylbenzene imports dropped from 112,876 tons to 89,117 tons.  Nearly all of the ethylbenzene imports come from the Czech Republic. 

Paraxylene imports into Poland totalled 34,150 tons in the first ten months last year, down from 70,771 tons in January to October 2021.  Russia’s last shipment of paraxylene to Poland took place in April, amounting to 3,251 tons and taking the total for the year to 6,905 tons.  Imports from Russia were replaced last year by inward shipments from Turkey, which amounted to 7,552 tons for the first ten months.  Overall, for the period January to October 2022 imports of paraxylene from France into Poland totalled 16,584 tons.

Caprolactam was previously exported commodity from Poland but due to increased processing has now become a marginal net importer.  In the first ten months in 2022 imports of caprolactam totalled 8,896 tons for €23.921 million, nearly all of which came from Germany.

Poland is a major exporter of benzene shipping 142,294 tons in the first ten months in 2022 against 84,157 tons in January-October 2021.  Germany and the Czech Republic were the two largest destinations for Polish exports in 2022.

Higher caprolactam prices Jan-Oct 2022

Spolana exported 31,330 tons of caprolactam from the Czech Republic in the first ten months last year against 34,769 tons in the same period in 2021.  Revenues from caprolactam exports increased from €62.308 million to €81.407 million, after average prices rose from €1792 per ton to €2612 per ton.  Italy was the largest destination for Spolana’s exports in 2022, with volumes to Germany reduced from 12,627 tons in January to October 2021 to 7,509 tons.  

Hungarian organic chemical trade 2022

Hungary exports a range of organic chemicals including propylene, isocyanates, maleic anhydride, etc, whilst imports include styrene, methanol, acrylonitrile, etc. 

Acrylonitrile imports into Hungary increased in the first nine months to 30,390 tons against 25,015 tons in the same period in 2021.  Costs increased from €43.082 million to €67.150 million.  The largest supplier of acrylonitrile to Hungary in the first three quarters last year was the Netherlands, accounting for 19,912 tons for €48.532 million.    

Aniline imports into Hungary dropped in the first three quarters in 2022 to 73,801 tons from 153,092 tons in the same period in 2021.  Imports of aniline from China amounted to 71,658 tons in the first three quarters in 2021 but long-haul imports have stopped since the start-up of BorsodChem’s new aniline plant at Berente.  Imports from BorsodChem’s Ostrava plant continue to be imported for MDI production in Hungary.

Hungarian maleic anhydride exports Q1-Q3 2022

Maleic anhydride export prices from Hungary averaged €2.281 per ton in the first three quarters in 2022 against €1.565 for the same period in 2021. 

Revenues from sales of 15,988 tons in January to September 2022 totalled €35.116 million versus 14,136 tons in the same period in 2021 for €23.148 million.  Poland was the largest consumer of Hungarian maleic anhydride which is produced at Szazhalombatta.  Continuing high costs of freight and overall logistics problems gave rise to both import and export constraints. The European market continued to experience logistics problems caused by the pandemic.

Polish chemical and polymer imports from Russia

Imports of chemicals and polymers from Russia into Poland dropped in most product areas after July-August last year following the introduction of official sanctions by the EU, self-sanctioning by companies together with resulting logistical issues.   Methanol shipments from Russia were one of the few product

areas that actually increased in the second half of 2022, with Poland increasing its role as a trading link to South East Europe.  However, methanol will come under EU sanctions from 8 January and thus direct purchases from Russia will be no longer possible.

Polish PTA sales  Jan-Oct 2022

PTA exports from Poland amounted to 351,374 tons in the first ten months in 2022 against 315,836 tons in the same period in 2021.  PTA imports into Poland dropped in the first ten months to 1,864 tons versus 37,975 tons in the same period last year.  Due to higher production at Wloclawek Poland reduced imports of PTA in the first ten months to 1,864 tons against 58,416 tons in January to October 2021. 

Average prices for Polish PTA exports amounted to €1035 per ton in the first ten months against €630 in the same period in 2021.   Germany remained the main customer for Polish PTA, taking 281,180 tons in January to October 2022 against 274,202 tons in the same period in 2021.  Lithuania was the second largest destination for PTA export shipments, taking 33,382 tons versus 21,227 tons.

Polish solvent imports, Jan-Oct 2022

Isopropanol imports rose from 9,652 tons in January-October 2021 to 9,224 tons in 2022s year, with Germany providing the largest volume of 2,387 tons.  Russia supplied 671 tons in the first four months in 2022, but similarly to some other products trading has been phased out.

Acetic acid imports into Poland amounted to 38,024 tons in the first ten months in 2022 versus 37,028 tons in the same period in 2021.  Import sources for 2022 included the UK with 13,027 tons for €15.248 million, the US with 10,118 tons for €12.332 million, and Germany with 6,487 tons for €7.817 million. 

Ethyl acetate imports declined from 19,292 tons in January to October 2021 to 12,534 tons in 2022.  Supplies were diversified between Belgium, Germany, UK and the Netherlands.  Vinyl acetate imports dropped from 16,522 tons in January to October 2021 to 14,853 tons in 2022 for costs of €31.197 million.   

Polish solvent exports, Jan-Oct 2022

Solvent exports from Poland are concentrated mostly on acetone and normal butyl acetate.  Acetone exports in the first ten months in 2022 amounted to 15,749 tons against 14,894 tons in the same period in 2021. Exports in 2022 were spread largely though Europe, including the Czech Republic, Germany, Hungary, Italy and Romania.  

N-butyl acetate export increased from 13,363 tons in January to October 2021 to 15,102 tons in the same period in 2022.  Germany was the largest destination for Polish butyl acetate exports last year, amounting to 7,970 tons in January to October followed by Italy with 3,411 tons.  N-butyl acetate is produced in Poland by Solvent Wistol at Oswiecim. 

Central European isocyanates, Jan-Oct 2022

MDI imports into the Czech Republic totalled 29,662 tons in the first ten months in 2022 against 36,374 tons in the same period in 2021.  Total costs for MDI imports dropped from €85.456 million in January to October 2021 to €81.587 million in the same period in 2022, with average prices rising from €2330 per ton to €2725.

TDI imports into Poland amounted to 62,470 tons in the period January to October 202 against 66,842 tons in the same period in 2021.  Average prices increased from €2581 per ton to €2861.

Hungary remained the largest supplier to the Polish market, shipping 30,763 tons versus 31,558 tons in January to October 2021 whilst Germany reduced shipments from 18,600 tons to 16,050 tons.  South Korea started supplying TDI to Poland in 2022, shipping 4,212 tons for €11.452 million.  Other important European markets for Hungarian TDI exports include Romania and Germany.

Although European demand is faced by recessionary trends and slowly declining feedstock costs global capacity constraints may help to sustain prices. 

MDI imports into Poland dropped from 157,567 tons in the first ten months in 2021 to 123,068 tons in the same period in 2021.  Import sources were diversified largely between Germany, the Netherlands, Hungary and Belgium.  Despite the fall in import volumes costs increased to €323.672 million against €306.666 million, increasing the average price from €2349 per ton to €2593 per ton in 2022.

In terms of price direction MDI numbers started softening towards the end of the third quarter, dropping from the peak of €2755.8 per ton in May to €2468.4 per ton in September.  For the same month September in 2021 prices had climbed to €2696.9 per ton due to post-pandemic growth but with a very different picture in 2022 prices have started to drop slightly. 

Feedstock costs are falling also but demand is key concern.  Due to this factor Covestro has paused development of a $1.5 billion MDI plant project originally intended for the US, with short-term demand expectations weakening due to slowing global GDP growth.    At the same time Covestro AG is going ahead with the construction of a new aniline plant at Antwerp.  The plant is scheduled provisionally in early 2025.  The expansion of aniline production is part of Covestro’s global MDI strategy. The aim is to strengthen the production network for MDI in view of a further increase in demand. In Brunsbüttel, Germany, Covestro already commissioned a new plant for the production of MDI using the particularly energy-efficient AdiP technology in 2020.

Central European methanol trade Jan-Oct 2022

Exports of methanol from Poland totalled 381,926 tons in the first ten months in 2022 for €164.054 million, based on an average price of €434 per ton.  This compares against 152,800 tons in the same period in 2021 for $55.179 million at an average price of €361 per ton.

The transformation in the market dynamics has been quite significant with Poland developing large market shares from virtually nothing in Slovakia, Hungary and Romania and increasing market shares in countries such as Germany, the Czech Republic and Austria.  Ukraine has also started to purchase methanol from Poland with 15,181 tons purchased in the period June to October last year.  Even if the price is higher than Russian sources Ukraine will prefer to buy from the other suppliers.  Although Poland exported a record amount in 2022 and should be able to maintain some of the new buying links in South East Europe, the EU sanctions mean that Polish traders need to seek out alternative sources.

Imports of methanol into Poland totalled 799,181 tons in the first ten months in 2022 versus 559,667 tons in the same period in 2021.   Costs totalled €178.813 million in January to October.  The average price for Polish imports comprised €373 per ton in the first ten months this year, and for Russia in particular €372 per ton.  From 8 January this year EU sanctions will apply to methanol from Russia and thus major changes are expected in the market structure in the next few months.  

Russia increased exports to Poland in the first ten months in 2022 to 623,958 tons from 368,700 tons.   Norway increased shipments from 18,497 tons to 24,537 tons.  Germany increased exports to Poland in the first ten months in 2022 to 87,956 tons from 67,166 tons in the same period last year.

Czech imports of methanol amounted to 65,123 tons in the first ten months in 2022 against 77,114 tons in the same period in 2021.  Russia accounted for 25,060 tons in January-October 2022 against 46,229 tons in the same period last year, followed by Poland which increased from 19,522 tons to 32,380 tons.  Prices per ton for methanol imports into the Czech Republic increased from €359 in the first ten months in 2021 to €471 this year. 

Hungarian imports of methanol totalled 58,298 tons in the first nine months for a total cost of €27.258 million.  Prices averaged €468 per ton in the first nine months against €328 per ton in the same period in 2021, when volumes were much higher at 89,946 tons for costs of €29.468 million.  Imports from Russia fell from 36,465 tons in the first nine months in 2021 to 10,763 tons in the same period this year. 

The drop in exports from Russia was due to war in Ukraine and the difficulties in shipping product by rail.   The disruption to rail shipments has also affected imports from Slovakia where volumes declined from 31,187 tons to 11,881 tons and the opening of a new window to the north from Poland where imports increased from 309 tons in January to September 2021 to 14,702 tons.

Future for Russian chemicals industry