Mono propylene glycol (MPG)

LONDON (ICIS)–LyondellBasell has entered into exclusive talks with an industrial investor for the sale of four European production sites, slightly over a year after launching a review of its asset base in the region. The company entered into the talks with AEQUITA, a Germany-based investment group specialising in turnarounds and carve-outs. Other assets acquired by the firm include a bake disc technology company purchased from Bosch, a cloud solutions business from Fujitsu, and a glass manufacturer from Saint-Gobain. AEQUITA is in position to take control of four sites of the nine operated by LyondellBasell in Europe in the deal, spanning France, Germany, Spain and the UK. Sites to be sold Site Production (tonnes/year) Berre, France Ethylene (465,000 tonnes/year) LDPE (320,000 tonnes/year PP (350,000 tonnes/year Propylene (255,000 tonnes/year) Munchsmunster, Germany Ethylene (300,000 tonnes/year) HDPE (320,000 tonnes/year) Propylene (190,000 tonnes/year) Carrington, UK PP (210,000 tonnes/year) Tarragona, Spain PP (390,000 tonnes/year) That leaves LyondellBasell with its Knapsack and Wesseling, Germany, site – collectively its largest production centre in Europe – as well as Frankfurt, Germany; Moerdijk, Netherlands; Brindisi, Italy and Tarragona, Spain. Collectively, the sites represent a “scaled” olefins and polyolefins platform with operations close to customer demand, LyondellBasell said, although the size of the crackers in the portfolio are smaller than many capacities that have come on-stream in the last few years. “We are confident in our ability to accelerate their development under AEQUITA’s ownership approach,” said Christoph Himmel, Managing Partner at AEQUITA. The current agreement entered into takes the form of a put option deed, which grants the owner the right but not the obligation to sell an asset at a specific price. In this case, AEQUITA has agreed to purchase at the agreed-upon terms if LyondellBasell opts to exercise the option after concluding works council consultation processes. The financial terms of a sale have not yet been disclosed, but the current timeline would see the deal close in the first half of 2026, LyondellBasell added. The Europe review is part of a wider shift in footing towards three key pillars for the business. Announced in 2023, this is based on prioritizing spending on businesses where the company “has leading positions in expanding and well-positioned markets”, growing circular solutions earnings to $1 billion/year by 2030, and shifting from cost controls to a broader idea of value creation. The company’s strategy for its remaining European asset base will be based around sustainability and the circular economy, according to Lyondell CEO Peter Vanacker. “Europe remains a core market for LyondellBasell and one we will continue to participate in following this transaction with more of a focus on value creation through establishing profitable leadership in circular and renewable solutions," he said. Update adds detail throughout Thumbnail photo: LyondellBasell's site in Wesseling, Germany, one of the European assets it is retaining (Source: LyondellBasell)

05-Jun-2025

COLORADO SPRINGS, Colorado (ICIS)–Uncertainty surrounding tariffs is tempering what could be a recovery in US demand for polypropylene (PP), executives at Braskem said on Wednesday. Uncertainty about the final makeup of tariffs and their effects on end markets have caused consumers and companies to delay purchases, said Alexandre Elias, vice president, PP, North America and Europe, Braskem. Elias made his comments in an interview with ICIS on the sidelines of the annual meeting of the American Chemistry Council (ACC). Companies are reluctant to build inventories and make investments – especially industrial PP customers that have long investment cycles, Elias said. TARIFFS HAVE COUNTERVAILING EFFECTS ON AUTOAutomobiles are one of the main end markets for PP, and the tariffs have had mixed effects on production, contributing to the uncertainty of PP demand from the sector. The US has imposed tariffs on imports of automobiles and auto parts, which could ultimately stimulate local production and PP demand. Prior to those tariffs, consumers splurged on automobiles to beat the tariffs. All of that pre-buying lowered inventories of US autos, said Bill Diebold, vice president – commercial, Braskem America, polyolefins. US producers will ultimately replenish those inventories, which will further increase auto output and PP demand. On the other hand, consumer confidence has fallen after the introduction of the tariffs and that tends to slow demand growth for automobiles and other durable goods that are made with PP. Chinese restrictions on shipments of rare earth magnets could cause some automobile companies to shut down production within weeks if they cannot find workarounds, according to an article from the Wall Street Journal, a business publication. The US recently increased its tariffs on imports of steel and aluminium to 50% from 25%, which would increase production costs for US automobiles and potentially make them less affordable. The future of the tariffs themselves is uncertain because the US frequently changes the rates. It could impose new tariffs, and the courts could rule that the US lacks authority to impose them under a key provision. The interactions of all of these variables make it difficult to forecast PP demand from the US automobile industry, Elias said. PP DEMAND REMAINS FLAT YEAR ON YEARIn the US, PP demand is up in Q2 versus Q1 but flat year on year, Diebold said. Similarly demand improved in Q1 versus Q4, the latter of which was a challenging time for the US market, Diebold said. Packaging, another major end market for PP, remains strong. PP is enjoying a boost from a wave of product substitutions, Elias said. Over the years, many polystyrene (PS) processors have switched to PP because of its price. Many of those substitutions have played out, but a smaller wave is now taking place. That said, uncertainty could be capping the potential of product substitutions from other processors. LPG RESTRICTIONS TO CHINA COULD ALTER PP TRADE FLOWSGlobal trade flows of PP could change significantly if the US restricts exports of liquefied petroleum gas (LPG) to China. China relies heavily on US LPG shipments to provide feedstock for its large fleet of propane dehydrogenation (PDH) units, which produce on-purpose propylene. The US already has imposed restrictions on exports of ethane to China, which would disrupt a few ethane crackers in the country. If trade tensions rise, it could expand the restrictions to cover LPG. Global markets got a taste of the ramifications of restricted LPG shipments earlier this year when China increased tariffs on US imports by triple digits. Had China maintained those increases, Chinese propylene production would likely fall, according to ICIS. China could still procure LPG from exporters from other parts of the world, but that would increase costs and make some production uncompetitive. Lower Chinese propylene production would have a cascading effect. It could lower domestic production of PP and cut down on Chinese exports to other parts of Asia. That, in turn, could allow domestic Asian producers to sell more material locally, allowing them to be less aggressive about exporting PP, Elias said. "This could have a significant impact on trade flows globally," Elias said. In fact, restrictions on US LPG shipments to China would likely have a bigger effect on PP trade flows then actual tariffs on the resin. So far, the introduction of US tariffs has had little direct effect on US PP, because the market is relatively balanced. In 2023 and 2024, apparent consumption was about 85% of total production in the US, according to the ICIS Supply and Demand Database. Braskem does have an option to export PP from a terminal in Charleston, South Carolina, but this terminal functions more as a way to take advantage of arbitrage opportunities and leverage its PP plants in North America, Elias said. As an option, it has worked well. LITTLE NEED FOR NEW PROPYLENE CAPACITYBraskem relies on third parties for propylene for its PP plants in the US. So far, there is no need for Braskem to build its own propylene capacity, Elias said. The US is long in propylene, as illustrated by the global competitiveness of its exports, he said While Braskem has relied on propylene imports from Canada, trade tensions between it and the US have eased. Were trade tensions to resume and cause an increase in tariffs, Braskem could manage around it, Elias said. The ACC Annual Meeting runs through Wednesday. Focus article by Al Greenwood Thumbnail shows a product made with PP. Image by Shutterstock.

04-Jun-2025

HOUSTON (ICIS)–The US can maintain nearly all the plastic and chemical tariffs it imposed this year after an appeals court granted on Thursday the government's request to stay the judgment of a lower court. The stay will remain in place while the case is under consideration by the US Court of Appeals for the Federal Circuit. Earlier, the US lost a judgment over its tariffs in the US Court of International Trade. That lower court ruled that the president exceeded its authority when it imposed tariffs under the International Emergency Economic Powers Act (IEEPA). These IEEPA tariffs included nearly all of the duties that the US imposed in 2025 on imports of commodity plastics and chemicals. Had the appeals court rejected the government's request for a stay, then the US would have had 10 calendar days to withdraw the tariffs it imposed under IEEPA. The tariffs covered by the ruling include the following: The 10% baseline tariffs against most of the world that the US issued during its so-called Liberation Day event on 2 April. These include the reciprocal tariffs that were later paused. The US issued the tariffs under Executive Order 14257, which intended to address the nation's trade deficit. The tariffs that the US initially imposed on imports from Canada under Executive Order 14193. These were intended to address drug smuggling. The US later limited the scope of these tariffs to cover imported goods that do not comply with the nations' trade agreement, known as the US-Mexico-Canada Agreement (USMCA). The tariffs that the US initially imposed on imports from Mexico under Executive Order 14194. These were intended to address illegal immigration and drug smuggling. Like the Canadian tariffs, these were later limited to cover imported goods that did not comply with the USMCA. The 20% tariffs that the US imposed on imports from China under Executive Order 14195, which was intended to address drug smuggling. Because the appeals court granted the government's request for a stay, the US can maintain the IEEPA tariffs. The ruling did not cover sectoral tariffs imposed on specific products like steel, aluminium and auto parts, and it does not cover the duties that the US imposed on Chinese imports during the first term of US President Donald Trump. IMPLICATIONS OF THE RULINGIf the ruling is upheld by the higher courts, it could bring some imports of plastics and chemicals back to the US while lowering costs of other products. While the US has large surpluses in many plastics and chemicals, it still imports several key commodities. US states that border Canada import large amounts of polyethylene (PE) and other plastics from that country because it is closer than the nation's chemical hubs along the Gulf Coast. Other significant imports include base oils, ammonia, polyethylene terephthalate (PET), methylene diphenyl diisocyanate (MDI), methanol and aromatics such as benzene, toluene and mixed xylenes (MX). RULING COULD REDIRECT CHINESE EXPORTS OF PLASTIC PRODUCTSThe IEEPA tariffs of the US caused countries to redirect exports of plastics and chemicals to other markets, particularly to Europe. The result depressed prices for those plastics and chemicals. If the ruling holds, some of those exports could return to the US and reduce the quantity of exports arriving in Europe. The IEEPA tariffs had a similar effect on the plastic products exports by China. Those exports were redirected to other countries, especially southeast Asia. These redirected shipments flooded those countries with plastic goods, displacing local products and lowering domestic demand for the plastics used to make those products. If the ruling is restored by higher courts, then it could direct many of those shipments back to the US, although they would unlikely affect shipments of auto parts. Those shipments are covered by the sectoral tariffs, and the court ruling did not void those tariffs. RULING REMOVES BASIS FOR RETALIATORY TARIFFS AGAINST US PLASTICS, CHEMSChina had already imposed blanket tariffs in retaliation to the IEEPA tariffs the US imposed on its exports. China unofficially granted waivers for US imports of ethane and PE, but those for liquefied petroleum gas (LPG) were still covered by the duty. China relies on such imports as feedstock for its large fleet of propane dehydrogenation (PDH) units, which produce on-purpose propylene. If upheld, the ruling could restore many of those exports and improve propylene margins for those PDH units. The EU was preparing to impose retaliatory tariffs on exports of nearly every major commodity plastic from the US. Other proposals would cover EU imports of oleochemicals, tall oil, caustic soda and surfactants from the US. Canada also prepared a list of retaliatory tariffs that covered US imports of PE, polypropylene (PP) and other plastics, chemicals and fertilizers. If the ruling holds, it would remove the basis for the proposed tariffs of Canada and the EU as well as the existing ones already imposed by China. RULING WOULD NOT ELIMINATE THREAT OF FUTURE TARIFFSEven if the higher courts uphold the ruling and bars tariffs under IEEPA, the US has other means to impose duties that are outside of the bounds of the ruling. Section 122 of the Trade Act of 1974. Such tariffs would be limited to 15%, could last for 150 days and address balance of payment deficits. Tariffs imposed under the following statutes would require federal investigations, which could delay them by several months. Section 338 of the Tariff Act of 1930. The president can impose tariffs of up to 50% against countries that discriminate against US commerce. Section 301 of the Trade Act of 1974, which addresses unfair trade practices. This was the basis on the tariffs imposed on many Chinese imports during the peak of the trade war between the two countries. Section 232 of the Trade Expansion Act of 1962, which addresses imports with implications for national security. Trump used this provision to impose tariffs on steel and aluminum. The US has started Section 232 on the following imports: Pharmaceutical and active pharmaceutical ingredient (APIs) – Section 232 Semiconductors and semiconductor manufacturing equipment – Section 232 Medium and heavy-duty trucks, parts – Section 232 Critical minerals – Section 232 Copper – Section 232 Timber and lumber – Section 232 Commercial aircraft and jet engines – Section 232 Ship-to-shore cranes assembled in China or made with parts from China – Section 301 Shipbuilding – Section 301 The case number for the appeal is 2025-1812. The original lawsuit was filed in the US Court of International Trade by the plaintiffs VOS Selections, Genova Pipe, Microkits, FishUSA and Terry Precision Cycling. The case number is 25-cv-00066. Thumbnail Photo: A container ship, which transports goods overseas. (Image by Costfoto/NurPhoto/Shutterstock) Visit the ICIS Topic Page: US tariffs, policy – impact on chemicals and energy

29-May-2025

BARCELONA (ICIS)–ExxonMobil is selling its refinery at Gravenchon, France, to Canadian refining group North Atlantic. The two companies have entered exclusive negotiations for North Atlantic to acquire an 82.89% controlling interest in Esso Société Anonyme Française SA and 100%  of ExxonMobil Chemical France. Filing of a tender offer is expected in the first quarter of 2026 for the deal which includes Exxon’s refinery at the Gravenchon site, the second largest refinery in France. The  transaction will be submitted to local trade unions in accordance with French law. In 2024, ExxonMobil sold its Fos-Sur-Mer refinery near Marseille, France, along with fuel terminals in Toulouse and Villette. The company also closed its cracker and downstream production  at Gravenchon in 2024. At the time, the company said the site had lost more than €500 million since 2018 and despite efforts to improve the site’s economics, it remained uncompetitive. According to the ICIS Supply & Demand Database ExxonMobil still has some small chemicals capacities at Gravenchon and nearby Port Gerome including propylene, polyalphaolefins and oligomers. Local trades union, CSEC, said in a press release that ExxonMobil would market chemicals and specialty products on behalf of the new owners. ExxonMobil did not reply to a request for confirmation of this. It also has large base oils capacities in France including 12,000 barrels/day at Port Jerome and 3,200 barrels/day at Gravenchon. In a statement released on 28 May, North Atlantic said it has the ambition to consolidate Gravenchon as a center of French energy and industry for decades and to grow North Atlantic into a transatlantic energy champion. Located on a 1,500-acre site in the Normandy region of France, the combined facility is one of the largest integrated chemical complexes in western Europe. The refinery includes two distillation trains, several conversion units and associated logistics facilities. The site has the capacity to process 230,000 barrels/day of crude oil and other feedstocks, according to North Atlantic. North Atlantic said it aims to develop Gravenchon into a green energy hub to accelerate the deployment of low-carbon fuels and renewable power. The company said it is committed to maintain employment and existing compensation and benefits. Ted Lomond, president and CEO of North Atlantic and president of North Atlantic France said: “This is a pivotal moment for North Atlantic as we enhance our transatlantic presence and commitment to energy security through innovative energy solutions aligned with global energy needs”. Ajay Parmar, ICIS director of energy and refining said: “My view is that Exxon is choosing to sell assets where profitability has been and likely will continue to be dented going forward. Refinery margins in Europe have returned back to around their pre-COVID levels this year, after a few years of bumper profits post-pandemic.” He added: “These refinery assets are less profitable and so the company is probably looking to divest for this reason. Exxon/Esso also sold off the Fos-Sur-Mer refinery last year – I think the strategy is to steadily exit these lower margin businesses.” Photo: Part of an oil refinery complex (Shutterstock) Focus article by Will Beacham

28-May-2025

HOUSTON (ICIS)–The US delay of its proposed 50% tariffs on EU imports will still leave its polymers vulnerable to retaliatory tariffs. The new deadline is 9 July. For US exports, the EU has already drafted a list of targets for retaliatory tariffs, part of its second round of €95 billion in tariffs on US imports. A full list of all the proposed imports can be found here. This is on top of the first round of €21 billion in tariffs on US imports. A full list of all the proposed imports can be found here. In all, the EU could impose tariffs on nearly every major polymer from the US, including polyethylene (PE), polypropylene (PP), polystyrene (PS), polyvinyl chloride (PVC) and polyethylene terephthalate (PET). The EU is also considering tariffs on US imports of surfactants, fatty acids, fatty alcohols, and tall oil, a feedstock used to make renewable diesel, sustainable aviation fuel (SAF) and renewable naphtha. The following table lists some of the many plastics and chemicals proposed on the EU's second round of tariffs. CN CODE DESCRIPTION 28151200 sodium hydroxide "caustic soda" in aqueous solution "soda lye or liquid soda" 29053926 butane-1,4-diol or tetramethylene glycol [1,4-butanediol] having a bio-based carbon content of 100% by mass 29091910 tert-butyl ethyl ether (ethyl-tertio-butyl-ether, etbe) 29152100 acetic acid 29153200 vinyl acetate 29291000 isocyanates 32061100 pigments and preparations based on titanium dioxide of a kind used for colouring any material or produce colorant preparations, containing >= 80% by weight of titanium dioxide calculated on the dry matter (excl. preparations of heading 3207, 3208, 3209, 3210, 3212, 3213 and 3215) 32061900 pigments and preparations based on titanium dioxide of a kind used for colouring any material or produce colorant preparations, containing < 80% by weight of titanium dioxide calculated on the dry matter (excl. preparations of heading 3207, 3208, 3209, 3210, 3212, 3213 and 3215) 34023100 linear alkylbenzene sulphonic acids and their salts 34023990 anionic organic surface-active agents, whether or not put up for retail sale (excl. linear alkylbenzene sulphonic acids and their salts, and aqueous solution containing by weight 30-50% of disodium alkyl [oxydi(benzenesulphonate)]) 34024100 cationic organic surface-active agents, whether or not put up for retail sale 34024200 non-ionic organic surface-active agents, whether or not put up for retail sale (excl. soap) 34024900 organic surface-active agents, whether or not put up for retail sale (excl. soap, anionic, cationic and non-ionic) 34025010 surface-active preparations put up for retail sale (excl. organic surface-active preparations in the form of bars, cakes, moulded pieces or shapes, and organic surface-active products and preparations for washing the skin in the form of liquid or cream) 38030010 crude tall oil 38030090 tall oil, whether or not refined (excl. crude tall oil) 38170050 linear alkylbenzene 38170080 mixed alkylbenzenes and mixed alkylnaphthalenes, produced by the alkylation of benzene and naphthalene (excl. linear alkylbenzene and mixed isomers of cyclic hydrocarbons) 38231100 stearic acid, industrial 38231200 oleic acid, industrial 38231300 tall oil fatty acids, industrial 38231910 fatty acids, distilled 38231930 fatty acid distillate 38231990 fatty acids, industrial, monocarboxylic; acid oils from refining (excl. stearic acid, oleic acid and tall oil fatty acids, distilled fatty acids and fatty acid distillate) 38237000 fatty alcohols, industrial 38260010 fatty-acid mono-alkyl esters, containing by weight => 96,5 % of esters "famae" 38260090 biodiesel and mixtures thereof, not containing or containing < 70 % by weight of petroleum oils or oils obtained from bituminous minerals (excl. fatty-acid mono-alkyl esters containing by weight >= 96,5 % of esters "famae") 39013000 ethylene-vinyl acetate copolymers, in primary forms 39019080 polymers of ethylene, in primary forms (excl. polyethylene, ethylene-vinyl acetate copolymers, ethylene-alpha-olefins copolymers having a specific gravity of < 0,94, ionomer resin consisting of a salt of a terpolymer of ethylene with isobutyl acrylate and methacrylic acid and a-b-a block copolymer of ethylene of polystyrene, ethylene-butylene copolymer and polystyrene, containing by weight <= 35% of styrene, in blocks of irregular shape, lumps, powders, granules, flakes and similar bulk forms) 39021000 polypropylene, in primary forms 39023000 propylene copolymers, in primary forms 39029010 a-b-a block copolymer of propylene or of other olefins, of polystyrene, ethylene-butylene copolymer and polystyrene, containing by weight <= 35% of styrene, in blocks of irregular shape, lumps, powders, granules, flakes and similar bulk forms 39029020 polybut-1-ene, a copolymer of but-1-ene with ethylene containing by weight <= 10% of ethylene, or a blend of polybut-1-ene with polyethylene and/or polypropylene containing by weight <= 10% of polyethylene and/or <= 25% of polypropylene, in blocks of irregular shape, lumps, powders, granules, flakes and similar bulk forms 39031100 expansible polystyrene, in primary forms 39031900 polystyrene, in primary forms (excl. expansible) 39032000 styrene-acrylonitrile copolymers "san", in primary forms 39033000 acrylonitrile-butadiene-styrene copolymers "abs", in primary forms 39039090 polymers of styrene, in primary forms (excl. polystyrene, styrene-acrylonitrile copolymers "san", acrylonitrile-butadiene-styrene "abs", copolymer solely of styrene with allyl alcohol, of an acetyl value of >= 175 and brominated polystyrene, containing by weight >= 58% but <= 71% of bromine, in blocks of irregular shape, lumps, powders, granules, flakes and similar bulk forms) 39041000 poly"vinyl chloride", in primary forms, not mixed with any other substances 39042100 non-plasticised poly"vinyl chloride", in primary forms, mixed with other substances 39042200 plasticised poly"vinyl chloride", in primary forms, mixed with other substances 39051200 poly"vinyl acetate", in aqueous dispersion 39051900 poly"vinyl acetate", in primary forms (excl. in aqueous dispersion) 39052100 vinyl acetate copolymers, in aqueous dispersion 39052900 vinyl acetate copolymers, in primary forms (excl. in aqueous dispersion) 39053000 poly"vinyl alcohol", in primary forms, whether or not containing unhydrolyzed acetate groups 39061000 poly"methyl methacrylate", in primary forms 39071000 polyacetals, in primary forms 39072911 polyethylene glycols, in primary forms 39072920 polyether alcohols, in primary forms (excl. bis(polyoxyethylene) methylphosphonate and polyethylene glycols) 39072999 polyethers in primary forms (excl. polyether alcohols, polyacetals and copolymer of 1- chloro-2,3-epoxypropane with ethylene oxide) 39073000 epoxide resins, in primary forms 39074000 polycarbonates, in primary forms 39075000 alkyd resins, in primary forms 39076100 poly"ethylene terephthalate", in primary forms, having a viscosity number of >= 78 ml/g 39076900 poly"ethylene terephthalate", in primary forms, having a viscosity number of < 78 ml/g 39079110 unsaturated liquid polyesters, in primary forms (excl. polycarbonates, alkyd resins, poly"ethylene terephthalate" and poly"lactic acid") 39079190 unsaturated polyesters, in primary forms (excl. liquid, and polycarbonates, alkyd resins, poly"ethylene terephthalate" and poly"lactic acid") 39079980 polyesters, saturated, in primary forms (excl. polycarbonates, alkyd resins, poly"ethylene terephthalate", poly"lactic acid", poly"ethylene naphthalene-2,6-dicarboxylate" and thermoplastic liquid crystal aromatic polyester copolymers) 39089000 polyamides, in primary forms (excl. polyamides-6, -11, -12, -6,6, -6,9, -6,10 and -6,12) 39091000 urea resins and thiourea resins, in primary forms 39092000 melamine resins, in primary forms 39093100 poly"methylene phenyl isocyanate" "crude mdi, polymeric mdi", in primary forms 39094000 phenolic resins, in primary forms 39095010 polyurethane of 2,2'-"tert-butylimino"diethanol and 4,4'-methylenedicyclohexyl diisocyanate, in the form of a solution in n,n-dimethylacetamide, containing by weight >= 50% of polymer 39095090 polyurethanes in primary forms (excl. polyurethane of 2,2'-"tert-butylimino"diethanol and 4,4'-methylenedicyclohexyl diisocyanate, in the form of a solution in n,ndimethylacetamide) Source: EU CN CODE DESCRIPTION 39011010 linear polyethylene with a specific gravity of < 0,94, in primary forms 39011090 polyethylene with a specific gravity of < 0,94, in primary forms (excl. linear polyethylene) 39012010 polyethylene in blocks of irregular shape, lumps, powders, granules, flakes and similar bulk forms, of a specific gravity of >= 0,958 at 23°c, containing <= 50 mg/kg of aluminium, <= 2 mg/kg of calcium, of chromium, of iron, of nickel and of titanium each and <= 8 mg/kg of vanadium, for the manufacture of chlorosulphonated polyethylene 39012090 polyethylene with a specific gravity of >= 0,94, in primary forms (excl. polyethylene in blocks of irregular shape, lumps, powders, granules, flakes and similar bulk forms, of a specific gravity of >= 0,958 at 23°c, containing <= 50 mg/kg of aluminium, <= 2 mg/kg of calcium, of chromium, of iron, of nickel and of titanium each and <= 8 mg/kg of vanadium, for the manufacture of chlorosulphonated polyethylene) 39014000 ethylene-alpha-olefin copolymers, having a specific gravity of < 0,94 , in primary forms 39081000 polyamides-6, -11, -12, -6,6, -6,9, -6,10 or -6,12, in primary forms Source: EU

27-May-2025

SINGAPORE (ICIS)–Click here to see the latest blog post on Asian Chemical Connections by John Richardson. I could present a dozen charts such as the main one in today's post on polypropylene (PP) — for example on polyethylene (PE), ethylene, propylene and styrene—and the patterns would be similar though, of course, the numbers would differ. During the pandemic, while demand dipped in many places, China’s PP consumption rose—from 7% growth in 2019 to 9% in 2020, then stayed strong at 7% in 2021. The same trend played out across other chemicals and polymers. This was the “China in, China out” story: Rising imports of feedstocks to make finished goods that lockdown-affected, cash-rich Westerners were snapping up, backed by stimulus. Margins climbed—not just from demand, but also from refinery feedstock shortages as fuel demand dropped and refinery rates were cut. But 2022 marked a shift. As ICIS Data and Analytics illustrates, multiple headwinds kicked in: The Evergrande Turning Point, China's constantly deteriorating demographics, and a China petrochemicals self-sufficiency drive dating back to 2014. Focusing on China's PP self-sufficiency and exports: China's PP capacity as a percentage of domestic demand is expected to surge from 89% in 2014 to 134% by 2028. In 2020, China’s PP exports were around 500,000 tonnes. In 2023 they reached 1.3m tonnes and climbed to 2.4m tonnes in 2024. ICIS data suggests China’s exports in 2025 could reach 3.1m tonnes. On current trends, China’s exports to ASEAN could exceed 1 million tonnes to ASEAN in 2025 versus less than 900,000 tonnes in 2024. The trade war? Hard to say if it's moved the needle. These structural trends were in motion long before it began—and they’ll likely outlast it too. Sentiment swings (as seen since April’s “Liberation Day”) will keep influencing prices and buying patterns, but the fundamentals remain. The Chemicals Supercycle is over. What comes next? That’s the big question. Editor’s note: This blog post is an opinion piece. The views expressed are those of the author, and do not necessarily represent those of ICIS.

26-May-2025

HOUSTON (ICIS)–Asia-US rates for shipping containers rose this week, leading ocean carriers to rush to ramp up capacity to handle an expected surge in bookings. Rates from online freight shipping marketplace and platform provider Freightos rose by 3% to both US coasts, while rates from supply chain advisors Drewry showed a 2% increase on rates from Shanghai to Los Angeles and a 4% rise in rates from Shanghai to New York, as shown in the following chart. Following the latest US-China trade developments, Drewry expects an increase in spot rates in the coming week as carriers are reorganizing their capacity to accommodate a higher volume of cargo bookings from China. Kyle Beaulieu senior director, head of ocean Americas at Flexport, said during a webinar this week that carriers who initiated blank sailings and discontinued services to the US are now resuming services. Beaulieu said there were 10 China-US services that were halted, and as of today, six are planning to resume from Week 22 to Week 24. Beaulieu said ports in the Pacific Northwest have been the biggest beneficiaries so far as that is the shortest route to the US. Alan Murphy, CEO, Sea-Intelligence, said carriers who were reducing transpacific capacity due to the decrease in bookings from China amid 145% tariffs are now working to ramp up capacity prior to the 14 August deadline. This means that typical peak season volumes now must be shipped no later than mid-July. Judah Levine, head of research at Freightos, said there is still confusion on whether July and August deadlines mean goods need to be loaded at origins by those dates – as was the case with the 9 April tariff deadline – or that goods must arrive in the US by then. “The latter would significantly shorten these lower-tariff windows,” Levine said. “Ocean shipments from Asia would have to move in the next week or two to arrive before 9 July.” Levine noted that carriers have separately come out with mid-month general rate increases (GRIs) from $1,000-3,000/FEU (40-foot equivalent unit) and have similar GRIs planned for 1 June and 15 June with aims to get rates up to $8,000/FEU. “If successful, rate levels would be about on par with the Asia – US West Coast 2024 high reached last July,” Levine said. “Daily transpacific rates as of Monday have already increased about $1,000/FEU to the East Coast and $400/FEU to the West Coast to about $4,400/FEU and $2,800/FEU, respectively.” Container ships and costs for shipping containers are relevant to the chemical industry because while most chemicals are liquids and are shipped in tankers, container ships transport polymers, such as polyethylene (PE) and polypropylene (PP), are shipped in pellets. Titanium dioxide (TiO2) is also shipped in containers. They also transport liquid chemicals in isotanks. LIQUID TANKER RATES HOLD STEADY US liquid chemical tanker freight rates as assessed by ICIS held steady this week despite upward pressure for several trade lanes. There is upward pressure on rates along the US Gulf-Asia trade lane as charterers are seeking to send cargos to the region following the pause on tariffs. The announcement caused a significant uptick in spot activity. The increase in interest should be significant but almost certainly short lived as cargoes rush to arrive prior to the 90-day expiration date. Several parcels of monoethylene glycol (MEG) and methanol were seen quoted in the market. Similarly, rates from the USG to Rotterdam were steady this week, even as space among the regular carriers remains limited. Contract tonnage continues to prevail and given the limited available space; spot demand remains relatively good. Several larger sized cargos of styrene, methanol, MTBE and ethanol were seen in the market. Several outsiders have come on berth for both May and June, adding to the available tonnage for completion cargos. Easing demand for clean tankers has attracted those vessels to enter the chemical sector. For the USG to South America trade lane, rates remain steady with a few inquiries for methanol and ethanol widely viewed in the market. Overall, the market was relatively quiet with fewer contract of affreightment (COA) nominations, putting downward pressure on rates as more space has become available. On the bunker side, fuel prices have declined as well, on the back of lower energy prices, as a result week over week were softer. Additional reporting by Kevin Callahan Visit the US tariffs, policy – impact on chemicals and energy topic page Visit the Logistics: Impact on chemicals and energy topic page

23-May-2025

SINGAPORE (ICIS)– ChemOne Group is planning to incorporate bionaphtha as a feedstock for its upcoming $5.3 billion Pengerang Energy Complex (PEC) in Johor, Malaysia, a senior company executive said. The PEC is expected to process 150,000 barrels/day of condensate plus a side feed of naphtha, that will in turn produce 2.5 million tonnes/year of aromatics, 3.8 million tonnes/year of energy products output, and hydrogen output of 26,000 tonnes/year, according to Mobin Rahman, ChemOne Group’s Vice President for Technology. Construction of the PEC project is expected to start by mid-2025 after its operator secured an agreement for $3.5 billion of financing, with the start-up of the complex expected in Q4 2028. The hydrogen produced will be used to support the production of hydrogenated vegetable oil (HVO), which in turn can be processed into sustainable bionaphtha, according to Rahman. “The incorporation of bionaphtha as a feedstock in PEC will then advance ChemOne's work in creating a sustainable, circular petrochemical chain,” he said. Bionaphtha, a byproduct of HVO and sustainable aviation fuel (SAF) production, is increasingly used in Asia's petrochemical industry for sustainable plastics, packaging, and fuel blending. “The petrochemical industry globally is heavily reliant on fossil-based naphtha as a feedstock in steam crackers to produce olefins. Bionaphtha thus presents itself as a renewable alternative to fossil-based naphtha,” Rahman said. “This signals the potential for greater integration of bionaphtha into the petrochemical industry as its technology matures and supply increases,” Rahman noted. However, its relatively higher cost as compared to conventional fossil-based naphtha makes its adoption limited. Moreover, converting bionaphtha to paraxylene (PX) through catalytic reforming is challenging primarily due to the feedstock's composition and the inherent limitations of the process. Bionaphtha, derived from bio-crude oils, often contains a high proportion of normal paraffins and other non-aromatic components, which are difficult for catalytic reforming to convert into aromatics. BIONAPHTHA USE IN ASIA INCREASING   Major petrochemical companies in Asia are incorporating bionaphtha in their steam crackers as a drop-in feedstock in place of fossil-based naphtha, or in a mix with fossil-based material to produce partially renewable chemicals. “As a region that consumes the most plastics globally, the demand for plastics remains constantly high,” Rahman said. “When coupled with the increasing eco-conscious preferences among consumers, we see a resulting heightened demand for bioplastics. This has, as such, been a significant driver in the region's demand for bionaphtha as a feedstock for its production.” In line with the global green transition, multiple countries in Asia have also enacted fuel blending mandates. Singapore, for example, has set a 1% SAF blending mandate from 2026 onwards. Given the current mandate by countries to ensure that SAF is blended with jet fuel, the production of SAF, and consequently the use and production of bionaphtha, is set to rise, Rahman said. The International Air Transport Association (IATA) estimates that SAF could contribute to a 65% reduction in emissions, much needed by the aviation industry to achieve net zero emissions by 2050. Just like fossil-based naphtha, bionaphtha can also be used as a gasoline blending component – offering a more sustainable fuel blend to help countries and companies achieve their decarbonization goals, according to Rahman. While carbon capture & storage (CCS) and green hydrogen also offer valuable decarbonization strategies, bionaphtha provides a relatively easier and expected to be more readily available pathway. “Looking ahead, the global momentum towards sustainability will likely continue to see an increasing demand for bionaphtha in petrochemical production processes.” BIOPLASTICS USE GROWING One of the most promising downstream applications for bionaphtha lies in bioplastics, Rahman noted, including polyethylene furanoate (PEF), bio-polyethylene (bio-PE) and bio-propylene (bio-PP). PEF is a fully bio-based alternative to PET, while bio-PE and bio-PP are drop-in biopolymers with varying levels of bio-content, with bio-PP currently achieving up to 40% through the bio-mass balance process. In South Korea and Japan, leading beauty brands are already incorporating bio-naphtha into packaging and product development, setting a precedent for other industries to follow, Rahman noted. Companies like Japanese producer Nippon Shokubai and Indonesia’s Chandra Asri are exploring the use of bionaphtha in super absorbent polymer production (SAP), utilizing mass balance processes and independent certification bodies to ensure transparency and sustainability. South Korea’s LG Chem has also been manufacturing eco-friendly plastic products using bio-naphtha since 2020. LG Chem since 2021 has been shipping its bio-balanced SAP products – also certified with ISCC Plus – to overseas markets. ISCC PLUS is an international certification system that verifies the sustainability of bio-based and bio-circular raw materials throughout the supply chain. Separately, Mitsubishi Chemical has partnered with Japanese beverage company Suntory and apparel manufacturer Goldwin to use sustainable plastics for their end-products. The conglomerate also locked in partnerships with providers of the key bioplastics ingredient bionaphtha. It announced a strategic partnership with Finnish company Neste for the bioplastics supply chain. SUSTAINABILITY MANDATES TO PLAY KEY ROLE  Regulatory frameworks and sustainability mandates play a significant role in accelerating the adoption of bionaphtha, Rahman said. “Policies surrounding the reduction of plastic waste – like Japan's Plastic Resource Circulation Act for example – can incentivise manufacturers to adopt more sustainable production materials, while also encouraging retailers and consumers to opt for biobased plastics as an alternative to single-use plastics.” “In addition to that six other Asian governments – Philippines, China, South Korea, India, Bangladesh, and Malaysia – are regulating plastic waste, thereby building a potential market for biobased alternatives.” Other regulatory frameworks surrounding the general reduction of carbon emissions also help drive the adoption of bionaphtha in the petrochemical sector, as companies seek to harness potential financial incentives and avoid regulatory penalties, Rahman noted. “Take for example carbon taxes implemented in countries like Singapore, with carbon tax rates that will increase at least thrice within the decade to reach $80 per tonne of GHG [greenhouse gas] by 2030,” he noted. “Companies looking to comply with such regulatory requirements, or to be eligible for carbon credits and offsets, may turn towards bionaphtha to help reduce lifecycle greenhouse gas emissions along the supply chain.” South Korea's emission trading scheme also specifically rewards companies that integrate renewable feedstocks into their petrochemical production, providing a financial incentive for the adoption of bionaphtha in the industry, Rahman added. BIONAPHTHA MARKET SET FOR RAPID GROWTH  The market size for bionaphtha continues to expand at a compounded annual growth rate (CAGR) of 19% and is projected to reach more than 3 million tonnes by 2032, according to Rahman. The expansion is due to increased environmental awareness, policies that encourage the use of sustainable energy, and improvements in production technology, he said. “Currently, about 15% of sustainable aviation fuel (SAF) production results in bio-naphtha as a byproduct. If demand continues to rise, this ratio can be increased to 40%, but the industry must also grapple with the limited availability of bio-based raw materials such as waste cooking oil.” “To ensure long-term viability, diversification of feedstock sources and the development of alternative production methods are imperative.” COST COMPETITIVENESS REMAINS AN ISSUEThe key challenge for bionaphtha revolves around cost competitiveness, and this is especially pertinent for Asian petrochemical producers who operate on thinner margins compared to their Middle East and US counterparts who benefit from cheaper feedstocks, according to Rahman. “Investing in low-carbon technologies is difficult for Asian producers if it further erodes their profit margins,” he said. “Besides, in terms of feedstock, while bio-based alternatives such as bionaphtha are available, many petrochemical complexes still rely on fossil-based naphtha.” “This is due to the comparatively higher prices of its alternatives, limited supplies depending on international supply chains, as well as potentially incompatible infrastructure where retrofitting is too costly.” Steam cracking operates at temperatures above 800°C and consumes large amounts of energy. This is mostly powered by fossil fuels, as its alternative – the electrification of steam crackers, requires high-capacity renewable energy that is not cost-competitive in Asia at the moment. “Even if high-capacity renewable energy becomes more accessible, the electrification of steam crackers requires a complete redesign or a retrofit that would incur very high costs. As such, decarbonizing these steam crackers poses significant technical and economic hurdles for businesses,” Rahman said. TECHNOLOGY TO THE RESCUETechnological advancements – like the introduction of new hydrotreating catalysts, help to improve conversion efficiency and reduce coke formation, according to Rahman. Other innovations like mild hydrocracking configurations that allow for targeted production of bionaphtha fractions can also enhance the overall efficiency of bionaphtha production, he said. More importantly, however, advancements that allow for better hydrogen recovery are particularly crucial in enhancing both the scalability and efficiency of bionaphtha production. “Especially in complexes like ChemOne Group's PEC, where hydrogen is produced as a by-product and used in the downstream production of hydrogenated vegetable oils, embedding strong hydrogen recovery systems can help improve yield efficiency and reduce costs. This in turn better primes its production for scalability,” he said. “In addition, at ChemOne Group's Pengerang Energy Complex, engineering-driven improvements in its LD-PAREX technology have yielded an almost 10% increase in conversion percentage from its Condensate Feedstocks to its higher value aromatics products,” Rahman said. “This also enhances the efficiency of downstream SAF/bionaphtha production and thereby improves production economics, both of which enhance the supply and cost appeal to facilitate further scaling of bionaphtha production.” Interview article by Nurluqman Suratman

22-May-2025

SINGAPORE (ICIS)–Taiwan's ethylene crackers are expected to run at 60-70% of capacity on average this year amid heightened regional competition and weak downstream demand, according to the Petrochemical Industry Association of Taiwan (PIAT). Economic uncertainty, US tariffs and geopolitical risk are pressure points for the industry, the industry body said in a report released at the Asia Petrochemical Industry Conference (APIC) 2025 on 15-16 May in Bangkok. Taiwan’s ethylene capacity is about 4.0 million tonnes; while its propylene capacity is about 3.4 million tonnes, according to PIAT. Despite a potential short-term rebound in prices for Taiwan’s petrochemical sector in 2025, continued capacity extensions in China will “intensify market price competition”, PIAT said. For 2025, it forecasts a 2.7% growth for both supply and demand of ethylene, with a projected 61% surge in exports. Propylene, on the other hand, is expected to post a 2.2% contraction in both supply and demand, with exports expected to more than double. Ethylene (in tonnes) 2024 2025 (estimated) change Supply Production 2,596,243 2,650,000 2.1% Import 228,176 250,000 9.6% Total 2,824,419 2,900,000 2.7% Demand Domestic 2,818,820 2,891,000 2.6% Export 5,599 9,000 60.8% Total 2,824,419 2,900,000 2.7% Year End Capacity (tonnes/year) 4,005,000 4,005,000  Propylene (in tonnes) 2024 2025 (estimated) change Supply Production 2,315,130 2,363,700 2.1% Import 309,100 202,600 -34.5% Total 2,624,230 2,566,300 -2.2% Demand Domestic 2,566,418 2,400,500 -6.5% Export 57,812 165,800 186.8% Total 2,624,230 2,566,300 -2.2% Year End Capacity (tonnes/year) 3,370,500 3,370,500 Source: PIAT China is expected to increase its 2025 ethylene capacity by approximately 7.8 million tonnes, or by 15%, to 60.99 million tonnes. But ethylene derivative consumption is expected to grow at a slower rate of 12.6%, and ethylene demand is expected to rise by just 6%, PIAT said, posing a challenge for neighboring suppliers that have historically relied on exports to China. Taiwanese producers have either reduced operating rates or remained idle over the past three years, while ethylene exports to China dropped to zero last year. “Given weak downstream demand and regional competition, cracker utilization rates are expected to average 60%-70% in 2025,” PIAT said in the report. Meanwhile, Taiwan’s demand for propylene is expected to weaken further due to weak downstream demand, particularly for polypropylene (PP) and epichlorohydrin (ECH). China's ongoing capacity expansion also continues to pressure Taiwanese producers, said the PIAT. Since 2024, Taiwan’s propylene exports to China have been subject to tariffs, posing a challenge for accessing the Chinese market. According to PIAT data, major petrochemical production dropped 2.39%, exports were down by 4.3% and demand fell by 1.1% in 2024 from the previous year. Visit the ICIS Topic Page: US tariffs, policy – impact on chemicals and energy. Thumbnail image At the port city of Keelung, Taiwan on 20 March 2025. (RITCHIE B TONGO/EPA-EFE/Shutterstock)

19-May-2025

HOUSTON (ICIS)–Asia-US container rates surged this week as trade between the US and China is expected to surge amid the 90-pause on reciprocal tariffs between the two nations. Rates from online freight shipping marketplace and platform provider Freightos showed minimal increases in the low-single digits, but rates from supply chain advisors Drewry showed significant increases of 19% from Shanghai to New York and 16% from Shanghai to Los Angeles, as shown in the following chart. Following the latest US–China trade developments, Drewry expects an increase in Transpacific spot rates in the coming week due to shortage in capacity. Peter Sand, chief analyst at ocean and freight rate analytics firm Xeneta, said the 90-day pause is expected to lead to a surge of activity, where spot rates will peak and then flatten as carriers redeploy capacity to match demand over the next two to four weeks. “The US-China announcement on the temporary lowering of tariffs fired the starting gun for shippers to rush as many imports as they can during the 90-day window of opportunity,” Sand said. “There is no time to waste for these shippers and the rush of cargo will put upward pressure on spot rates on Transpacific trades.” But Sand said that a deeper dive into data shows shippers paying prices towards the market mid-high for rates agreed post the US-China announcement, while legacy agreements struck before 12 May will continue to keep a lid on the bubbling market averages for a short time. The following chart shows Xeneta’s rates from North China to the US Gulf. Judah Levine, head of research at Freightos, also expects to see a surge in imports. “We are likely to see a significant demand rebound in the near term as shippers replenish inventories that may have started to run down in the past month and as many Chinese manufacturers have high levels of finished goods already ready to ship,” Levine said. With an August deadline for the possible return of higher tariff levels, it is also likely that the near-term ocean demand rebound will mark the start of more frontloading, Levine said. “If so, it would also mark the early start of this year’s peak season, which could end earlier than usual as well for the same reasons,” Levine said. TANKER RATES STABLE TO LOWER US chemical tanker freight rates assessed by ICIS were stable to lower this week with rates for parcels from the US Gulf (USG) to Asia dropping once again. Rates from the USG to Asia ticked lower both for smaller parcels and larger parcels. Overall, market activity is weaker for most destinations to Asian ports, prompting owners to reposition tonnage to bridge the gap between southeast Asia and northern destinations. Overall, along this route there is very little quoted, aside from the usual contract of affreightment (COA) volumes there has not been much activity, besides the usual methanol and monoethylene glycol (MEG) cargoes. From the USG to Brazil, the market COA volumes remain steady as there were some inquiries and much less space is available for May for part cargoes, as COA nominations appear completed for the month. According to one ship broker, “owners are reporting very limited parcel space available”. The usual mix of caustic soda and methanol seems to be most visibly seen quoted in the market. For the USG to Rotterdam, there are some bits of cargo space still available for May. Most of the outsider vessels that were on berth have already sailed, and only the regulars remain at this time as they push tonnage availability which is all but full. However, there were steadier quotes styrene, methanol and caustic seen in the market this week for June loadings. Freight rates are now expected to remain steady for the time being. With additional reporting by Kevin Callahan Visit the US tariffs, policy – impact on chemicals and energy topic page Visit the Logistics: Impact on chemicals and energy topic page

16-May-2025