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www.icis.com 1
Welcome to ICIS
www.icis.com 2
ICIS is the world’s largest provider of petrochemical information
with significant global fertilizer and energy coverage.
Corporate Structure
35years in petrochemical
benchmarks
More than
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At ICIS, our aim is to give companies a
competitive advantage. We deliver trusted
pricing data, high-value news, analysis and
independent consulting, enabling our
customers to make better-informed
decisions for trading and planning.
ICIS: Powered by Data. Driven by Insight.
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Phenol markets in Asia
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Phenol markets in Asia How does ICIS assess pricesICIS reporting on India phenol marketThe importance of a benchmark
Agenda
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Asia – concentration of capacity, cost advantage
Source: ICIS supply and demand database
Americas
Europe
Middle East & Africa
Asia
0 1 2 3 4 5 6 7
million tonnes
Acetone
Phenol
www.icis.com 9Copyright © 2015 ICIS – Private & Confidential
China accounts for 39% for Asia’s current capacity
Unit: tonnes/year Phenol
Asia excluding China 3.86 million
China 2.51 million
Subtotal (Jan 2017) 6.37 million
2017 (CNOOC Huizhou, PetroRabigh)
470kt
2018 (Deepak Phenolics) 200kt
2019 (Zhejiang Rongsheng) 400kt
Total by 2019 7.44 million
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China leads Asia demand in 2016
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China imports on a decline 2012-2015
0.00%
20.00%
40.00%
60.00%
80.00%
100.00%
120.00%
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
2008 2009 2010 2011 2012 2013 2014 2015 2016
China phenol imports
China acetone imports
Average China Phenolplant op rate
MT
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China phenol imports versus exports
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
2011 2012 2013 2014 2015 2016
China Phenol Imports
China Phenol exports
46.00%
95.80%
2015
2016
China exports to India (% of total phenol exports)India is the top destination of China’s phenol exports
www.icis.com 13Copyright © 2015 ICIS – Private & Confidential
Asia’s excess supply affects profitability
-$300.00
-$100.00
$100.00
$300.00
$500.00
$700.00
$900.00
$0.00
$500.00
$1,000.00
$1,500.00
$2,000.00
$2,500.00
Jun-2009 Jun-2010 Jun-2011 Jun-2012 Jun-2013 Jun-2014 Jun-2015 Jun-2016
Phenol and acetone margins versus benzene and propylene
Phenol Margin (including acetone) Benzene FOB Korea Friday Close
Propylene CFR NE Asia Phenol CFR China
Acetone CFR China
Margins (USD/MT)$/tonne
www.icis.com 14Copyright © 2015 ICIS – Private & Confidential
Asia phenol/benzene spread narrows in past 4 years
-$200.00
$0.00
$200.00
$400.00
$600.00
$800.00
$1,000.00
$1,200.00
Jun-2009 Jun-2010 Jun-2011 Jun-2012 Jun-2013 Jun-2014 Jun-2015 Jun-2016
Phenol spread to Benzene (China versus India)
China Phenol-Benzene Spread India Phenol-Benzene spread
USD/MT
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Correlation between China and India prices in 2016
$500.00
$600.00
$700.00
$800.00
$900.00
$1,000.00
$1,100.00
Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16
Phenol CFR China Phenol CFR India
May: PTT starts up new plant
June: Kumho starts up new plant
Early Nov: Shell lifts FM
Sept: G20 in China, phenolimportsrise
Sept: Shell declares second FM
Feb: CCP & MPSturnaround
March: Kumho turnaround
May: Mitsubishi starts major turnaround
June: Mitsui Osaka turnaround
Oct: Mitsui Chiba turnaround
Nov: Demonetisation in India; China/Asia phenol supply returns to normal, deepseaimports rise
Aug: PTTshuts plant on waste water tank fire
Dec 2015: Shell FM in force, MPS plant runs at reduced rate Dec-April
Dec: TPCC turnaround
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Phenol outlook – key pointsPhenol supply overhang to worsen in 2017-2018 as capacity expansion continues
to outpace demand growthOverhang in China/northeast Asia supplyCyclohexanone capacity expansion in China, Japan in 2017-2018 will help to
marginally ease supply/demand imbalanceStart-up of new phenol plant in India will reduce India’s import demand and
exacerbate supply overhang Further industry consolidation may be necessary
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ICIS reporting on India phenol market
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IndiaNet phenol importerDemand is higher than the capacity from both existing plantsOver 80% of India’s phenol is imported
Deepak Phenolics plant under construction for Q1 2018 start-upTrade flow driven by ADDsIndia pays a premium for non-ADD phenol because of ADDs and higher shipping
costs (eg. China and South Korea)Existing price reference: crude oil, benzene, spot phenol deals, domestic phenol
prices (spot and producer prices)Some use of ICIS by end-users in formula pricing
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India phenol and acetone – existing and new capacity
Producer LocationPhenol Capacity
(kt/year) Acetone Capacity
(Kt/year)
Hindustan Organic Chemicals (HOCL)
Kochi (Southwest India)
42 25
SI Group India LtdNavi Mumbai (West India)
37 21
Subtotal 79 46
Deepak PhenolicsDahej, Gujarat
(west India)200 120
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India’s phenol imports overtook China’s in 2015
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
2008 2009 2010 2011 2012 2013 2014 2015 2016
China phenol imports
India Phenol Imports
Linear (China phenol imports)
Linear (India Phenol Imports)
tonnes/year
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How do we assess prices
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ICIS Phenol assessmentsThree regional reports (Europe, US, Asia Pacific)
Five Asia quotes: CFR NE Asia, CFR China, CFR SE Asia, CFR India, Ex-tank Kandla
Four domestic China quotes (Sinopec, spot prices in east and south China)
Additional information in the Asia Pacific report:Weekly average phenol/acetone plant operating rate in China
Weekly Kandla phenol inventory estimate
www.icis.com 23Copyright © 2015 ICIS – Private & Confidential
ICIS has been tracking CFR India phenol prices since 2006
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ICIS Phenol Methodology specifics
Assessment
windowThrough the week up to Friday at 1700 hours in Singapore
Cargo size1,000 tonnes. In the absence of 1,000 tonne deals, ICIS will take into
consideration 500 tonne deals
Delivery point CFR west coast India (Kandla/JNPT/Hazira)
"Normalised"Phenol subject to ADD of less than $80/tonne can be normalised to
ensure a reasonably tight range
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Correlation between CFR India and ex-tank Kandla prices
ICIS Pricing IntelligenceTrusted intelligence underpinning business decisions
ICIS price reports provide independent, objective and trusted intelligence for the global petrochemical, energy and fertilizer
markets. Available through the ICIS Dashboard, our price reports cover more than 180 commodities, and focus on pricing
trends in all major trading regions.
Put simply, ICIS provides the information you need to make better-informed business decisions.
We provide access to the latest:
Spot and contract assessments
Market commentary on trends and business developments
Transactions reported and confirmed
Plant and production news
Request for a sample report todaywww.icis.com/price-reports
www.icis.com 26
Acetone Markets
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Global and Indian Acetone Market
- Demand and Supply
- Price trends
Outlook
ICIS Methodology
Agenda
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Global acetone capacity growing ahead of demand
80
81
82
83
84
85
86
87
0
1
2
3
4
5
6
7
8
9
10
2010 2015 2016 2018 2020
%
M t
on
ne
s
Capacity Demand Operating Rate (%)
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Capacity concentrated in China
Unit: metric tonnes/year Phenol Acetone
Asia excluding China 3.86 million 2.35 million
China 2.51 million 1.52 million
Subtotal (Jan 2017) 6.37 million 3.87 million
2017 (CNOOC Huizhou,
PetroRabigh)470kt 280kt
2018 (Deepak Phenolics) 200kt 120kt
2019 (Zhejiang Rongsheng) 400kt 250kt
Total by 2019 7.44 million 4.52 million
www.icis.com 30Copyright © 2015 ICIS – Private & Confidential
China imports are declining; exports are rising
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
2011 2012 2013 2014 2015 2016
China Acetone Imports China Acetone Exports
79.40%
93.80%
2015
2016
China exports to India (% of total acetone exports)India is the top destination of China’s acetone exports
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India increasingly reliant on imports but new capacity could change the picture
0
20
40
60
80
100
120
140
160
180
2012 2013 2014 2015 2016
.00
0 t
on
ne
s
Production Imports
Source: ICIS supply & demand database
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ADDs have shaped Indian imports
South Korea24%
Singapore18%
Taiwan25%
Thailand9%
Belgium3%
Saudi Arabia8%
Others13%
India Imports 2011
South Korea23%
Singapore8%
Taiwan28%
Thailand30%
China5%
Russia6%
India Imports 2016
Source: ICIS supply & demand database
ICIS Supply and Demand DatabaseExamine the past, present and future of a product market landscape
ICIS Supply and Demand Database is a powerful data service that brings you a wealth of refining, petrochemical feedstocks,
base chemicals, intermediates and derivatives market data, giving you multiple views of the marketplace, actual market
dynamics and reliable data from 1978 up to 2030.
Fully integrated into feedstocks and downstream into derivatives, you can gain a
consistent picture of product availability and consumption.
Coverage includes:
Standard balances
Import/export and trading patterns
Consumption volumes
Capacity and production volumes
Plants and refineries
Company ownership
Request for a demowww.icis.com/supplydemand-database
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Shell Dec 2015 FM in force, MPS plant at reduced rate Dec-April
Feb: CCP & MPSturnaround
March: Kumho turnaround
May: PTT starts up new plant
May: Mitsubishi starts major turnaround
June: Mitsui Osaka turnaround
June: Kumho starts up new plant
Aug: PTT shuts plant on waste water tank fire
Sept: G20 in China, phenolimports rise
Sept: Shell declares second FM
Oct: Mitsui Chiba turnaround
Early Nov: Shell lifts FM
Nov: Demonetisation in India; China/Asia phenol supply returns to normal, deepseaimports rise
Dec: TPCC turnaround
2016 prices have trended at higher levels
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Acetone Methodology
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ICIS Acetone assessments
Four regional reports (Europe, US, Asia Pacific, India/Middle East)
Three Asia quotes: CFR China, CFR India, CFR SE Asia
Four domestic China quotes (Sinopec, spot prices in east and south China)
Additional information in the Asia Pacific report:Weekly Jiangyin port acetone inventory
Solvents Middle East/India: CFR India, CFR Middle East, Ex-tank Kandla
Strengthen your negotiation position withICIS pricing data and news on the phenoland acetone markets
Request for a sample reportwww.icis.com/price-reports
ICIS phenol, acetone and solvent pricing reportsCoverage includes:
Spot and contract prices (CFR, FOB, domestic prices)
Key trading regions – Asia, the Middle East, China and India
Ex-tank Kandla price assessment
Trades, bids, offers and contracts information
Analysis of price drivers and market developments
Market updates, breaking news and price alerts
Upstream and downstream overview
Plant production and maintenance schedules and outages
Supply, demand and tradeflow insight
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Methodology
Terms Import –CFR India
Domestic –Ex-tank Kandla
Assessment Window Through the week up to Wednesday, at 1800 hours in Singapore
At the close of business on Wednesday, at 1800 hours in Singapore
Specification Minimum purity of 99.5%
Timing Loading or delivered 4-6 weeks forward from the date of publication
From prompt to two weeks from the date of publication
Terms Up to 30-90 days from date of bill of lading 60-90 days
Cargo size 500-1000 tonnes Minimum 20 tonnes
Delivery West Coast, India Kandla
www.icis.com 39
ICIS CFR India
Low end of range –
• Advance Licence Market
- Finished product is re-exported
• Anti-Dumping Duty (ADD) above $100
• Cargoes from Europe, Singapore, Taiwan, USA
• 30% of trades
High end of range –
• Domestic market
• ADD-exempt cargoes
e.g. China, Thailand, Russia
• ADD below $100
e.g. South Korea, Taiwan
• 70% of trades
www.icis.com 40
ICIS CFR India
Company ADD applicable ($/tonne)
Sold to: ADD to be added? Assessment
European-origin 277.85 Advance licence market No Low end of the range
Mitsui Phenol Singapore via Sumitomo Singapore
147.1 Advance licence market No Low end of the range
Mitsui Phenol Singapore via Mitsui Bussan
158.1 Advance licence market No Low end of the range
Taiwan Prosperity Chem Corp (TPCC)
205.05 Advance licence market No Low end of the range
Taiwan Formosa 86.1 Domestic market Yes High end of rangeS Korea LG Chem
S Korea Kumho P&B79.75 Domestic market Yes High end of range
China Chang Chun 0 Domestic market No ADD High end of rangeThailand PTT 0 Domestic market No ADD High end of range
Russian-origin 0 Domestic market No ADD High end of range
ICIS price reports provide independent, objective and trusted intelligence for the global petrochemical, energy and fertilizer markets.
Available through the ICIS Dashboard, our price reports cover more than 180 commodities, and focus on pricing trends in all major trading regions.
ICIS Pricing Intelligence
We provide access to the latest:
Spot and contract assessments
Market commentary on trends and business developments
Transactions reported and confirmed
Plant and production news
ICIS Supply and Demand Database is a powerful data service that brings you a wealth of refining, petrochemical feedstocks, base chemicals, intermediates and derivatives market data, giving you multiple views of the marketplace, actual market dynamics and reliable data from 1978 up to 2030.
Request a demowww.icis.com/supplydemand-database
Coverage includes:
Standard balances
Import/export and trading patterns
Consumption volumes
Capacity and production volumes
Plants and refineries
Company ownership
Request for a sample reportwww.icis.com/price-reports
Trusted intelligence underpinning business decisions
ICIS Supply and Demand DatabaseExamine the past, present and future of a product market landscape
ICISNewsBreaking news and analysis from across the global petrochemical markets
ICIS news editors around the world are reporting the breaking news stories that impact chemical markets, influence commodity prices, and affect your daily business decisions.
Be the first to find out market moves, deals, announcements, new data and analysis – all via one online subscription.
Request a free trialwww.icis.com/request-trial-news
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THANK YOU
Malini Hariharan
+91 9820629926
Angeline Soh
+65 6780 4354
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