Factbox: Coronavirus and Americas petrochemicals

Companies in the US resin supply chain said they are packaging and moving goods as normal so far amid the coronavirus pandemic response, although they expect a coming shortage of empty containers to fill with export-bound material.

Ocean services from Asia and Europe declines in February and this month as China, South Korea, and other countries implemented shutdowns and other measures to combat the coronavirus spread, which reduced incoming import containers to be unloaded and then reloaded with exports. So far, that reduction has not reached a level where material is left to build up in warehouses and rail storage-in-transit yards, logistics sources said.

Factbox: Downside oil price risk remains as transportation fuels demand slumps

The US Department of Homeland Security has identified the US chemical industry and its workers as essential critical infrastructure, with a "special responsibility" to maintain work schedules and operations while following US Centers for Disease Control workforce and customer-protection guidelines in response to the growing global coronavirus pandemic. The identification ensures the sector can continue producing chemcials needed for disinfectants, plastics for food preservation, medical equipment, and staples like diapers and soap.

The pandemic response has left millions hunkering down in their homes across the globe to try to stem its spread, slashing oil and gas demand just as Russia and Saudi Arabia launched a crude price war with increased output. Both issues have affected the chemical sector, which relies on crude production for cracker feedstocks and consumer demand for end products.

Here are the latest industry developments:

NEWS

**The City of Houston and Harris County Tuesday imposed stay-at-home orders to all except those going to jobs deemed essential, to buy food, or seek medical care. Essential industries include chemical, critical manufacturing, energy, and transportation systems.

**Phillips 66 has cut back to minimum rates at its 13 refineries in the US and abroad, and is expecting first-quarter refinery utilization to be in the low to mid-80% range compared to the 90% originally forecast.

**Brazilian petrochemical industries were set to work with no restrictions among quarantine decrees issued across Brazil, especially in the Sao Paulo area -- the most critical region for the petrochemical sector. Brazil's accumulated deficit in the trade balance for chemical products fell 10% in the first two months of 2020 at $4.4 billion, according to the local chemical industry association, Abiquim.

**Brazil's largest petrochemical distributor association, Adirplast, expects the coronavirus pandemic to intensify the demand in the plastics chain in Brazil -- already up 20% for disposable products, mainly in the medical and pharmaceutical fields

**Neither ExxonMobil nor Sabic answered question about whether they would suspend construction on a new petrochemical complex near Corpus Christi, Texas, that will have a new 1.8 million mt/year cracker and two new polyethylene plants with a combined capacity of 1.25 million mt/year. An ExxonMobil spokeswoman said in a statement that the company was monitoring the situation closely in view of guidance from relevant authorities and has well-established processes in place to manage impacts related to infectious disease outbreaks. Sabic did not respond to an inquiry. Shell last week suspended construction on its $6 billion petrochemical complex in Pennsylvania in response to efforts to slow coronavirus spread.

**US isopropyl alcohol prices skyrocketed to a fresh record high Tuesday, amid increasing demand for hygiene and sanitation products in efforts to contain the coronavirus pandemic. US IPA was assessed $1,285/mt higher at $2,205/mt FOB USG and $2,265/mt DER, based on trade levels heard in the market and on stronger demand. IPA is used to make hand sanitizer.

PRICING

**US spot ethylene prices Tuesday were flat at all-time lows reached March 20. Mont Belvieu ethylene was unchanged from Monday at 10 cents/lb Mont Belvieu, the lowest level since S&P Global Platts began assessing spot ethylene in July 2004. Choctaw ethylene held at 9 cents/lb FD Choctaw.

**Upstream, non-LST ethane rose 0.875 cent to 10.125 cents/gal Tuesday, a 10% increase from Monday. US spot ethylene maintains positive margins at 10 cents/lb, but is reaching zero margin for ethane.

**US spot propylene prices were flat Tuesday, with March polymer-grade propylene at 18.625 cents/lb FD USG and refinery-grade at 10 cents/lb FD USG.

**Upstream, non-LST propane rose 2.50 cents to 25.50 cents/gal.

**US MTBE fell 5.95 cents Tuesday to an assessed value of 54.50 cents/gal FOB USG.

**US front-month methanol fell 2 cents Tuesday, the last day of March volumes trading as prompt month supply, to 74 cents/gal FOB USG.

**US benzene prices fell to 104 cents/gal DDP USG Tuesday from 105 cents cents/gal Monday.

**US spot paraxylene prices extended declines Tuesday, falling $5 to close at $520/mt FOB USG, a fresh low since S&P Global Platts began assessing the product in October 2006.

**US styrene monomer prices were flat at a historic low of $375/mt (17.01 cents/lb) FOB USG for prompt-month loading on Tuesday, down 18.5% from Friday.

**March and April FOB USG toluene each up 3 cents/gal day on day to 96 cents/gal

**March and April FOB USG mixed xylenes each fell 4 cents/gal day on day to 88 cents/gal

**USGC standard naphtha barges prices rose 7.2% on Tuesday to 27.050 cents/gal, up from 25.220 cents/gal on Monday. USGC Light straight-run naphtha prices rose 6.8% on Tuesday to 35 cents/gal from 32.75 cents/gal Monday.

**April RBOB settle at 44.37 cents/gal on the NYMEX, up 3.14 cents from Monday's all-time low.