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Egyptian buyers unhappy with new protection fees on homo-PP imports

The Egyptian government implemented a protection fee of 15% on all homo-PP imports effective for 200 days from June 5 to December 22, 2012, as per ChemOrbis. Egyptian PP producer EPPC pointed to strong competition from lower priced import cargoes as support for the new measures, but buyers have expressed anger regarding the new protection measures, which they feel to be unjustified. Egypt?s Chamber of Industry has also protested the new protection fees, arguing that the new measures will hamper the country?s export trade in finished plastic products while adding that EPPC?s production is not large enough to satisfy the market?s needs. EPPC is the only PP producer currently active in the country as OPC?s 160,000 tpa PP plant has been offline since November 2011.
?We had purchased some import PP cargoes before the implementation of the new fees and will need to pay the tax when our cargoes arrive. We are hopeful that our suppliers will agree to some discounts on their prices to help us cope with the new taxes,? a trader based in Cairo reported. An Egyptian distributor reported seeing firmer prices after the implementation of the protection fee, saying, ?The offers we received for locally-held materials jumped EGP200-300/ton (US$33-50/ton) at the end of last week after the protection fees went into effect. We expect to see higher prices in the days ahead as the new measures are likely to result in tighter supply for PP.? A converter manufacturing injection products told ChemOrbis, ?We feel that the new protection fees will be harmful for the market and are not happy with the new regulations. We can substitute HDPE injection for homo-PP injection in our manufacturing process if the new taxes push PP injection to uncompetitive levels.? A plastic pipe manufacturer stated, ?We are not happy with the new protection fees and are angry that a local producer has pressured the government to implement this measure. We had previously purchased some import PP from a Middle Eastern producer but we are now thinking of cancelling our orders. We will try to wait out this new measure in the hope that it will not be renewed as we can operate our plant for around 200 days without sourcing any additional PP cargoes.? Another converter added, ?We have some material sitting at the port but we are not willing to clear this material through customs following the implementation of the new tax. We have filed a complaint with the authorities as we feel that there is no rational reason to apply protection fees as EPPC had been offering below the prevailing import levels before the tax was implemented.?

Natpet in JV with Schulman to produce PP compounds

National Petrochemical Industrial Company (Natpet), a subsidiary of Alujain Corp has entered into a 50:50 joint venture agreement with A Schulman of the US to produce polypropylene compounds. Likely to be named Natpet-Schulman Engineering Plastic Compounds, the plant is likely to locate in Yanbu and expected to begin production by the end of calendar-year 2014. A Schulman’s initial equity investment in the relationship is approximately EUR 11 mln (US$14 mln).
Initial project costs, including construction of the facility, infrastructure needs as well as working capital requirements are approximately EUR 55 mln (US$70 mln) based on current exchange rates. Beyond the initial equity investment by the partners, the joint venture intends to take advantage of various low-interest loan options provided by the Saudi Industrial Development Fund and other lending institutions.
The joint venture’s new plant will enable A Schulman and Natpet to serve a broad range of customers in the Middle East, Africa and India to capitalize on the growing demand for durable goods and transportation products. All sales outside of these regions will be sold directly through A Schulman. In addition to the joint agreement, Natpet also agreed to enter into a distribution agreement, where A Schulman will, effective immediately, distribute polypropylene resins for Natpet in Europe to specified customer segments. ?Several aspects of this deal will accelerate A Schulman’s expansion and visibility in its priority growth markets of Africa, India and the Middle East while better serving our existing global customers with high-quality polypropylene compounds,? said Bernard Rzepka, general manager and chief operating officer of A Schulman, EMEA. ?This joint venture furthers Natpet’s vertical integration plan. It is a crucial enabler of creating further downstream projects by providing the key ingredients to manufacture auto and appliance parts in the Kingdom,? said Marwan Nusair, president of Alujain.

Odisha expedites establishment of plastic, polymer & allied cluster

Odisha state government has put a proposed plastic, polymer and allied cluster in Baleswar on a first track basis. To be built with an investment of Rs 82 crore, it is targeted to be commissioned by end of December 2012, on the outskirts of Baleswar town involving three areas such as Ganeswarpur, Somnathpur and Balgopalpur with the initiatives of IDCO.
A Special Purpose Vehicle (SPV) has been formed with representatives from the Government of India, the Government of Odisha and the North Odisha Chamber of Commerce and Industries (NOCCI) to ground the project. The total budget of the project is estimated at Rs 82 crore, which will be shared by financial grants from the Central Government, the State Government, contribution from industries and term loan. The project has been planned with two main components such as an Integrated Logistic Hub and a Common Facility Hub. The Integrated Logistic Hub will have a warehouse over 33,790 sq feet, truck parking with commercial area over 9,000 sq feet and railway sidings over one km. The Common Facility Hub will have facilities like a machine room over 14,000 sq feet, testing and a training centre over 9,500 sq feet, an exposition centre, a trade centre over 26, 900 sq feet, an auditorium with 6,450 sq feet, an executive hostel of 18,750 sq feet, a convention hall and a craft village over 13,450 sq feet. The cluster will have external linkages for water supply from river Budhabalanga for which a budget estimate of Rs 14 crore has been made. Construction of a bypass road to the cluster has been taken up with budget estimate of Rs 5.43 crore, which is expected to be completed by June 2012.

World’s largest plastic pipe maker to expand production to meet demand in North USA, Canada

JM Eagle, the world’s largest manufacturer of plastic pipe, is expanding production of solid-wall high-density polyethylene at two of its plants to meet demand in northern U.S. and Canadian markets. JM Eagle, the world’s largest manufacturer of plastic pipe, is expanding production of solid-wall high-density polyethylene at two of its plants to meet demand in northern U.S. and Canadian markets. Converting its Sunnyside, Wash., plant from PVC to PE production and boosting the number of PE lines at its Meadville, Pa., plant, the company aims to better serve the customers seeking products for water and sewer, as well as oil and gas gathering. The Sunnyside plant will also produce PE pipe for irrigation and both plants will produce products for power and communication application.
“JM Eagle looks forward to better serving customers in the water and gas markets in the northern part of the country, as well as in Canada,” said Dan O’Connor, JM Eagle vice president of PE sales. “This expansion gives JM Eagle a stronger footprint in PE production and distribution nationwide.”
Production on PE water pipe up to 36 inches in diameter and gas pipe is expected to begin mid- July at both plants, and all lines will be complete by September. The company also plans to manufacture up to 63-inch-diameter water pipe in the future, and is developing PE water pipe in even larger diameters.

BASF conducts pilot project to promote composting of organic waste in Pune

On the occasion of World Environment Day, BASF, with the support of the Pune Municipal Corporation, announced the launch of its pilot composting project. The project aims at promoting composting of source-separated organic waste in certified compostable and fully biodegradable bags. ?Through this project we wish to promote composting as the most effective and efficient method for organic waste management. Further, the launch of this joint project in conjunction with World Environment Day aptly exemplifies the theme ?Green Economy: Does it include you?? as it serves to demonstrate how a community can contribute to and benefit from a sustainable future,? said Dr. Tobias Haber, Head, Specialty Plastics Asia Pacific, BASF.
As part of the project launch, composting awareness booths were stationed in two residential complexes in Pune. Certified compostable and fully biodegradable bags made of BASF?s Ecovio were distributed to residents, to source-separate organic waste. The compostable bags made of Ecovio with source separated organic waste were collected and transported to an industrial composting site the next day. Speaking about this initiative, Mr. Prasad Chandran, Chairman, BASF Companies in India & Head South Asia said, ?BASF is committed to creating chemistry for a sustainable future. Through this pilot project, we aim to showcase our efforts and contribution in the biodegradable plastics segment to protect the environment and reduce greenhouse emissions. It is a privilege to partner Pune Municipal Corporation towards promoting a green initiative on the special occasion of World Environment Day.?
Together with BASF, we are excited to explore the potential for composting of source-separated organic waste as a sustainable alternative to landfilling. Composting of organic waste will significantly reduce greenhouse gas emissions. Additionally, the compost produced is a marketable commodity that can be returned to the soil to improve soil quality, reduce fertilizer use and serve as a cost-effective alternative for landscaping?, remarked Mr. Suresh Jagtap, Joint Commissioner, Pune Municipal Corporation. Landfilling of organic matter is environmentally detrimental as it generates methane, a greenhouse gas that is 23 times more potent than carbon dioxide. As organic waste has a high water content, incineration is also not a suitable alternative as it requires significant amounts of energy and results in higher emissions of carbon dioxide.
As the global market leader in the area of biodegradable polymers, BASF?s solutions include compostable and fully biodegradable shopping and waste bags made of Ecoflex® and Ecovio (a compound of Ecoflex and polylactic acid). Such bags ensure that source-separated organic waste can be sent directly to industrial composting sites to be processed and converted into high-quality compost without having to separate the bags from waste. As such, industrial composting with compostable and fully biodegradable bags is the most efficient and effective waste management option for organic waste. The high water content in organic waste also makes it difficult to collect and transport it in paper bags. Waste bags made of biodegradable, compostable plastic on the other hand make collection of organic waste more hygienic as they are tear-resistant and provide a barrier to odors.

New catalyst developed for PP production, creating the strongest version of the plastic

A new catalyst for the polypropylene production process, ultimately producing the strongest version of the plastic that has been created to date, has been developed by Prof. Kol and his team of researchers. “Everyone is using the same building blocks, so the key is to use different machinery,” he explains. With their catalyst, the researchers have produced the most accurate or “regular” polypropylene ever made, reaching the highest melting point to date. Moshe Kol, professor of chemistry at the Tel Aviv University (TAU) says that this could have a long-term impact on many industries.
Prof. Kol believes that the answer could lie in the catalysts, the chemicals that enable their production. Plastics consist of very long chains called polymers, made of simple building blocks assembled in a repeating pattern. Polymerization catalysts are responsible for connecting these building blocks and create a polymer chain. The better the catalyst, the more orderly and well-defined the chain. This leads to a plastic with a higher melting point and greater strength and durability. This is why the catalyst is a crucial part of the plastic production process.
“Everyone is using the same building blocks, so the key is to use different machinery,” he explains. With their catalyst, the researchers have produced the most accurate or “regular” polypropylene ever made, reaching the highest melting point to date.

Coke, Ford, Nike, Heinz, P&G come together to develop and use plant-based PET

Several leading global brands have joined hands to shift to plant based feedstock for packaging as crude oil prices continue to sky rocket. Coca-Cola Co., Ford Motor Co., H.J. Heinz Co., Nike Inc. and Procter & Gamble have come together to boost the development of 100% plant-based polyethylene terephthalate (PET) in their products including bottles, apparel, footwear, automotive fabrics and carpets. The companies have formed the Plant PET Technology Collaborative (PTC) in order to evolve a material that is partially made from plants to one made entirely from plant. The collaborative aims to drive the development of common methodologies and standards for the use of plant-based plastic including life-cycle analysis and universal terminology, which in turn will be promoted by the brands with and used by both PTC and non-PTC members globally.

PET prices post steep declines in China, SEAsia

Players in China and Southeast Asia have reported significant decreases in PET prices over the past week, with players attributing the decline to significant losses in spot prices for PTA and MEG feedstock, as per ChemOrbis. Buying interest is said to be limited as converters are complaining of slower than expected demand ahead of the summer season while adding that they are hesitant to purchase in large amounts owing to the uncertain outlook on the market direction. ?We reduced our export prices by US$100/ton this week while also cutting our prices to the local market by CNY700/ton (US$110/ton),? reported a source from a Chinese producer. ?Chinese origins remain more competitive than Korean origins but we still had to concede to some additional discounts of around US$10/ton to conclude deals,? the source added. ?PET prices moved lower this week and we believe they will continue to soften over the near term due to lackluster downstream demand. In addition, sufficient local supplies are also maintaining downward pressure on the market,? reported a converter manufacturing plastic soft drink bottles. ?We reduced our prices to the local market by CNY500/ton (US$78/ton) on the week. We had been planning to replenish our stocks last week, but for now we are maintaining our inventory at low levels,? a Chinese distributor reported. A source at a Chinese producer said, ?We lowered our export prices by US$100/ton this week while cutting our local prices by CNY500/ton (US$78/ton). Based on lackluster demand and sufficient supply levels, we expect to see additional price reductions next week.?
Players in Southeast Asia also reported seeing noticeable reductions in PET prices influenced no doubt by the falling Chinese offers, which are now duty free in the region as of this year, says ChemOrbis. ?We received an import offer for Chinese PET at prices US$100/ton lower than last week. We had been thinking of replenishing some stocks in the previous week but are happy that we did not ultimately purchase material,? reported a distributor in Thailand. A converter in Vietnam commented, ?PET prices are on a downward trend for now and we are waiting to see another US$100/ton reduction in import prices before purchasing.?
Another PET converter in Malaysia stated that they purchased some locally-held Chinese material for testing purposes this week. ?We also purchased a small amount of material from our regular sources in order to maintain good relations with our suppliers,? the buyer added.

First post-consumer recycled resins approved to manufacture food contact products in Canada

NextLife ?, the global leader of sustainable plastic resins, announced that the company’s recycled polypropylene (PP) and recycled polystyrene (PS) resins have received clearance from Health Canada for use in manufacture of thermoformed or injection molded articles for contact with food. This marks the first time that any post-consumer recycled resins have received approval in Canada for use in food products. NextLife resins, which are approved for up to 100 percent recycled content, have comparable performance qualities to virgin PP and PS and have wide consumer applications. “We are extremely pleased to be the first company to receive clearance for post-consumer recycled resins to be used in the manufacture of food contact products in Canada,” said Ronald Whaley, CEO of NextLife. “This expands the target market for our resins and demonstrates the success of our growth strategy which is partly based on securing approvals for our resins in different markets around the globe as we have in the U.S. and now Canada.”
NextLife recycled PP and recycled PS resins also meet U.S. Food and Drug Administration (FDA) clearance for up to 100 percent recycled content in thermoformed or injection molded articles for contact with non-alcoholic food.

Plan panel proposes duty changes for petrochem industry

The Planning Commission has proposed a slew of changes in the prevalent duty structure for the petrochemical industry for the new Plan period (2012-17). To begin with, it has urged the central government to establish single national level value-added tax (VAT)/ goods and services tax (GST) on plastic and articles of states at a uniform four per cent. This could include prime petrochemical feedstock, naphtha and natural gas, as per Business Standard.
Besides, the Commission, in a report on the industry for the new plan period, has proposed duty in an increasing trend for the petrochemical sector, starting with feedstock (naphtha and liquefied natural gas) at zero per cent, intermediates (ethylene, propylene and benzene) at two per cent, primary petrochemicals (polymers and bulk chemicals) at five per cent and various semi specialty or value-added products at 10%. For capital goods used by the industry, duty should be eliminated, down from 10% now. Currently, along with feedstock, intermediates and primary petrochemicals are charged at 5%, while various semi-specialty or value-added products are charged 7.5%.
India?s import duty structure provides zero tariff protection for key petrochemicals, naphtha, natural gas and propane besides products like ethylene, propylene, benzene and butadiene. With a preferential duty structure with countries that have signed free trade agreements with India, the tariff protection is even negative in India. On the other hand, other countries maintain a tariff differential of at least 5.5%. In terms of domestic taxes, polymers are charged VAT of 4-8.8% across states, central sales tax (CST) of 2%, excise of 10% and customs duty of 5%. VAT is the current state-level tax imposed on sale of any article, whereas GST includes all possible taxes ? excise, service tax, etc ? in the proposed new GST regime. The panel is of the view that natural gas should be included under the ?declared goods? category under the CST and be taxed uniformly at four per cent across states. Sales tax on natural gas currently varies across states. According to the panel, India has very low import duty of five per cent on polymers and other petrochemicals, compared with most Southeast Asian countries, where customs duty varies between five to 30%.
t is ironic that India is a net exporter of naphtha, the basic feedstock of the industry and at the same time naphtha is heavily imported for the downstream petrochemicals industry, the report said.