On February 17, 2021, at the headquarters of the Vietnam Fatherland Front Committee of Hai Duong province, the representative of the Board of Directors of An Phat Holdings (APH) directly handed over VND 10 billion (~$425,000) in cash to the representatives of Hai Duong province to join hands and support Covid-19 prevention efforts in the province.
Earlier, at the beginning of February 2021, when Hai Duong detected many Covid-19-SARS-CoV-2 cases, An Phat Holdings donated 100 televisions and 40 tons of essential goods worth VND 1.35 billion (~$57,000) to the Committee for Covid-19 Prevention in Hai Duong province. With 2 times of support worth VND 11.35 billion (~$482,000), An Phat Holdings hopes to make a great contribution to join hands with the government and people of Hai Duong province to fight against Covid-19.
At the headquarters of the Vietnam Fatherland Front Committee of Hai Duong province, the representative of the Board of Directors of An Phat Holdings, Mr. Pham Van Tuan – Acting Deputy CEO of the Group directly handed over VND 10 billion (~$425,000) to the representative of Hai Duong. Hai Duong Province’s Leaders received donation from An Phat Holdings and expressed appreciation to the Board of Directors and employees of the Group.
Hai Duong Province’s Leader received VND 10 billion (~$425,000) support from representative of An Phat Holdings, Mr. Pham Van Tuan – Acting Deputy CEO (3rd from the right)Hai Duong Province’s Leader expressed appreciation for the support of An Phat Holdings
According to current situation, Hai Duong has become an epicenter of the country with 5 major outbreaks areas: Hai Duong City, Chi Linh, Cam Giang, Kinh Mon and Nam Sach. As one of the largest enterprises in Hai Duong, An Phat Holdings quickly call member companies to support Hai Duong to fight the epidemic.
On behalf of An Phat Holdings, Mr. Pham Van Tuan – Acting Deputy CEO shared: “We hope that the support from An Phat Holdings will be timely and able to help the Hai Duong government quickly respond, successfully controlled and stamp out the Covid-19. With the responsibility of an enterprise, we are willing to contribute human and material resources to help Hai Duong overcome this difficult period”.
Along with the community support, An Phat Holdings is actively coordinating with the local authorities to strictly implement prevention measures, ensuring safety for workers returning to work, maintaining production and business activities of the Group during the first quarter of 2021. Up to now, APH and 15 member companies have not appeared positive cases, An Phat Holdings is still absolutely safe.
Previously, in early 2020, An Phat Holdings also donated compostable products to 300 residents and soldiers on quarantine duty in Truc Bach area (Hanoi) and donated 5,000 medical masks and hand sanitizers to Vietnam Embassy in the United States.
China’s domestic PE production increased in Q2, as downstream operations have largely resumed. Some units were shut for planned maintenance in Q2, but new capacities were brought online. Regional southeast Asia supply was slightly reduced initially on turnarounds and unscheduled outages. But margins remained tight, with some producers running at reduced rates due to lockdowns. From around mid-Q2, restrictions were eased and production rates increased but supply – especially from overseas suppliers – remained tight.
China’s Q2 domestic demand improved, as downstream factories resumed operations. Packaging, agricultural film and pipe demand increased due to the government’s economic stimulus, but export orders decreased amid the pandemic. Demand across southeast Asia almost completely dried up through the initial weeks of Q2 due to the coronavirus. Around mid-Q2, demand began to recover. Towards late Q2, some order backlogs and higher offers pushed prices up but converters became very resistant to price hikes.
Updated to Q1 2020
China
Although some local producers choose to cut their operating rates, the output losses were limited. New capacity from Zhejiang petrochemical and Hengli Petrochemical was released in February.
Resumption of work in China gradually recovered in March, but the global economic recession weighed on the market sentiment.
Updated to Q2 2020
Europe
Q2 PE supply was tight in some areas as demand soared for packaging grades. Supply was more important than price for many in the early days of the coronavirus and strong demand kept supply tight in March and April. Food and hygiene grade demand left supply tight and logistical difficulties added to supply issues. By May, most of these issues had eased, moving to a balanced market, although suppliers managed to improve margins.
PE demand in Q2 was very strong, up to 100% stronger than in 2019 in many cases, as packaging demand soared on consumer panic buying in what some called the ‘toilet-roll’ effect. April month-on-month demand was up by as much as 200%, but by the end of the quarter packaging demand was at 2019 levels or slightly below. By June, demand slowed as stocks had built up buying decreased.
US
US PE supplies remained sufficient to meet demand during the second quarter, although the closing weeks of the quarter saw persistent tightness in prompt material as producers trimmed operating rates in April anticipating that demand would decline by a larger amount than was actually observed. Two new LDPE plants from Formosa and Sasol were delayed from planned Q2 start-ups to planned Q3 start-ups.
US PE demand remained flat to higher during Q2, defying expectations and bucking the generally bearish macroeconomic trend that saw many petrochemical products suffer significant losses in consumption. Heavy exposure to the packaging sector and consumer non-durables helped keep PE demand levels up while favourable economics allowed US producers to continue to ramp up export sales.
Africa
Supply levels fluctuated through Q2, the spread of the coronavirus changing the dynamics of global markets week by week. Producers cut production, as they reduced the number of workers in their plants. Availability increased later, as sellers from all over the world searched desperately for any location to sell their products. As lockdown measures were eased towards the end of Q2, supply levels were strained.
Demand took a major hit as the coronavirus began to spread across the continent. Lockdown measures were enforced, and these varied greatly. Total lockdown was enforced in some, while others introduced no measures. The largest economies introduced a night-time curfew, meaning that many workers could maintain their jobs. Social distancing measures reduced hours for many, and some converters shut their plants for a week or two to re-organise their facilities to accommodate this.
Turkey
Availability was significantly affected by the coronavirus pandemic. The Turkey/Iran border was opened to material brought by rail car, although freight costs were very high. The border was then later opened to a limited amount of trucks before being fully opened after Eid ul-Fitr. As markets began closing worldwide, Turkey attracted many offers from around the globe as many sellers looked to offload material. Availability then dropped as suppliers looked to China.
Many converters shut or reduced their operations in June as both the domestic and export markets were decimated by lockdown measures. Food packaging, detergent bottles and protective equipment were the exceptions, but even those markets saw falls in demand from expected rates. From this point, demand has remained largely flat until expected price rises brought some players back to the market at the end of Q2.
Middle East
Early Q2 supply was higher than Q1, following the completion of maintenance at some producer units. The pandemic spread within the region prompted lockdowns in Saudi Arabia by mid-Q2. A spike in cases caused production woes and logistical challenges, hampering regional supply. Crude production cuts also affected ethane supply and hence ethylene and PE availability. Greater allocations to Asia amid recovering demand and higher netbacks also cut regional supply late in the quarter.
Early Q2 demand weakened as regional countries imposed lockdowns and restrictions in their attempts to curb the pandemic spread. Demand for consumer and household products and other non-essential goods plunged, although groceries, foods, and medication continued to be sought. A slowdown during Ramadan and the Eid holiday curtailed uptake in late April and May. Demand recovery in June stayed gradual following a continued rise in cases, even as countries lifted lockdowns to spur economic activity.
Latin America
Q2 supply was lower on reduced operating rates and idled plants amid quarantine measures in the region. Braskem’s ethylene production was reduced to 65%, while Dow idled several plants and Mexico continues to produce at lower rates. While LDPE remains the tightest grade, supply remains sufficient for all grades. Import offers from other regions at were competitive prices but recent currency volatility, tariffs and longer delivery times limited interest.
Q2 demand for PE film grades related to food and medicine packaging continued at normal or slightly reduced levels. Shutdowns and coronavirus demand erosion for construction, automotive and appliances significantly lowered demand, especially for HDPE. The pandemic led to a generalised slowdown in business activity and countries in the region are facing heightened recession risks, while Argentina is negotiating with creditors to avoid default.
The Asia-Pacific polymer market is turning bearish because of an escalation in the US-China trade war, which could lead to higher tariffs being imposed on many chemical products as soon as tomorrow.
The US Trade Representative (USTR) said yesterday it will increase tariffs on $200bn/yr of Chinese imports — including many polymers, aromatics and olefin products — to 25pc from 10pc, effective tomorrow. China may retaliate with similar tariffs.
The announcement came after a sudden deterioration in trade talks between the US and China this week, as US President Donald Trump accused Beijing of attempting to renegotiate a draft deal.
Geopolitics are weighing heavily on decisions of key buyers, trading firms and producers in southeast Asia and India.
Indian and southeast Asian buyers typically track the key China spot and Dalian futures market for price direction. Spot prices for polyethylene (PE) and polypropylene (PP) have largely weakened by around $20-30/t from the previous week.
The polypropylene (PP) market in southeast Asia is starting to turn after a couple of weeks on a bullish run. Offers for PP in southeast Asia were last heard around $1,180/t cfr, down by around $20/t from last week, with buying ideas at $1,150-1,160/t.
In India, buying appetite for PP and linear low density polyethylene (LLDPE) film is weak because of the market uncertainty.
Domestic producers in India had earlier announced price protection measures and reduced domestic polymer prices in an attempt to boost demand.
Indian buyers remain cautious and are not ordering large volumes of spot material for now until the price direction becomes clearer.
The poor fundamentals in India mean Middle East producers have not offered much supply to the country as they opt for markets with better netbacks.
Tomorrow’s threatened increase in the tariff rate to 25pc was previously delayed from March, after Trump expressed satisfaction with the progress of US-China trade talks.
The US imposed the 10pc tariff in September last year. Chemicals covered by the tariffs include benzene, toluene, mixed xylenes, paraxylene, orthoxylene, ethylene, propylene, butadiene, isoprene, methanol, MTBE, chlorine, caustic soda, polypropylene, polyethylene and polyvinyl chloride.
China’s finance ministry imposed retaliatory tariffs of 5-10pc on products including ethylene and polyethylene glycol, styrene-butadiene-rubber, ketones, styrene polymers, PET chips and plasticizers.
The Coronavirus disease (COVID-19) has appeared since the end of 2019, and kept a huge outbreak in early 2020, which has caused a negative impact on Vietnam and many other countries’ economy and social life.
Known as the leading enterprise in the field of manufacturing high-tech and environmentally friendly plastics in Southeast Asia, An Phat Holdings currently has 15 subsidiaries, more than 5,000 employees and factories, and offices throughout Vietnam such as Hanoi, Hai Duong, Hung Yen, Yen Bai, Ho Chi Minh City, Long An, etc. At the same time, An Phat Holdings products are exported to more than 60 countries and regions over the world.
Therefore, the safety assurance of products and workers is An Phat Holdings’ top priority in the complicated situation of the Covid-19 outbreak.
With the motto of “Safety for production and products”, accordingly, An Phat Holdings has maintained a drastic and serious attitude against Covid-19 disease from its headquarters, offices to factories.
From the end of December 2019 to January 2020 when the disease broke out in China and increased the risk in Vietnam, An Phat Holdings established a number of disease prevention committees in all subsidiaries, branches, representative offices, factories, etc., to quickly respond to the Covid-19 related situations
Preventive measures have been strictly implemented by all employees such as: Requiring all employees to wear masks, wash, disinfect their hands, and measure their daily temperature; propagating and timely updating the latest information about on the COVID-19 disease; strictly controlling business trips of all staff, and corporate activities, etc.
Particularly, for the production segment, An Phat Holdings considers this as the focus needing the highest level of attention. In addition to the general measures, An Phat Holdings has applied some other methods like: Ensure the standard distance of minimum 2m2 for workers at factories; Measure temperature for all employees and require all of them to sanitize their hands before and after the shift meals, etc.
With all the preventive measures applied strictly and thoroughly, An Phat Holdings hopes that there will not be any infected cases or suspected cases of within the organization.
Let’s watch the following video clip to further understand An Phat Holdings’ preventive measures to the Covid-19 disease.
On February 4th, at Hai Duong city, the Initiation Conference – Consulting Assistance Program For Supporting Industry Enterprises is organized by Hai Duong People’s Committee, Ministry of Industry and Trade and Samsung Vietnam. The conference includes the signing ceremony of Memorandum of Understanding among Hai Duong People’s Committee, Ministry of Industry and Trade and Samsung Vietnam Company on the consultancy program for Hai Duong enterprises in the supporting industry. Member of Politburo, Deputy Prime Minister, Vuong Dinh Hue witnesses and directs the Conference.
The conference is a vitally important event, contributing to the realization of Government’s Resolution no. 50 in the development of the supporting sector, especially the improvement of the localization and high technology. This is the first time a consultancy program on supporting industry development has been separately organized for one province only, with the participation of three parties, Government – Locality – Enterprise, and Hai Duong is the first selected province. The event will be a strong boost for the growth of Hai Duong’s supporting sector, in the meantime, enterprises within the province will have more business opportunities as well as strengthening their ability to join the global supply chain.
Among the country’s industrial zones, Hai Duong has a developed supporting sector, with great potential, containing favorable factors of infrastructure and resources. In recent years, the growth target in the direction of high technology and increase in the localization rate is one of the provincial government’s leading factors in the development of supporting industry, in cooperation with Samsung Vietnam. In particular, the province has a large number of Vietnamese enterprises that have participated in the supply chains of global corporations, etc. These advantages have contributed to Hai Duong being selected as the first province nationally to deploy the Consultancy Program for the supporting industry.
Among many enterprises in the province, An Phat Holdings (APH) is honored to be trusted by Government, People’s Committee of Hai Duong Province and Samsung Vietnam to be the key member contributing to the development of the supporting industry.
With more than 20 years of experience, APH is now the province’s leading enterprise in developing high technology, increasing the localization rate, especially enhancing the long-term cooperation with large multinational corporations such as Samsung, Honda, Toyota, Yamaha, Panasonic, etc. Particularly, APH has officially become a second-tier vendor of Samsung – the largest mobile phone manufacturing group worldwide from March 2019, in the meantime, APH is implementing investment activities, making systematical improvements in order to become the first-tier vendor of Samsung in the near future. Besides Samsung, APH has been trusted by many other FDI enterprises to produce products with high technological value and gray matter, contributing to the creation of globally famous cars, motorcycles or phones, machines, etc.
The long-term goals of APH are to increase the localization rate of products, develop high technology products, expand investment, and enhance its position in the global supply chain. In addition, APH continuously strengthens its production system, raises labor productivity, standardizes the quality management system according to the most stringent standards worldwide such as ISO 9000, 90001, 14001 and APH is aiming at to IATF16949 standard in the coming time.
From the outstanding experience and achievements, Mr. Dinh Xuan Cuong – Vice Chairman, CEO of APH was honored to be on behalf of hundreds of provincial businesses to deliver the speech and share at the Conference. APH Vice Chairman, CEO said that he would focus on accelerating the localization process, technology transfer and production ownership:
“In the context of localization, we have been and will continue to strive to increase the quantity of Vietnamese gray matter in producing components of phones, automobiles, motorcycles, printers and washing machines, etc, which requires a thorough and comprehensive investment in the capital, technology and manpower.
Regarding technology, we are proud to be the leading enterprise in modernizing the production in the province. We have continuously applied the modernized and cutting-edge facility system to increase the productivity and product quality. In fact, our production lines of molds, mobile phone components, printers, etc, in Hai Duong province always meet the international standards.”
Currently, APH is considered as a dominant high-tech enterprise in Hai Duong province with the most advanced factory system and equipment. In the field of supporting industry, APH has two enterprises in Hai Duong province, which are An Trung Industries & Vietnam Pattern Manufacture and Precision Mechanical Company Limited (VMC), focusing on the production of electrical and electronic components and molds. APH is currently a second-tier vendor of Samsung and also directly participates in Samsung and Ministry of Industry and Trade’s innovative consultancy program.
Besides two companies in Hai Duong, APH has another member company, Hanoi Plastics Joint Stock Company, based in Long Bien, Hanoi, specializing in supplying components and spare parts for the automobile-motorbike industry, with global potential customers like Honda, Toyota, Piaggio, LG Electronics, etc.
Deputy Prime Minister, Mr. Vuong Dinh Hue delivers a speech at the conferenceMr. Tran Tuan Anh, Minister of Ministry of Industry and TradeMr. Nguyen Manh Hien, Hai Duong Province’s leaderVice Chairman, CEO of APH, Mr. Dinh Xuan Cuong makes a speechMr. Choi Joo Ho, President of Samsung VietnamMr. Tran Tuan Anh, Minister of Ministry of Industry and Trade, Mr. Choi Joo Ho, President of Samsung Vietnam, and Mr. Nguyen Manh Hien sign a Memorandum of Understanding
Deputy Prime Minister, Mr. Vuong Dinh Hue pays a visit to APH’s product stall
Business is booming in the polyethylene industry. Thanks to the ability to produce this versatile, recyclable polymer inexpensively, the value of the United States PE industry is forecasted to be $21.3 billion by 2022.¹
It’s clear the demand for this substance isn’t letting up any time soon, so we’ve identified three trends that PE converters, manufacturers, and suppliers should watch as they make supply chain decisions in the coming year.
1. Global Demand Growth
The PE industry is flourishing and global projections by Global Market Insights expect a 6% compound annual industry growth rate between 2018 and 2023. That means this boost will result in a ~215 billion global valuation at the end of this term!2
Linear low-density polyethylene’s (LLDPE) high tensile strength and puncture resistance have helped spur gains in multiple markets, including food and pharmaceutical packaging, which is why it comprises over 45% of total resin usage3. Above-average growth is also forecasted for high-density polyethylene (HDPE) and its value is projected to increase 35% by 2023 driven by rising use in construction products and the increasing popularity of blow-molded HDPE containers in emerging market countries.4
Discover: Key Insights on the Polymer Industry from SPE ANTEC 2020
2. Emphasis on the Customer Experience
As the polyethylene space becomes more influenced by players around the world, differentiation will be a top priority. Unfortunately, many polymer suppliers have been using business technology that hinders operational excellence and slows down key processes. This type of friction is a customer experience issue that may have a greater impact in years to come.
According to Gartner, more than two-thirds of companies in today’s world compete primarily on the basis of customer experience5. As usability and design are improved in the consumer space, procurement teams are expecting more from their B2B tools as well. That’s why PE companies at all levels of the supply chain should be thinking about how to streamline buyer-facing components of their business.
Discover: 5 Characteristics of a Reliable, Innovative Polymer Supplier
3. Continued Demand For Film and Pipe
A wide variety of PE applications are multiplying their market share in 2020, and films and piping are no exception. Food packaging films will be in high demand because quality, multilayer barriers are needed to extend the shelf life of popular, preservative-free goods and reduce food waste6. Another booming industry — e-commerce — will also cause a spike for film that is used to secure goods in a warehousing and logistics.
When it comes to piping, a Freedonia industry study that analyzed the 19.3 billion-meter plastic pipe industry, is predicting a 6.7% growth rate7. Strong construction activity, especially in China and the US, will boost demand as plastic pipe is used in a variety of building applications. This is especially true because plastic’s performance, cost, and installation advantages will spur its use over other pipe materials like concrete, copper, and steel.
On October 15th, Board of Directors of An Phat Bioplasticcs Joint Stock Company (HOSE code: AAA) issued a Resolution on Stopping Employee Stock Ownership Plan (ESOP).
Previously, AAA’s Board of Directors approved the plan of issuing shares under the ESOP program, corresponding to issuing a maximum of 8.5 million shares at the price of VND 10,000 / share in accordance with Resolution of 2019 Annual General Meeting of Shareholders on April 16.
Up to now, AAA’s Board of Directors have decided to stop this ESOP program, then the company will report and present the cancellation of ESOP issuance plan at the nearest General Meeting of Shareholders.
“The ESOP program was approved at 2019 General Meeting of Shareholders, but after considering the actual situation, taking into account the long-standing benefits of shareholders, AAA Board of Directors decided to stop the 2019 ESOP program and cancel this at the General Meeting of Shareholders in 2020”– added AAA representative
In addition, Ho Chi Minh City Stock Exchange also forecast that AAA’s net revenue and profit after tax in 2019 will be VND 9,884 billion and VND 501 billion, increasing by 12% and 25% respectively compared to 2018. Based on these profit estimates and the current number of shares (due to no increase in ESOP stocks), AAA’s EPS can be reached at VND2,930 / share. According to the report of Ho Chi Minh City Stock Exchange (HOSE: HCM), on July 7, estimating that AAA’s after-tax profit in the 2019 third quarter will reach around VND 55-65 billion, correspondingly increasing by from14.5% to 35.4% compared to the same period last year.
In early October, An Phat Holdings (APH) registered to buy all 4,000 AAA warrants issued in 2018 to increase its ownership in AAA from 46.62% to 54.54% from October 17 to November 15.
From September 27 to October 4, 2019, An Phat Holdings in cooperation with My Dinh I Primary School (Hanoi) organized a drawing contest entitled “Drawing a Green Future”.
The competition received more than 300 diverse and impressive works of elementary school students. The authors of these paintings surprised the organizers because of their understanding and responsibility when expressing creative ideas to protect the green planet, human life, as well as the environment.
Some children also showed their concern about the alarming situation the environment pollution and the plastic waste problem as well.
The works of “Draw a green future” were expressed with a variety of colorful materials such as pencils, pigments, crayons, oil paints, watercolors, etc. through the clever, creative hands of little artists.
An Phat Holdings’ representative said: “We hope that, by this contest, we can spread environmental protection messages to our future generations. Children play an important part in developing a green Vietnam in the future.”
The final contest results of “Draw a green future” will be announced on October 10, 2019.
Some impressive paintings made by students of My Dinh I Primary School:
An Phat Open Football Cup 2019 was successfully organized to celebrate 17th anniversary of An Phat Holdings’ establishment and development. This year, there were 14 football teams of member companies, together with 07 guest teams.
With careful preparation, the football teams joined the matches with the spirit of solidarity, playing hard, creating vibrant matches, making fans emotionally engaged with all teams.
After all rounds, Taseco team won the championship of the An Phat Open Footaball Cup 2019. The expected final match ended with a score of 1 – 0 in favor of Taseco. Although Viexim team competed tremendously, luckiness was not for Viexim this year.
In summary: CHAMPION: TASECO Table A:
+ First Prize: VIEXIM
+ Second Prize: WAREHOUSING
+ Third Prize: FACTORY 6 Table B:
+ First Prize: TASECO
+ Second Prize: HAI DUONG UNIVERSITY
+ Third Prize: BIDV SGD1 – VIETINBANK HAI DUONG IZ
Congratulations to all teams!
