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Copyright © 2016 Argus Media Ltd. All rights reserved.

Hydrocarbon Resins

The Origin of the Species


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• Argus DeWitt C5 Hydrocarbon Resin Report • Established in 1980s • The only global report of the kind

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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.


Why Hydrocarbon Resins?


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


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


Upstream Petrochemical Drivers


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%


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.


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


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


N. America Ethylene Cash Costs ¢/lb

Gas feeds are much more economically attractive for production of ethylene


Cracking Slate Trend

Ethylene cracking slate continues to lighten up, leading to a shortage of heavier molecules in the US.


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


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


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.


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


C5 Global Supply

Positive/Negative GROSS OVERSUPPLY against POOR DEMAND

1Q2016 2Q2015 3Q2015 4Q2016

Trade Flows Asia ROTW


London

Houston

Washington

New York

Portland

Calgary

Santiago

Bogota

Rio de Janeiro

Singapore

Beijing

Tokyo

Sydney

Dubai

Moscow

Astana

Kiev

Porto

Johannesburg

Riga


THANK YOU!

Vitaly Rogachevsky Vice President – C5 Monomers and Polymers

Email:

Phone:

Office:

Web:

[email protected]

713-360-7536

Houston

www.argusmedia.com

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hydrocarbon resins · c9 aromatic hcr c5 hcr non-wovens packaging polymod packaging inks road...

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