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Extracts from Nandini Chemical Journal, Feb 2010

Solar power|Oil sands|Natural colours|Mannitol|Bitumen

Highlights of Some of the Articles
It has become difficult to predict the future scenario for Indian chemical industries with reasonable accuracy, since there appear to be lack of consensus amongst the  chemical industries in India as to what would be the appropriate direction for future growth, in tune with the India’s strength and priorities.

In the absence of announcement by the Ministry of Chemicals and Fertilisers about the  strategies and guidelines for  growth of Indian chemical industries, the chemical project promoters in India remain uncertain  about the future course of action and new projects for implementation or even fixing the capacity expansion targets in the existing operations. Every unit appears to be taking important decisions on the basis of it’s own understanding of the situation in the absence of any guidelines from the Government.
For example, jatropha bio diesel projects have not taken off in India , since the Government of India can not announce any firm subsidy policy for jatropha industry, which should have been decided on the basis of consensus, after extensive consultation with the industry. Several entrepreneurs, who have invested in jatropha industry in recent past remain uncertain and frustrated. Recently, an overseas trader said that he wanted to procure 6000 tonnes of jatropha oil from India but could not get even 100 tonnes ,as no one seem to be producing good quantity of jatropha oil, inspite of great euphoria created in India about the jatropha projects. Same is the case with regard to molasses and ethyl alcohol based projects. Several molasses and  ethyl alcohol based projects have suffered and quiet a few have closed their operations due to non availability of raw materials and price fluctuations, whereas the major segment of ethyl alcohol usage has been diverted for human consumption. There is no way for the chemical industries to know as to what would be the availability of molasses and ethyl alcohol as industrial feed stock in the coming years. Another immediate example of the absence of guidelines from the Government is the instance of  huge titanium dioxide complex proposed by Tatas in Tamil Nadu, which has to be given up recently, due to lack of clarity in government’s policy about acquisition of land for industrial projects. The net result is that the chemical industry in India appear to be operating in vacuum as far as the future plans and targets are concerned. In today’s condition, where the global chemical trade is rapidly becoming a borderless affair, the global competition is a factor that have to be carefully kept in view by any project promoters while working out the future plans. Several countries particularly China and in Middle East region are planning and implementing a number of projects amongst the cross section of chemical project opportunities, largely based on the strength of raw material availability for them  or the potential market base in their regions. This has resulted in 
oversupply scenario for several chemicals in the global market. In this scenario, the clear understanding of the policy and thinking of Government of India vis-à-vis that of governments in other countries is important for the chemical project promoters, who have to take make or buy decisions.
 The government has to necessarily play a very important and vital role in short listing and  focusing on the excellent areas of investment for India, appropriate to the India’s need and situation keeping in view the rapidly developing global scenario. The Ministry of Chemicals & Fertilisers has to co ordinate the activities of various government departments with an integrated look and approach and provide broad framework of objectives and priorities, based on which the individual chemical industry can plan and proceed.  For example, one  subject that need particular care and urgent attention is the approach of the Government  to the energy issue. Government has not yet come out with any clear cut plans to meet the impending energy crisis in India and the likely energy gap by 2020. If it has any comprehensive action plan and blue print, it certainly has not shared the same with the Indian chemical industry, apart from isolated announcements often made in seminar halls. If the energy supply would not meet the needs in future, then the energy situation has to be managed by reducing the demand, without affecting the overall growth. Perhaps, the government may have  to announce some firm measures to discourage the energy intensive chemical projects. One wonders as to whether the Ministry of Chemicals & Fertilisers has applied it’s mind to this grave issue at all. The Government also needs to reveal its stand and policy about the place and   role of small scale chemical projects, since large number of them have been forced to close down in recent times and the investment in new chemical projects in small scale sector have fallen down substantially. The financial institutions and banks appear to be  discouraging the investors in small scale chemical projects, as they seem to be under the mistaken impression that small sized chemical projects are incompatible with the present times. Several small scale chemical project entrepreneurs are now running from pillar to post to raise finance for their projects and are often forced to raise money at exorbitant interest.  In the absence of government guidelines, there is bound to be counter productive developments in chemical projects, which may lead to inappropriate investment, wastage of national resources  and plant closure problems.

Indian chemical industries considerably depend on the policies of the Ministry of Chemicals and Fertilisers of Government of India, under  the leadership of knowledgeable people with good understanding of the intricacies of chemical industries in the Indian and global context and who can provide necessary guidelines and policy measures competently.
The capacity creation efforts in chemical industries in China in recent times is truly remarkable. China is one country , perhaps the only country today ,  which can supply almost any chemical  that is of commercial importance in the world.  This clearly shows the extraordinary initiatives of the chemical project entrepreneurs in China and  the constructive and proactive support extended to them by the Government of China and various provincial governments in the country. It is true that huge investments from abroad particularly from USA and Europe have contributed to the creation of such  large capacities in chemical projects in China . One need to keep in view that such inflow of investments and setting up of projects by multi national companies in China is itself an indication of the global confidence in the stability of the chemical industries in China and the strong domestic demand prospects for products in the country. While  building such massive capacities , it is a good sign that efforts are being made by the government agencies in China to  fine tune the chemical industries in the country by enforcing strict  environmental norms , safety measures and preventing counter productive capacity creation and over zealous exploitation of natural resources. The fact that the government of China is willing to close capacities in chemical industries for the sake of optimizing the overall performance is the indication of the progressive and pragmatic approach.  For example,  the Ministry of Industry and Information Technology announced in December,2009 the closing down of the outdated calcium carbide facilities. China has phased out outdated calcium carbide plants with total capacity of around one million  metric tonnes per annum by end 2009. Probably, such situation have arisen, since in some cases , China has built massive capacities without adequate safeguards. For example, there have been massive capacity creation for poly crystalline silicon plants in China making China as the largest capacity holder for poly crystalline silicon production in the world.  This focus on poly crystalline silicon in China is very appropriate in view of the global stress and investment on utilization of solar energy  and China is bound to gain significantly due to its forward planning in creation of capacity for poly crystalline silicon.  However, such massive capacity creation has also resulted in the production of huge quantity of silicon tetrachloride as co product, leading to disposal problem.In this particular case, the other large producers in the world have closed cycle operations to recycle the silicon tetra chloride and China did not have this technology until recently. Such scenario inevitably make one think that China is still dependent in substantial measure on the multinational organizations largely based in Europe and USA for technology and engineering support.  Every major international technology and engineering organization have presence in China  by way of providing technical know how and design and detailed engineering services. At the same time, one does not see the presence of Chinese technology and design organizations providing even fraction of the services to other countries , to the extent that China receives from companies abroad. Companies like Udhe have recently received several engineering and technology contracts in China such as the construction of hydrochloric acid electrolysis plant  at Laiyang, Shandong province  ;  aromatics plant at Tangshan in Hebei province   and Qujing in Yunnan province and Wuhan in Hebei province.  Air liquid has signed 13 new contracts to provide technology for crystalline silicon solar cell manufacture in China. Many other similar cases of dominating role in China by technology and engineering organizations based in western countries can be readily pointed out. It need not be considered as a matter of immediate concern that China is so much dependent on engineering and technology support from organizations based in Europe and USA . But, nevertheless, this indicates the fact that chemical industries in China still have a long way to go to catch up with the Western countries as far as the technology front and R & D efforts are concerned. It is true that great efforts are being made in China to get self sufficiency in the technology front. However, chemical industries in China can be truly considered  as globally competitive, only when it would strengthen itself substantially in the technology front and reduce its dependence on the Western countries for its technology and engineering requirements.
Considering the alarming increase in Indian dependence on global crude and natural gas supply scenario for sustaining the industrial and economic growth, it is extremely important that India should develop alternate sources of energy.  The present and likely excessive dependence on global crude / natural gas supply and price would make the Indian industrial  and economic conditions somewhat insecure.

While the country has made some headway in utilization of wind energy and some earnest steps are being taken by the Government of India and state governments to increase the wind power generation, the UPA government  has focused in a big way on nuclear power generation  to meet the future needs.
While the nuclear power projects have received conflicting views in the country  due to variety of reasons, solar power generation projects would receive unanimous approval, since it is eco friendly and would pave way for utilization of the enormous solar  energy availability in India due to its climatic and tropical  conditions . The concern about the solar power projects is the cost of the solar power generation and investment cost. To ensure that the solar power would be made available to the industrial and non industrial consumers at  affordable cost , the Government of India has to  incur substantial expenditure by way of subsidy support that would run to several thousand million of rupees. However,  in view of the uncertain scenario with regard to the production of crude oil and natural gas in the world in the long  run which are depleting resources and   the likely huge price increase in the crude oil/natural gas in the world market  due to  the pricing policies of the oil/ natural gas producing regions  and other international developments, it is absolutely important and imperative that India has to exploit its natural advantages due to the availability of solar energy to the fullest extent possible.  Considering the need to protect India  from the vulnerability of global crude oil/natural gas price and supply conditions in future, the financial burden due to the subsidy support required for the solar power project in India  has to be viewed in proper perspective and as necessary evil. If the price of crude oil would increase and settle down at above 150 US$ per barrel in future, it would then make the expensive solar power projects to be a better option. Of course, with the research and development efforts, there is distinct possibility of the cost of solar power generation coming down in the course of time. In such circumstances, the Prime Minister setting target of 20000 MW of solar power generation by 2022 should be considered as a bold,  pragmatic and a strategic forward planning decision. In the present conditions, the government of India has to take two essential decisions to take the solar power projects target forward.  The government should promote  massive research & development efforts to optimize the cost of solar power generation. An investment of Rs.10,000 million towards this task in the next five years should be eminently acceptable. The other missing link is that the Government has not announced any schemes to set up  large number of polycrystalline silicon projects, while announcing the 20000 MW solar power target. Poly silicon is the essential material for solar power generation and   one MW of solar power need  10 tonnes of polycrystalline silicon.  This means for generation of 20000MW of solar power, the country needs 0.2 million tonnes of polycrystalline silicon per annum.  The country’s production of polycrystalline silicon now is negligible. Without creation of capacity for polycrystalline silicon, targeting 20000 MW of solar power would make India dependent on international supply scenario of poly silicon.  This would amount to the act of putting the cart before the horse. The present global demand for polycrystalline silicon is around 80000 tonnes per annum and the demand is going up at steady pace around the world.  In the absence of capacity creation for polycrystalline silicon, Indian solar power industry would become vulnerable to international supply and price pressure  for polycrystalline silicon.  India can well avoid this situation, as quartz and  hydrochloric  gas  which are the starting material for the production of poly crystalline silicon are adequately available in the country. The Government of India should move with the solar power project with great speed and alertness that has the potentials to qualitatively improve the energy scenario in India.
Bitumen is a by-product of petroleum refineries. After distilling and extracting the valuable chemicals from petroleum crude ,the left over crude contains bitumen and wax. Bitumen finds huge demand from Govt., for road laying purposes and wax finds its way to cottage industries for candles and artisan works As bitumen is used in raw form for road laying purposes by govt. agencies, any price fluctuation of bitumen (mostly increases) is recognized immediately and passed on to enlisted contractors. Small , micro and tiny industries including self help groups use bitumen for the manufacture of anti corrosive paints, primers , water proofing mats and a few other products for conventional use. These  small and tiny units employ thousands of workforce from unskilled to skilled category . As the market for these products are very price sensitive. It is difficult to pass on the prices in raw materials to customers. Any increase in price of bitumen adversely affects the performance of the consuming industries. This article discusses the following details:
  • Price movement of petroleum crude in the period 2007-09
  • Price movement of bitumen 80/100 in the period 2007-09
The Canada’s oil sands industry has good prospects, if environmental and economic challenges would be met, says a November 2009 report from the France-based International Energy Agency (IEA). As the profitability of oilsands industry currently relies on oil prices of $75 to 80 per bbl, the outlook for oil sands in the medium term is less certain. The drop in oil prices, from about $120 per bbl in October 2008 to between $35 per bbl and $80 per bbl through 2009 has made the crude derived from oil sands less profitable and decreased the incentive for oil companies to invest in expansion. This article further discusses the status and progress of Canada’s oil sand industry.
The recent slow down in the global economy has motivated several companies to redesign their innovation pipelines to take advantage of major trends, such as the drive to cut carbon emissions. Increasingly, firms are realigning their research and development (R&D) capabilities with these trends This article discusses the efforts on the following:
  • DuPont’s efforts
  • Curbing CO2 emission
  • Energy efficiency
  • Water conservation
While natural plant extracts were largely used in the food colourings earlier, the synthetic colours have replaced the natural plant extracts in recent times. With imposition of ban on use of several synthetic dyestuffs (colours) particularly in Europe in recent years, the natural colours are gaining importance. Although plants exhibit a wide range of colours, not all of these pigments can be used. * Some do not dissolve in water
* Some cannot be adsorbed on substrates
* Some others fade when washed or exposed to air or sunlight.
* Therefore, the use of plant materials as natural colour is selective. 
This article further discusses the following:
  • Major natural colours and its application
  • Indian Supply Scenario
  • Selected Indian producers
  • Demand drivers
  • Limitations of Natural Colours
  • Consumer Industry perspective
  • Price factors and market size
  • Lack of application development efforts
  • EU Regulations
  • Growth prospects
  • Demand for natural colours
  • Export market
  • Process
  • Global Manufacturers
  • Global Market Scenario
  • Prognosis
  • Export opportunities
Appearance                     White odourless, crystalline powder Molecular formula C6H14O6 CAS NO.                        69-65-8 Applications Pharmaceutical Sector The major application of mannitol (pyrogen-free) is in the manufacture of IV fluids and in the manufacture of chewable tablets. IV solutions are the basic life saving drugs administered through veins. Mannitol based IV solutions are administered for the removal of excess of water from the body during neurosurgery, eye and kidney operations. In tablets, it is generally used to impart sweet taste. Food Sector
  •         As anticaking and free flow agent
  •         Stabiliser and thickener
  •         Nutritive sweetener
Miscellaneous applications
  •         In making artificial resins and plasticisers
  •         In the manufacture of mannitol hexanitrate
The article further discusses the following:
  • Import details
  • Indian production
  • Demand drivers
  • Growth rate in demand
  • Indian demand & pattern of application sectorwise demand
  • Global scenario
    • Global demand
    • Global manufacturers
  • Manufacturing process
  • Prognosis
Central Leather Research Institute (CLRI), based in Chennai has initiated some interesting research efforts during the year 2009.Highlights of its efforts are provided.
  • Hazardous sulfide gives way to enzymatic option in dehairing
  • Pickle free system for chrome tanning
  • Chrome free tanning system
  • Zero Emission Research Initiative
  • Commissioning of ZLD based CETP
  • SLF for tanneries in Tamil Nadu
  • CETP at Jalandhar Leather Complex
  • Alternate natural materials with leather
  • DIASTEP: an “off the shelf” footwear for low risk diabetics
  • Leads towards wound care products
  • Collagen research – new direction
  • Transfer of know how
  • Transfer of technologies to foreign company
PLANT CLOSURES The article discusses the plans for closure of selected units by the following players
  • Formosa remains on force majeure at Texas Site for PE / PP
  • Ineos declares force majeure on ethylene, propylene
  • BASF Ludwigshafen shut following fire
  • Lyondellbasell declares  force majeure on US VAM
ANTI DUMPING PAGE The antidumping measures introduced in  the various countries in the last few weeks on the following products are discussed:
  • Bus, truck radial tyres
  • Ribonucleotide
  • 1,4-butanediol (BDO)
  • Carbon black
SAFETY AND ACCIDENT PAGE Following safety and accident details are discussed:
  • Explosion in CNPC Lanzhou Petrochemical in China
  • Ammonia leak at Coromandel Fertilisers in India
  • Report on Jaipur oil depot fire in India
NEWS ROUND UP The recent developments on the following products/events are discussed: INTERNATIONAL
  • ‘Green’ Polypropylene
  • Potash / urea
  • Polypropylene catalyst
  • Hydrazine Hydrate
  • Colorants
  • Acrylonitrile
  • CO2 capture project
  • Nipacide p- tert -amylphenol (PTAP)
  • Dispute over PET technology
  • Biodiesel
  • Glencore buys into biodiesel
  • Niacinamide / 3-cyanopyridine
  • Indian firm may acquire DyStar
  • Coal to liquid fuel unit
  • Coal bed methane (CBM) project
  • Centre of excellence for salt to be set up
  • Diamond mining project in MP
  • Fertiliser companies switch to gas
CHINA NEWS The recent developments on the following products/events are updated :
  • Rare earths project in China
  • China cuts tariffs to fulfill WTO Commitments
  • Sulphuric acid
  • Silicon
  • Ethanol to styrene unit
  • Methionine
  • Coal to SNG Project
  • 1,4-ButanediBol
  • Glyphosate
  • Outdated calcium carbide facilities
  • TDI project
  • Phenol/Acetone
  • Project contracts for Uhde
  • Contracts for Air Liquide in solar cell project
TECHNOLOGY DEVELOPMENTS The recent developments on the following technology efforts are highlighted INTERNATIONAL
  • Amino Acids (cystine and cysteine)
  • CO2 into natural gas
  • Enzyme for biofuels production
  • From waste to biofuel
  • IMB developed biotechmycin through genetic engineering
  • Food capsule for soldiers
  • Nano battery for defence
                        PHARMA PAGE The recent developments on the following products/events are discussed:
  • Researchers develop new vaccine
  • Exposure to perfluorooctanoic acid
  • Obesity drug - Sibutramine
  • Green tea  can prevent cancer
  • The story behind vaccine unit’s closure
  • Insulin
AGROCHEMICAL PAGE The recent developments on the following products/events are discussed:
  • Research initiatives to improve crop genes
  • Gooseberry promotion to benefit ayurvedic companies
  • Plan to use mulberry tree leaves to extract tea
  • Shelf life of tomatoes
ENERGY PAGE The recent developments on the following products/events are discussed:
  • Green fund for energy conservation in Haryana in India
  • Nuclear power generation  in India
ENVIRONMENTAL PAGE The recent developments on the following products/events are discussed:
  • Phase out of flame retardant deca-BDE
  • Tighter standards for Ground-Level Ozone
  • Waste to ethanol facilities
  • e-waste auction
  • Plasma can kill bio-waste
PRICE DETAILS - INTERNATIONAL Global price trends on the following products are provided :
  • TiO2
  • Polyvinyl chloride
  • Monoethylene glycol
  • Bisphenol A
  • Paraxylene
  • Polyethylene terephthalate.
  • Orthoxylene
  • Ammonia
  • Ethylene vinyl acetate
  • Butadiene
  • Styrene butadiene rubber
  • Benzene
  • Toluene
  • Polystyrene
  • Potash
  • Crude oil
  • Prices Of Chemical Futures In China As On December 28TH , 2009
  • Spot bulk chemical prices
  • Contract bulk chemical prices
  • Supply of Rajasthan crude by Cairn
  • Tiny Insects Have Features Both For Pest Control And Medicine
  • Safety Concerns On Nanoparticles In Food
  • Global polycrystalline silicon projects
  • Safety concerns on nano particles in food
  • New Projects – International
  • Business opportunities
  • Tender
  • Chemicals Imported At The Chennai Port During The Month Of  December 2009
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