Mono propylene glycol (MPG)

BARCELONA (ICIS)–Europe’s chemical distribution sector is bracing for the impact of multiple geopolitical and economic challenges, including the Israel/Iran conflict. All Iran’s monoethylene glycol (MEG), urea, ammonia and methanol facilities have been shut down For methanol this represents more than 9% of global capacity, for MEG it is 3% Brent crude spiked from $65/bb to almost $75/bbl, against backdrop of reports of attacks on gas fields and oil infrastructure If Iran closes the Strait of Hormuz this will severely disrupt oil and LNG markets Expect extended period of volatility and instability in the Middle East European distributors brace for a VUCA (volatile, uncertain, complex, ambiguous) world Prolonged period of poor demand looms, with no sign of an upturn Global overcapacity driven by China, subsequent wave of production closures across Europe both a threat and opportunity for distributors Suppliers and customers turn to distributors to help navigate impact of tariffs and geopolitical disruption In this Think Tank podcast, Will Beacham interviews Dorothee Arns, director general of the European Association of Chemical Distributors and Paul Hodges, chairman of New Normal Consulting. Click here to download the 2025 ICIS Top 100 Chemical Distributors listing Editor’s note: This podcast is an opinion piece. The views expressed are those of the presenter and interviewees, and do not necessarily represent those of ICIS. ICIS is organising regular updates to help the industry understand current market trends. Register here . Read the latest issue of ICIS Chemical Business. Read Paul Hodges and John Richardson's ICIS blogs.

17-Jun-2025

SINGAPORE (ICIS)–Malaysia's revised sales and services tax (SST) framework officially takes effect on 1 July, with the expanded scope now set to include a 5% tax on an extensive range of petrochemical products, including polyethylene (PE) and polypropylene (PP). Critical raw materials for downstream industries affected Capital expenditure items like machinery now taxed Malaysian industry body calls for further delay in implementation The government had first announced the revision of items subject to the sales tax on 18 October 2024, as part of its fiscal consolidation strategy under the 2025 budget. Under the updated framework, more than 4,800 harmonized system (HS) codes will now fall under the 5% sales tax bracket. Goods exempted from the updated sales tax include specific petroleum gases and other gaseous hydrocarbons that are currently under HS code 27.11. These include liquefied propane, butanes, ethylene, propylene, butylene, and butadiene. In their gaseous state, the list includes natural gas used as motor fuel. The measure, aimed at broadening the country's tax base and increasing revenue, was originally slated to begin on 1 May, but was delayed for two months after manufacturers urged policymakers to refrain from adding to their financial burden. The July revision of Malaysia's sales tax and the expansion of the service tax scope involve several key changes. The sales tax rate for essential goods consumed by the public will remain unchanged, while a 5% or 10% sales tax will be applied to discretionary and non-essential goods. The scope of the service tax will be broadened to include new services such as leasing or rental, construction, financial services, private healthcare, education, and beauty services. This includes critical raw materials for various downstream industries, from plastics and packaging to automotive manufacturing. Previously, many of these materials were zero-rated under the SST. The Federation of Malaysian Manufacturers (FMM) has publicly criticized the decision, calling it "highly damaging to industries” in a statement released on 12 June. According to estimates by the Ministry of Finance, the SST expansion is expected to generate around ringgit (M$) 5 billion in additional government revenue in 2025. “Although this may support the government’s fiscal objectives, the additional tax burden will be largely borne by businesses and has serious implications for operating costs, investment decisions, and long-term business sustainability,” FMM president Soh Thian Lai said in a statement. Soh highlighted that with this expansion, around 97% of goods in Malaysia's tariff system will now be subject to sales tax, representing a significant departure from a previously narrower tax base, to one where nearly all categories including industrial and commercial inputs are now taxable. Under the new sales tax order, 4,806 tariff lines are now subject to 5% tax, covering a wide range of previously exempt goods, according to the FMM. These include high-value food items, as well as a broad spectrum of industrial goods, such as industrial machinery and mechanical appliances, electrical equipment, pumps, compressors, boilers, conveyors, and furnaces used in manufacturing processes, it said. The 5% rate also applies to tools and apparatus for chemical, electrical, and technical operations, significantly broadening the range of taxable inputs used in production and operations. “The expanded scope now places a direct tax burden on machinery and equipment typically classified as capital expenditure. This includes items critical to upgrading production lines, automating processes, and scaling operations,” Soh said. The FMM "strongly urges the government to further delay the enforcement of the expanded SST scope beyond the scheduled date of 1 July", until the review is complete, and industries are ready. They also calling for a broader exemption list, especially for capital expenditure items like machinery and equipment, and a re-evaluation of including construction, leasing, and rental services, which they warn will "increase operational expenses and are expected to cascade through supply chains." “We are deeply concerned and caution that the untimely implementation of the expanded scope of taxes will exert inflationary pressure, as businesses already grappling with rising costs … may have no choice but to pass these additional burdens on to consumers,” the FMM added. The FMM has urged the government to postpone the implementation, citing insufficient lead time for businesses to adapt and calling for a comprehensive economic impact assessment. Malaysia’s manufacturing purchasing managers’ index (PMI) continued to contract in May, with a reading of 48.8, according to financial services provider S&P Global. Beyond the direct sales tax on goods, the revised SST also introduces an 8% service tax on leasing and rental services for commercial or business goods and premises. This could further compound cost burdens for capital-intensive sectors, including parts of the petrochemical industry that rely on leased machinery and industrial facilities. Focus article by Nurluqman Suratman Thumbnail image: PETRONAS Towers, Kuala Lumpur (Sunbird Images/imageBROKER/Shutterstock)

17-Jun-2025

SINGAPORE (ICIS)–Here are the top stories from ICIS News Asia and the Middle East for the week ended 13 June 2025. Asia-Europe VAM trade expansion driven by outages, US tariffs By Hwee Hwee Tan 13-Jun-25 15:01 SINGAPORE (ICIS)–Vinyl acetate monomer exports from Asia to Europe are on track for expansion during the second quarter, spurred by a push among traders to take positions before a regulatory quota waiving duties for imports into Europe is exhausted. Crude climbs more than 8% after Israeli strikes against targets in Iran By James Dennis 13-Jun-25 12:33 SINGAPORE (ICIS)–Crude prices surged, with Brent peaking nearly $9/barrel higher early on Friday, after Israel attacked targets in Iran, raising fears of a major escalation in conflict in the Middle East and resultant disruptions to crude production and exports from that region. INSIGHT: India’s BIS deadline may reshape global PVC trade landscape By Aswin Kondapally 11-Jun-25 14:00 MUMBAI (ICIS)–India is at a critical juncture in determining whether to implement or extend its Quality Control Orders (QCO) for polyvinyl chloride (PVC) resin sales under the Bureau of Indian Standards (BIS) Act, with the compliance deadline set for 24 June 2025. Asia crude glycerine offers fall as downstream ECH weakens in China By Helen Yan 12-Jun-25 11:42 SINGAPORE (ICIS)–Offers for crude glycerine in Asia declined, weighed down by weakness in downstream epichlorohydrin (ECH) market and bearish sentiment. ICIS China Petrochemical Price index May average falls on weak demand By Yvonne Shi 11-Jun-25 13:48 SINGAPORE (ICIS)–China's average petrochemical prices in May eased by 0.62% month on month as easing trade war concerns was offset by continued weakness in demand. Indian refineries plan green hydrogen projects worth Rs2 trillion By Priya Jestin 11-Jun-25 12:24 MUMBAI (ICIS)–India is currently planning green hydrogen initiatives worth around Indian rupees (Rs) 2 trillion ($23 billion), which include tenders for 42,000 tonne/year green hydrogen production by domestic oil refineries. INSIGHT: India’s BIS deadline may reshape global PVC trade landscape By Aswin Kondapally 11-Jun-25 14:00 MUMBAI (ICIS)–India is at a critical juncture in determining whether to implement or extend its Quality Control Orders (QCO) for polyvinyl chloride (PVC) resin sales under the Bureau of Indian Standards (BIS) Act, with the compliance deadline set for 24 June 2025. China vessel age limit stalls prompt trades with India By Hwee Hwee Tan 11-Jun-25 13:04 SINGAPORE (ICIS)–Prompt chemical tanker supply on China’s southbound trade lanes is expected to shrink following regulatory restrictions, constraining spot trades especially with India. INSIGHT: Hydrogen unlocking China's cement decarbonization potential By Patricia Tao 10-Jun-25 17:58 As China steps up efforts to meet its dual carbon targets, hydrogen is becoming a practical and strategic tool to cut emissions from the country’s highly carbon-intensive cement industry. INSIGHT: Countdown to China benzene futures debut: how will it affect the market? By Jenny Yi 10-Jun-25 17:11 SINGAPORE (ICIS)–On 14 May, the Dalian Commodity Exchange (DCE) issued a notice to solicit public opinions on proposed futures and options contracts for benzene along with the relevant rules. The deadline for feedback was 21 May 2025, marking the countdown to the launch of benzene futures and options in China. China's US exports to rebound on front-loading before Aug By Nurluqman Suratman 10-Jun-25 13:49 SINGAPORE (ICIS)–China's exports to the US are expected to rebound in June as exporters ramp up frontloading efforts before the 90-day trade truce between the two global economic superpowers expires in August. Asia, Mideast petrochemical markets brace for tough summer By Jonathan Yee 09-Jun-25 11:16 SINGAPORE (ICIS)–Tariff concerns and ample supply continue to exert pressure on petrochemical markets in both Asia and the Middle East, with regional demand staying weak, with consumption in India unlikely to pick up until September. INSIGHT: China polyester sector sees production cuts; tight supply boosts PTA/MEG By Cindy Qiu 09-Jun-25 12:00 SINGAPORE (ICIS)–China’s polyester producers are facing mounting cost pressure, as domestic purified terephthalic acid (PTA) and monoethylene glycol (MEG) prices reaped large gains after the Labour Day holiday (1-5 May 2025) on the back of tight supply.

16-Jun-2025

HOUSTON (ICIS)–US railroad Norfolk Southern has advised customers that it will increase demurrage and storage charges for railcars in its yards to $110/railcar from $60/railcar, according to a customer notice on its website. The notice said that there will be no changes made to the existing service credit program. “This adjustment reflects our ongoing commitment to maintaining a safe, efficient, and reliable service – particularly in the handling and transport of hazardous materials,” the railroad said. Norfolk Southern said the increase will help support enhancements to the fluid movement of cargo. “A fluid, well-optimized network ensures that shipments move more predictably and reliably, minimizing delays and maximizing the availability of equipment when and where it’s needed most,” the railroad said. Some market participants suspect that other railroads could follow with similar increases on growing concerns of stagnant inventory on rail networks. DELAYS SEEN FROM CPKC CUTOVERChemical market participants on the CPKC system saw significant delays moving material in east Texas, Louisiana, and parts of Mississippi in May because of issues merging its operations system following the merger between Canadian pacific and Kansas City Southern in 2023. Speaking at the Wells Fargo Industrials & Materials Conference on Tuesday, CPKC chief operating officer Mark Redd acknowledged that there were issues with the cutover in those areas. Redd said some customers felt the brunt of some first-mile/last-mile customer service during the cutover. A market participant told ICIS that the issue caused delays and impacted shipments severely and affected the tracking of ethylene glycol (EG) shipments.

12-Jun-2025

HOUSTON (ICIS)–Rates for shipping containers from Asia to the US spiked again this week – and have almost doubled over the past four weeks – as demand has surged ahead of the possible reinstatement of tariffs while capacity remains tight. Supply chain advisors Drewry said the latest sudden, short-term strengthening in supply-demand balance in global container shipping has reversed the trend of declining rates which had started in January. Rates from Shanghai to Los Angeles spiked by 57% this week while rates from Shanghai to New York jumped by 39%, according to Drewry and as shown in the following chart. The drastic increases are seen from other shipping analysts as well. On the Shanghai Containerized Freight Index (SCFI), the Shanghai-USWC rate rose by 58% to $5,172/FEU (40-foot equivalent unit), the largest week-on-week percentage gain since 2016 as strong demand has coincided with tight supply, though capacity is increasing as carriers resume previously suspended services and reinstate blank sailings. Sea-Intelligence CEO Alan Murphy said almost 400,000 TEUs (20-foot equivalent units) are coming back online in the near term. “If we aggregate it across June/July for Asia-USWC, then in June, the lines are increasing capacity 12.8% compared to before the tariff pause, and in July, the capacity injection is increasing to 16.5% compared to the pre-pause situation,” Murphy said. “Capacity has also ramped up sharply compared to just a week ago, with this injection of capacity equaling 397,000 TEU across the two months.” The growth in capacity is shown in the following chart from Sea-Intelligence. Peter Sand, chief analyst at ocean and freight rate analytics firm Xeneta, said the spike is likely because shippers are so concerned about getting goods moving during the 90-day window that they are willing to pay more. “Right now, it seems carriers are telling shippers to jump, and some are replying ‘how high?’,” Sand said. “This will not last because capacity is heading back to the transpacific and the desperation of shippers to get supply chains moving again will ease once boxes are on the water and inventories begin to build up,” Sand said. “Spot rates are expected to peak in June before downward pressure returns.” Rates from online freight shipping marketplace and platform provider Freightos have yet to capture the dramatic increase, but Judah Levine, head of research at the company, said 1 June general rate increases (GRIs) are starting to push daily prices up sharply. “Rates have spiked 72% to the West Coast since last week to $4,765/FEU and 44% to the East Coast to $5,721/FEU, with more increases likely and additional hikes announced for mid-month,” Levine said. Analysts at US logistics platform provider Flexport said they expect a further rush of cargo from southeast Asia to the US West Coast toward the end of June. Flexport analysts expect carriers to be back to full capacity on the transpacific eastbound trade lane by the end of June, noting that week 23 capacity is 11% below standard levels but is expected to exceed standard levels by 3% by week 25. 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 US chemical tanker freight rates assessed by ICIS were mostly unchanged. However, rates decreased from the US Gulf to Europe. The USG to Rotterdam route is overall steady as weaker demand is being offset by limited availability, particularly for larger parcels. Larger requirements are well represented, with several larger lots of methanol, methyl tertiary butyl ether (MTBE) and caustic soda fixed or indicated to the ARA. There was also some interest in sending some smaller lots of glycols and styrene. From the USG to Asia, the uptick in interest to rush glycols to beat the deadline to China seems to have all but ended as the market saw only a few new inquiries. On the other hand, several larger parcels of methanol were either fixed or quoted to the region. As contract of affreightment (COA) volumes are being firmed, and due to the absence of market participants, freight rates have eased some, with more downward pressure on smaller parcels. On the USG to Brazil trade lane, the market has been steady, leading rates to remain unchanged week on week. There was a stable level of spot activity with only a handful of new requirements. Overall, the market remains slow despite several cargoes being quoted and fixed. Despite the uptick in inquiries there is not enough significant activity that would suggest any increase in demand, with caustic soda, glycols and styrene the most active. The regular owners have space remaining and are trying to fill space while supporting current freight levels. Activity typically picks up during summer months, but this is not currently being seen. As a result, freight rates are now expected to remain steady for the time being. Focus story by Adam Yanelli 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

05-Jun-2025

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