April news from CIREC

Impact on Russian petrochemical producers from COVID-19

No reductions in production have been announced thus far, but the ongoing situation could result in reducing operating rates in May and June. SIBUR has prepared a package of anti-crisis measures. It should help the company go through a period of economic downturn caused by the coronavirus epidemic and exacerbated by an unprecedented drop in oil prices. At the start of 2020 the group had signalled investments of 126 billion roubles but will almost certainly be reduced. In addition, the company does not exclude temporary production shutdowns at individual sites, if they go into operating losses and the netback will cease to compensate for production costs.

According to preliminary estimates, at current oil prices, SIBUR EBITDA in dollar terms may decrease by 20–25% in 2020 compared to 2019. This is a much less significant drop than expected by oil and gas companies, but this forecast does not take into account a possible reduction in sales. One clear objective is to bring ZapSibNeftekhim at Tobolsk, to full capacity, as this is now one of the most efficient group plants firstly due to the availability of raw materials and secondly lower logistics costs compared to, for example, the hydrocarbon business, explains a person close to the company. The company will maintain the payment of wages from 4-30 April as usual.

In Tatarstan, Kazanorgsintez will continue production on non-working days until April 30. The company will maintain the payment of wages from 4-30 April as usual. Employees at Kazanorgsintez engaged in a continuous technological process will be involved in the previous mode, whilst workers in other units will remain at home on self-isolation. They will enter the enterprise only if necessary.

Nizhnekamskneftekhim is following similar procedures as Kazanorgsintez and will continue its produce normally for now. The personnel ensuring the continuity of the production process and employees located at a remote mode will continue to work in compliance with all sanitary and epidemiological requirements to prevent the spread of coronavirus infection. For this period, for workers from 60 years of age and older, unoccupied in the process of continuously operating production, days off in self-isolation mode are extended.

For contractors, a separate entrance has been organized. In the industrial zone, the number of shuttle buses has been increased. The canteens' work schedule has also changed to eliminate crowding. Employees of Nizhnekamskneftekhim engaged in continuous production are provided with certificates from the employer, allowing them to move freely to and from work. The issue of introducing a three-shift work schedule instead of four is being considered. Now the main task for Nizhnekamskneftekhim is to ensure a safe, continuous production cycle for the production of high-quality products.

Latest table updates

Russian methanol production and trade balances 2020

Major Russian methanol consumers by monthly purchase from producer

Russian methanol exports by destination

Russian isoprene rubber data

Russian paraxylene exports

Russian PTA imports

Russian TDI imports

Russian MDI imports

Russian acetone production and exports

Russian rubber production and market balance 2019

Russian Synthetic & Natural Rubber Market (unit-kilo tons)
	Jan-Feb 20	Jan-Feb 19
Production	266.0	264.0
Exports	140.4	177.2
Imports	30.6	35.0
Supply/Demand Balance	156.2	121.8

Russian rubber production and market balance 2019

Synthetic rubber production in Russia increased slightly in the first two months in 2020 from 264,000 tons to 266,000 tons, whilst domestic consumption rose to 156,200 tons from 121,800 tons. Whilst overall demand is on the downturn the performance in the first two months is largely due to the redirection of volume production from Togliattikaucuk to the new owners Tatneft’s tyre plants in Tatarstan. In 2019 the Kama Tyre plant was forced to reduce output due to the lack of rubber supplies from Nizhnekamskneftekhim as the result of a price dispute.

Production at Togliatti in early 2019 was managed by SIBUR, which was mostly export-oriented, but since the takeover by Tatneft in late 2019 there has been a shift in sales to the domestic market. The trend is not expected to continue though as both export and domestic markets are expected to experience lower demand for rubber this year, car sales worldwide are already drastically down for instance. Pirelli forecasts that the global passenger tyre market will drop by 19% this year which seems to represent a plausible estimate, but with so many unknown factors at present it is hard to feel confident of any market projections.

Russian petrochemical markets

Russian ethylene production rises by around 185,000 tons in first two months in 2020 posted Wednesday, April 01, 2020
Sharp rise in Russian propylene production in first two months in 2020 following start-up at ZapSibNeftekhim posted Wednesday, April 01, 2020
Russian styrene production & sales, January-February 2020 posted Wednesday, April 01, 2020
Impact of COVID-19 on Russian petrochemical producers posted Monday, April 06, 2020
Russian C4s, January-February 2020 posted Friday, April 17, 2020
Kazakh petrochemical project at Atyrau held up by equipnent delays posted Wednesday, April 15, 2020

Russian Petrochemical Prices 2020 (roubles per ton)
Product	Delivery terms	3 April	27 March	20 March

Ethylene	VFD	43200-47200	43200-47200	43200-47200
Propylene	FCA PFD	29000-30000	37500-41000	37500-41000
	FCA SFO	18000-19000	29000-30000	29000-30000
Benzene	FCA NWFD	?.?.?.	?.?.?.	?.?.?.
	FCA PFD	5000-6000	34800-35500	34800-35500
	FCA SFO	4500-5600	37000-40500	37000-40500
Styrene	FCA PFD	54000-60000	58000-66000	58000-66000
	EXW PFD	60000-65000	68 000-71000	68 000-71000
Methanol	EXW PFD	17500–21000	17500–21000	17500–21000
	FCA PFD	17800–24000	17800–24000	17800–24000
	FCA SFO	17500–21000	17500–21000	17500–21000
	CPT Ural Federal District	18000–24000	18000–24000	18000–24000
N-butanol	FCA PFD	61000-75300	61000-75300	61000-75300
	FCA SFO	41000-42000	48000-49000	48000-49000
	CPT CFD	61000-75300	61000-75300	61000-75300
Isobutanol	FCA PFD	48000-72500	48000-72500	48000-72500
	FCA SFO	?.?.?.	?.?.?.	?.?.?.
	CPT CFD	48000-72500	48000-72500	48000-72500
Toluene	FCA NWFD	54000-54600	54000-54600	53000-53600
	FCA CFD	?.?.?.	?.?.?.	?.?.?.
	FCA SFO	47000-48000	47500-48500	47500-48500
	FCA PFD	?.?.?.	?.?.?.	?.?.?.
Orthoxylene	FCA CFD	56000-58000	56000-58000	55000-55500
	FCA PFD	48000-49000	52000-52400	52000-53400
	FCA NWFD	48000-49000	55020-55600	?.?.?.
	FCA SFO	49000-49500	51000-51500	51000-51500
	CPT CFD	53000-55000	53000-55000	52000-52500
	CPT PFD	48000-49000	52000-53400	52000-53400
Phthalic anhydride	FCA CFD	79000-83000	79000-83000	79000-81000
	FCA PFD	77000-78000	77000-78000	77000-78000
	CPT CFD	79000-83000	79000-83000	79000-81000
	CPT Ural Federal District	77000-78000	77000-78000	77000-78000
Pentaerythritol	FCA CFD	119000-123000	119000-123000	119000-123000
Phenol	EXW PFD	?.?.?.		?.?.?.
	FCA PFD	28800-34700	64100-69200	64100-69200
	FCA SFO	29300-33200	66500-67700	66500-67700
	CPT CFD	33900-40000	69200-74500	69200-74500
Acetone	FCA PFD	35500-37000	35000-40000	28000-32000
Dioctyl phthalate	FCA PFD	77000-80000	77000-80000	77000-80000
MTBE	FCA PFD	39000-48000	42600-55500	49000-55500
	FCA SFO	49000-53000	55000-56000	55000-56000
	FCA SFD	48000-50000	50000-51000	50000-51000
MEG	FCA PFD	43000-50500	42000-48000	42000-48000
	CPT CFD	43000-50500	43000-48000	43000-48000
Monoethanolamine	EXW PFD	108000	102000	102000
	FCA PFD	108000-113000	103000-110000	103000-110000
Diethanolamine	EXW PFD	90000	90000	90000
	FCA PFD	93000-96000	93000-96000	93000-96000
Triethanolamine	EXW PFD	90000	90000	90000
	FCA PFD	90000-95000	90000-95000	90000-95000
Neonol AF 9-6	FCA PFD	108000-110000	108000-110000	108000-110000
Neonol AF 9-10	FCA PFD	110000-112000	110000-112000	110000-112000
Neonol AF 9-12	FCA PFD	110000-112000	110000-112000	110000-112000
Heavy pyrolysis resin	FCA ???	13500-22000	22000-27000	22000-27000