Issue: CPMA/0012/2018 BUZZa modern greenfield refinery. Having successfully mopped up Rs 3.35...
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Chief Secretary Anil Chandra Punetha has said that the State government is considering the proposal to set up a mega petrochemical project in the Special Economic Zone of Kakinada. Chairing the State Investment Promotion Committee (SIPC) meeting at the Interim Government Complex in Velagapudi on Friday, Punetha discussed over the petrochemical project. The concerned officials said that TCG Refineries Limited has come forward to take up the project along with Haldia Petrochemicals Limited. With the edge proffered by its R&D centre, Indian Oil Corporation Ltd (IOC), the over-$70-billion public sector oil giant, is transitioning from an adopter to provider of indigenously developed refinery technology to the world. Its R&D now has the capability to supply about 90 per cent of the technology needed to set up a modern greenfield refinery. Having successfully mopped up Rs 3.35 billion through its maiden issuance of listed non-convertible debentures (NCDs), ONGC Petro additions Limited (OPaL) is looking to raise another Rs 26.5 billion in one year. A joint venture of ONGC Ltd. & GAIL (India) Limited and co-promoted by GSPC, OPaL is planning to raise a total Rs 30 billion through multiple tranches for retiring short term loans and partly funding its capital expenditure. Reliance Industries said it has raised Rs 3,000 crore through a privately placed debenture issue. The unsecured, non-convertible redeemable debentures offered 8.95 percent return with a 10-year maturity, the company said in a regulatory filing. Predicting oil prices is testing the skills of all experts globally. Oil prices are giving surprises to all. For example after a peak of US $101 in Jun 2014, prices bottomed out to US $ 35 per barrel in Jan 2016. It again gradually improved to US $ 86 in Oct 2018 to drop again to US $ 51 in Dec 2018. Presently hovering around US $ 58. Now the predictions are that 2019 will end with crude prices at around US $ 60.0. Only time will tell which direction the crude oil prices will go looking at geo political uncertainties and megatrends shaping the future. According to one report, IC engine automobile sales have already peaked in 2018 and unlikely to surpass this number in future. Global Electric cars are likely to grow by 1.6 million units in 2019 taking global sales to 96.6 Million units. There is complex interplay of events such as US led trade wars, Brexit, embargo in Iran and New emission targets in Europe. All these have impact on oil prices and in turn on Petrochemicals feedstock prices. One needs to be more agile to adjust to ever changing business dynamics and rework of future strategies on a continuous basis rather than making annual plans. Even oil demand for transport is expected to peak around 2025 and gradually decline. Petrochemical feedstock demand for oil on the other hand will increase and will improve its share in overall oil demand from present 14%. Commentary for the month PETCHEM BUZZ Issue: CPMA/0012/2018 December 2018 Monthly Newsletter from 1 | December 2018 India’s industrial output grew at an 11-month high of 8.1 per cent in October mainly on the back of mining, power and manufacturing sectors coupled with higher off-take of capital as well as consumer durable goods. Govt. brings in 3 Think Tanks to strategise for RCEP talks The government has roped in three of India’s premier think tanks to prepare a road map for negotiating the Regional Comprehensive Economic Partnership (RCEP) trade agreement expected to conclude next year. Indian Institute of Management, Bangalore, Indian Council for Research on International Economic Relations (ICRIER) and the Centre for Regional Trade, an autonomous think tank under the Department of Commerce, will discuss India’s strategy in goods, services and investment negotiations with all stakeholders including other ministries concerned, ahead of the trade negotiations. Opec +agrees to cut output by 1.2mn bpd. The Organization of the Petroleum Exporting Countries and its Russia-led allies referred to as ‘’OPEC” agreed to slash production by a combined 1.2 million barrels per day from 2019, larger than the minimum 1 million bpd that the market had expected, despite pressure from US President Donald Trump to reduce the price of crude. Almost forty years after gas was first ‘cracked’ in the Gulf Cooperation Council, the region’s petrochemical industry is not only moving away from gas, it is looking for pastures away from region itself.Senior industry leaders from the region cite the shift to heavier feedstocks and the construction of new facilities in places such as the US, China and India, as key to their strategy of remaining competitive. The Asian petrochemicals market is likely to remain steady with a number of market participants engaged in term contract negotiations this week, coupled with upstream Industry Snippets continued on page 2 Member Companies in the News CPMA
Transcript of Issue: CPMA/0012/2018 BUZZa modern greenfield refinery. Having successfully mopped up Rs 3.35...
Chief Secretary Anil Chandra Punetha has said that the State government is considering the proposal to set up a mega petrochemical project in the Special Economic Zone of Kakinada. Chairing the State Investment Promotion Committee (SIPC) meeting at the Interim Government Complex in Velagapudi on Friday, Punetha discussed over the petrochemical project. The concerned officials said that TCG Refineries Limited has come forward to take up the project along with Haldia Petrochemicals Limited.
With the edge proffered by its R&D centre, Indian Oil Corporation Ltd (IOC), the over-$70-billion public sector oil giant, is transitioning from an adopter to provider of indigenously developed refinery technology to the world. Its R&D now has the capability to supply about 90 per
cent of the technology needed to set up a modern greenfield refinery.
Having successfully mopped up Rs 3.35 billion through its maiden issuance of listed non-convertible debentures (NCDs), ONGC Petro additions Limited (OPaL) is looking to
raise another Rs 26.5 billion in one year. A joint venture of ONGC Ltd. & GAIL (India) Limited and co-promoted by GSPC, OPaL is planning to raise a total Rs 30 billion through multiple tranches for retiring short term loans and partly funding its capital expenditure.
Reliance Industries said it has raised Rs 3,000 crore through a privately placed debenture issue. The unsecured, non-convertible redeemable debentures offered 8.95 percent return with a 10-year maturity, the company said in a regulatory filing.
Predicting oil prices is testing the skills of all experts globally. Oil prices are giving surprises to all. For example after a peak of US $101 in Jun 2014, prices bottomed out to US $ 35 per barrel in Jan 2016. It again gradually improved to US $ 86 in Oct 2018 to drop again to US $ 51 in Dec 2018. Presently hovering around US $ 58. Now the predictions are that 2019 will end with crude prices at around US $ 60.0. Only time will tell which direction the crude oil prices will go looking at geo political uncertainties and megatrends shaping the future.
According to one report, IC engine automobile sales have already peaked in 2018 and unlikely to surpass this number in future. Global Electric cars are likely to grow by 1.6 million units in 2019 taking global sales to 96.6 Million units.
There is complex interplay of events such as US led trade wars, Brexit, embargo in Iran and New emission targets in Europe. All these have impact on oil prices and in turn on Petrochemicals feedstock prices. One needs to be more agile to adjust to ever changing business dynamics and rework of future strategies on a continuous basis rather than making annual plans.
Even oil demand for transport is expected to peak around 2025 and gradually decline. Petrochemical feedstock demand for oil on the other hand will increase and will improve its share in overall oil demand from present 14%.
Commentary for the month
PET
CH
EM B
UZZ
Issue: CPMA/0012/2018
December 2018
Monthly Newsletter from
1 | December 2018
India’s industrial output grew at an 11-month high of 8.1 per cent in October mainly on the back of mining, power and manufacturing sectors coupled with higher off-take of capital as well as consumer durable goods.
Govt. brings in 3 Think Tanks to strategise for RCEP talks
The government has roped in three of India’s premier think tanks to prepare a road map for negotiating the Regional Comprehensive Economic Partnership (RCEP) trade agreement expected to conclude next year.
Indian Institute of Management, Bangalore, Indian Council for Research on International Economic Relations (ICRIER) and the Centre for Regional Trade, an autonomous think tank under the Department of Commerce, will discuss India’s strategy in goods, services and investment negotiations with all stakeholders including other ministries concerned, ahead of the trade negotiations.
Opec +agrees to cut output by 1.2mn bpd.
The Organization of the Petroleum Exporting Countries and its Russia-led allies referred to as ‘’OPEC” agreed to slash production by a combined 1.2 million barrels per day from 2019, larger than the minimum 1 million bpd that the market had expected, despite pressure from US President Donald Trump to reduce the price of crude.
Almost forty years after gas was first ‘cracked’ in the Gulf Cooperation Council, the region’s petrochemical industry is not only moving away from gas, it is looking for pastures away from region itself.Senior industry leaders from the region cite the shift to heavier feedstocks and the construction of new facilities in places such as the US, China and India, as key to their strategy of remaining competitive.The Asian petrochemicals market is likely to remain steady with a number of market participants engaged in term contract negotiations this week, coupled with upstream
Industry Snippets
continued on page 2
Member Companies in the News
CPMA
Upcoming Events
19-22 MARCH 2019 | SAN ANTONIO, TX
34TH ANNUAL WORLDPETROCHEMICAL CONFERENCE
2019
2 | December 2018
PETCHEM BUZZ
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Trade Statistics- Key Products
Sr. No.
Product
2017-18 2018-19 (Apr-Oct) Average monthly Imports
Imports (KT)
Exports (KT)
Imports (KT)
Exports (KT)
2017-18 (KT)
Apr-Oct 18 (KT)
% Change
1 PVC 1861 20 1143 11 155 163 5.3%
2 LLDPE+HDPE 1418 435 715 477 118 102 -13.6%
4 PP 939 552 541 373 78 77 -1.2%
5 SM 789 5 493 4 66 70 7.1%
9 PTA 408 212 400 60 34 57 68.2%
3 MEG 931 137 394 185 78 56 -27.4%
6 EDC 713 45 331 10 59 47 -20.5%
8 VCM 398 0 242 0 33 35 4.2%
7 LDPE 465 108 187 118 39 27 -31.0%
10 ABS 82 0.3 72 0.2 7 10 49.7%
11 PS 50 69 19 37 4.1 3 -34.3%
12 SAN 7 1 6 0 0.6 1 42.4%
13 EPS 3 3 1 2 0.2 0 -35.2%
Source: DGFT
** Quick Estimates PIB
Key Economic Indicators
UoM Sep End Oct End Nov End Dec End
Forex Reserves US $ Bn 401.7 393.5 392.8 393.4
Exchange rates 1 US$ 72.5 74.0 69.7 69.8
1 Euro 84.2 83.8 78.9 79.8
100 Jap Yen 63.7 65.6 61.4 63.4
1 Pound Sterling 94.5 94.6 89.0 88.9
IIP %age Prev month end 4.50% 8.1%** N.A. NA
WTI Crude Oil US$/MT 73.3 65.3 50.9 45.3
Brent Crude Oil US$/MT 83.7 75.5 57.3 50.2
Naphtha C&F SEA US$/MT 704 672 469 432
C2 C&F SEA UD$/MT 1154 1032 906 823
C3 C&F SEA US$/MT 1,075 1,070 790 855
NN To curb unrequired imports and the widening CAD and ease the pressure on the rupee, CPMA made a representation to Government who have already raised the duty on several articles of plastic for the same purpose to also consider safeguard duty on key petrochemical products.
NN CPMA members participated brainstorming Session on FTAs and RCEP organized by CII & DIPP. Key concerns were expressed by them during the session.
Government Communications
and Interactions
Industry Snippetscontinued from page 1
crude oil prices stabilizing at $60/b last week.
While China’s propylene market looks to be bearish under the prevailing weight of excess supply and lackluster demand in the Asian high density polyethylene market, Asia’s styrene monomer markets and purified terephthalic acid markets are likely to be supported by improved demand.
Taiwan’s Oriental Petrochemical (Taiwan) Co. Ltd. restarted its 1.5 million mt/year purified terephthalic acid line at Taoyuan Tuesday from a maintenance that lasted almost five weeks since end-November, a company source said
CPMA MembersChemplast Sanmar Ltd. N DCM Shriram Ltd. N DCW Ltd. N Engineers India Ltd. N Finolex Industries Ltd. N GAIL (India) Ltd. N Gujarat State Fertilizers & Chemicals Ltd. N Haldia Petrochemicals Ltd. N Hindustan Petroleum Corporation Ltd. N HPCL – Mittal Energy Ltd. N Indian Oil Corporation Ltd. N Indian Synthetic Rubber Private Limited N INEOS Styrolution India Ltd. N LG Polymers (India) Pvt. Ltd. N MCPI Pvt. Ltd. N Mangalore Refinery and Petrochemicals Ltd. N ONGC Mangalore Petrochemicals Ltd. N ONGC Petro Additions Ltd. N Reliance Industries Ltd. N Supreme Petrochem Ltd. N Tamilnadu Petroproducts Ltd.
Associate Members: Braskem SA N HPL Additives Ltd. N ICIS N Indorama Industries Ltd. N Jindal Poly Films Ltd. N SABIC India Pvt Ltd.
CHEMICALS AND PETROCHEMICALS MANUFACTURERS ASSOCIATION708, 7th floor, Kailash Building, 26 Kasturba Gandhi Marg, New Delhi – 110 001. N Telephone: 011-43612198 N Email: [email protected]
