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Hydrocarbon Resins
The Origin of the Species
Copyright © 2016 Argus Media Ltd. All rights reserved.
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C5 and Hydrocarbon Resins Newsletter
• Provides essential information on supply and demand fundamentals, trade flows and industry news of global C5 monomers and polymers, as well as complementary and competitive products.
• Markets Covered ◦ Resin formers, isoprene monomer and
polyisoprene, DCPD, piperylenes, tackifying resins, crude oil, natural gas, ethylene and polyethylene, EVA and polypropylene, butadiene and SBR
• Key Features ◦ Market and price analysis, including
overview of the Asia Pacific, Europe and North American markets
◦ Market moving news ◦ US trade data for pertinent categories
• Value-Added ◦ Indispensable resource for marketers
and consumers of C5 monomers, polymers, as well as downstream users of articles manufactured with C5 derivatives.
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Why Hydrocarbon Resins?
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The Rosin and HCR competitive space
Pulls on hydrocarbon and natural resins create price/supply dynamics
Some applications very flexible, others much less
Some markets have significantly higher affordability
Inks
Hydrocarbon Resins
Rosin/HCR Hybrids
Labels Roadmarking
Tapes Rosin
Hot Melt Adhesives
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Hydrocarbon Resins vs Rosin Resins
C5 Piperylenes
(PIPs)
C9 Monomers
DCPD
C9
Mixed C5’s
Hydrogenated
HCR
C9 Aromatic
HCR
C5 HCR
Non-wovens
Packaging
Polymod
Packaging
Inks
Road marking
Tapes &
Labels
Road marking
Monomers Polymers/HCR Resins End-use Markets
Rosin
Opportunity
Rosin
Opportunity
Possible
Rosin
Opportunity
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Upstream Petrochemical Drivers
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Barrel of Oil
Commodities Plastics
Rubber Products
7%
93%
Intermediates Isoprene DCPD
Piperylenes Styrene VAM Isocyanates Acrylates Polyols
30% (2.1%) 70%
Motor Gasoline, Lubes and Heating
Fuels
Naphtha Gas Oil
Ethylene Propylene Butadiene
Benzene Toluene Xylene
C9 ARO, CC5
Specialty Products Plastics,
Rubber Products
Specialty Raw Materials C5, C9 and DCPD resins,
BCP, EVA
20% (0.4%) 80%
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It Is All Relative – Tackifying Resins
Isoprene and all hydrocarbon tackifying resins are roughly 1.3mn tons each, or roughly 100 times less than ethylene market.
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Byproducts of the Ethylene Cracking Process
Ethylene
Byproducts of
Ethylene Production
utilizing Liquid Feeds
Critical to
Resins, Inks, BCP’s
Steam
Cracking
Process
Propylene
Cyclopentadiene
Aromatics
Isoprene
Butadiene
Drive Cracking Slate
Gas
Feed
Liquid
Feed
Benzene
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Feed Pathway
• Can only get tackifier resin feeds from Naphtha and gas oil
• Isoprene is the key driver for recovery of Crude C5 stream
Ethylene Cracker
Crude C5’s
DCPD
Piperylenes
Isoprene
Unsaturated Polyester Resin Hydrogenated Waterwhite
Tackifers Ink Resins
C5 Tackifier Resins
SIS Polyisoprene Rubber
Supply Chain is Dependent on Ethylene Feeds for Crude Streams (C9 ARO or CC5)
C9 Aromatic Resin Oil
Hydrogenated Tackifers;
Ink Resins; C9 Resins
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N. America Ethylene Cash Costs ¢/lb
Gas feeds are much more economically attractive for production of ethylene
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Cracking Slate Trend
Ethylene cracking slate continues to lighten up, leading to a shortage of heavier molecules in the US.
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C5 Demand Drivers
Natural Rubber
(NR) 12 MT
Isoprene Rubber
(IR) <1 MT
DCPD (DCPD)
Piperylenes (PIPs)
Isoprene (IPM) +1MT
NR and IR are generally said to be analogs, so IR demand is directly affected by NR market
Coproducts of IPM
IPM also goes into making of SIS, but volume is small and low growth – not a factor
Crude C5 Feedstream
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It Is All Relative – Rubber Demand
• Synthetic rubber (SR) growth has a higher growth potential
• SR growth driven by performance attributes
• Isoprene rubber, a synthetic rubber, is a small proportion of entire SR demand,
<1M tons out of ~14.5M tons in 2015
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Isoprene Monomer Prices
Isoprene monomer requires further costly processing to be converted to polyisoprene rubber. Cannot compete with natural rubber which is used as is.
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Isoprene (and DCPD and PIPs) Capacity Overbuild
5-10 kt/yr
50-60 kt/yr
10-20 kt/yr
Asia (mostly China)
China overbuilds
IPM/IR Capacity
Taiwan Adds 60 kta IPM Capacity in
2015
Korea Started up new 25 kta unit Q2 2016 with another
ready in Q4
Braskem considers stopping IPM
production in 2016
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C5 Global Supply
Positive/Negative GROSS OVERSUPPLY against POOR DEMAND
1Q2016 2Q2015 3Q2015 4Q2016
Trade Flows Asia ROTW
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London
Houston
Washington
New York
Portland
Calgary
Santiago
Bogota
Rio de Janeiro
Singapore
Beijing
Tokyo
Sydney
Dubai
Moscow
Astana
Kiev
Porto
Johannesburg
Riga
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THANK YOU!
Vitaly Rogachevsky Vice President – C5 Monomers and Polymers
Email:
Phone:
Office:
Web:
713-360-7536
Houston
www.argusmedia.com
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