Polycarbonate (PC)

SINGAPORE (ICIS)–Click here to see the latest blog post on Asian Chemical Connections by John Richardson: As delegates gather for this year’s Gulf Petrochemicals and Chemicals Association (GPCA) in Oman, front-of-mind will, of course, be the global trading environment. Is the world willing or able to continue to absorb China’s manufacturing surpluses, including in chemicals and polymers as today’s post discusses? The ICIS data suggest there is nothing new in China dominating global capacities in polymers such as polyester fibres and PVC (although as China moves up the chemicals value chains, its dominance of EVA  and polycarbonate is new). But historic context is everything. In 2001-2021, trade tensions between the rest of the world and China were not where they are today. The world felt more able to accommodate China’s dominance of chemicals and other manufacturing value chains. We, of course, need to consider the implications of Donald Trump’s election victory and the EU’s growing concern over what it sees as Chinese overcapacity. A 29 November South China Morning Post article wrote as follows: The EU’s civil service [last week] flew officials and experts in, at von der Leyen’s personal invitation, from around Europe and the United States for a full day devoted to Chinese overcapacity – an issue former trade chief Valdis Dombrovskis described as a “significant threat”. “From steel and solar panels to shipbuilding and the automotive industry – this is not an abstract challenge, it is reality. And for many businesses, both in Europe and within our partners, it is an existential challenge,” Dombrovskis said. You can talk as much as you like about cost-per-tonne economics and about feedstock advantage, but it won’t get you very far in this post-Chemicals Supercycle world. Today’s blog is another example of why we need to broaden our analysis out to include a wide range of big picture factors that will shape the global chemicals industry. In this case, you need to build a matrix of countries, companies and chemicals products and then determine scenarios for the effect on all three of a much more uncertain global trading environment. 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.

02-Dec-2024

SINGAPORE (ICIS)–Here are the top stories from ICIS News Asia and the Middle East for the week ended 22 November. Bearish sentiment in Asian naphtha market likely short-lived By Li Peng Seng 18-Nov-24 11:46 SINGAPORE (ICIS)–Asia's naphtha market sentiment nosedived last week amid bearish pressures, but cracker expansion in South Korea and gasoline demand ahead of a festive season will likely buoy up demand. Thai PTTGC plans $840 million 5-year capex; focus on Allnex growth By Jonathan Yee 18-Nov-24 17:12 SINGAPORE (ICIS)–Thai chemicals producer PTT Global Chemical plans capital expenditure (capex) of $840 million in the next five years, more than 78% of which will be invested to grow its Germany-based specialty chemicals subsidiary Allnex. INSIGHT: Most Asia petrochemical markets to post Nov losses By Lina Xu 18-Nov-24 15:55 SINGAPORE (ICIS)–Most petrochemical markets in Asia are expected to register losses in November on slowing demand as the year draws to a close. China's PC market faces ongoing supply pressure By Li Peng Seng 19-Nov-24 11:42 SINGAPORE (ICIS)–China's polycarbonate (PC) import market is likely to remain under pressure due to persistent oversupply, trade conflicts and geopolitical uncertainties. Asia caustic soda unlikely to see immediate impact from China’s removal of aluminium export tax rebates By Jonathan Chou 20-Nov-24 12:30 SINGAPORE (ICIS)–China's announcement to end export tax rebates on aluminium effective on 1 December may have limited long-term changes in caustic soda’s demand and supply conditions in Asia. SE Asia bottlenecks disrupt regional chemical tanker operations By Hwee Hwee Tan 21-Nov-24 11:57 SINGAPORE (ICIS)–Persistent delays in tanker operations in southeast Asia are snowballing into wider vessel schedule disruptions across intra-Asia trade lanes. More stringent regulations to hamper Asia’s rPET exports By Arianne Perez 22-Nov-24 14:20 SINGAPORE (ICIS)–Major producers of high-value recycled polyethylene terephthalate (rPET) flakes and pellets from Asia continue to aim for a growing market share in premium markets including the Americas and Europe.

25-Nov-2024

SINGAPORE (ICIS)–Here are the top stories from ICIS News Asia and the Middle East for the week ended 25 October. Asia's naphtha market eyes demand uptick By Li Peng Seng 21-Oct-24 11:38 SINGAPORE (ICIS)–Asia's naphtha intermonth spread was near a two-month high recently and it may be able to hold firm in the near term on reduced arbitrage volumes in November and anticipated demand growth ahead. Energy transition plan reset needed with renewed focus on Asia – Aramco President By Jonathan Yee 21-Oct-24 14:22 SINGAPORE (ICIS)–Saudi Aramco chief Amin Nasser on Monday called for a new energy transition plan that considers the needs of all countries, specifically those in Asia and the broader Global South, amid growing oil demand. Asia ACN regional producers bullish on tighter supply; India’s BIS deadline nears By Corey Chew 22-Oct-24 11:07 SINGAPORE (ICIS)–Asia acrylonitrile (ACN) prices saw a recent uptrend the past two weeks, with plants of key regional producers in Taiwan and South Korea under planned maintenance. PODCAST: Macroeconomic pressure continues to weigh on Asia recycling sentiment By Damini Dabholkar 22-Oct-24 17:13 SINGAPORE (ICIS)–The short-term demand outlook for recycled polymers from Asia remains sluggish especially for low-value grades, mainly due to poor economics and brand users’ preference of cheaper virgin plastics. Emerging Asian economies’ strong growth to subside amid China slowdown – IMF By Nurluqman Suratman 23-Oct-24 12:07 SINGAPORE (ICIS)–Emerging Asian economies are expected to see strong economic growth subside, partly due to a sustained slowdown in China, the International Monetary Fund (IMF) said on Tuesday. PODCAST: Asia methanol impacted by geopolitical uncertainty, supply cuts expected in Q4 By Damini Dabholkar 24-Oct-24 23:00 SINGAPORE (ICIS)–Asian methanol markets in recent weeks were driven more by sentiment than changes in fundamentals as participants respond to an escalation of the conflict in the Middle East. However, some supply changes in coming months are expected to alter the landscape in Q1 2025. Supply glut casts shadow over Asia PC market recovery By Li Peng Seng 25-Oct-24 13:08 SINGAPORE (ICIS)–China's polycarbonates (PC) spot demand has remained sluggish as ample supplies have kept purchases on a need-to basis, and this trend will persist through yearend.

28-Oct-2024

LONDON (ICIS)–Weak demand continues to be a concern in the European acetone and phenol chain and in the wider chemicals industry and Q4 will remain tough, in view of year-end considerations, but when will demand turn a corner? Europe ICIS editors Jane Gibson (acetone and phenol), Heidi Finch (bisphenol A and epoxy resins), Meeta Ramnani (polycarbonate), Mathew Jolin-Beech (methyl methacrylate) and ICIS senior analyst Michele Bossi (aromatics and derivatives) discuss current market conditions, in particular demand challenges, in view of residual macro and geopolitical headwinds, although easing interest rates and the trade defense investigation for epoxy bring some hopes and opportunities in Europe. However, global oversupply driven by growing capacity in China, falling deep sea freight rates making imports more interesting again and the need for restructuring actions in PC and regulatory changes are just some of the challenges that the chain is facing. Demand fundamentally weak across markets; Q4 destocking on top Acetone/ phenol length to increase when turnarounds end, on poor demand Some hopes, but no big expectations of recovery for 2025 EU epoxy AD case could support more domestic sourcing in 2025 Global oversupply, Asian exports likely to continue to weigh on the chain Restructuring in Europe PC production BPA ban in food contact materials a blow, but widely expected/prepared for Podcast editing by Meeta Ramnani Podomatic Player Podomatic Player

25-Oct-2024

LONDON (ICIS)–Markets Editor Stephanie Wix is joined by Senior Editor Manager Vicky Ellis, markets reporter Meeta Ramnani, and Senior Analyst Jincy Varghese, as they discuss the key trends from the 29th Fakuma plastics processing trade fair in Friedrichshafen, Germany, in this latest ICIS podcast. They explore discussion topics heard at the event last week, from the highest concerns to the lowest expectations. They also explain the clash of pessimism and optimism between markets including acrylonitrile butadiene styrene (ABS), polycarbonate (PC), polyethylene (PE) and polypropylene (PP), and also engineering plastics polyacetal (POM) and polybutylene terephthalate (PBT).

22-Oct-2024

LONDON (ICIS)–Markets editor Stephanie Wix and reporter Meeta Ramnani join senior editor manager Vicky Ellis to pick out key themes ahead of the 29th Fakuma plastics processing trade fair in Germany, in this latest ICIS podcast. They discuss the clash of pessimism and optimism for acrylonitrile butadiene styrene (ABS), the changing European landscape for polycarbonate (PC) given ADNOC’s recent offer for Covestro, and pressure from cheap imports for PE and PP and engineering plastics polyacetal (POM) and polybutylene terephthalate (PBT). Fakuma runs from 15-19 October.

11-Oct-2024

LONDON (ICIS)–Here are some of the top stories from ICIS Europe for the week ended 4 October. No signs of petchems demand recovery from car sector on the horizon, H2 2025 may be a moment of truth After a strong rebound in car sales last year, the European automotive industry is facing a more challenging environment in the second half of 2024, leading to a drop in petrochemical requirements from car manufacturers. LANXESS exits polymers via sale of urethane business to Japan’s UBE LANXESS is selling its urethane systems business to Japanese chemicals producer UBE Corp for around €500 million, the German specialty chemicals firm said on Thursday. Europe recycled polyolefin agglomerates prices face downward pressure Europe recycled polyolefin agglomerate prices are facing downward pressure due to weak demand from mechanical recyclers. ADNOC makes public takeover offer for Germany’s Covestro Abu Dhabi state oil and petrochemicals player ADNOC has launched a public takeover offer for Germany-based producer isocyanates, polycarbonates and adhesives specialist Covestro, representing an equity value of €11.7 billion. Bold policy moves might not arrest China economic slowdown In a bold move to revitalize its economy and restore investor confidence, China unveiled a comprehensive package of monetary and fiscal measures less than a week before the country goes on a week-long holiday.

07-Oct-2024

BARCELONA (ICIS)–ADNOC’s agreement to buy Covestro ahead of next week’s European Petrochemical Association (EPCA) annual meeting highlights the challenges and opportunities facing Europe’s beleaguered chemical industry. Abu Dhabi National Oil Co (ADNOC) to acquire Covestro for equity value of €11.7 billion ADNOC diversifies downstream from oil and gas Covestro global leader in polycarbonate (PC) and polyurethanes (PU) PC and PU struggle with poor demand from automotive, construction Covestro operating profit slumped from around €3bn in 2021 to near €1bn in 2023 Covestro boasts strong sustainability-related product portfolio More M&A likely in Europe petrochemicals thanks to cheap bottom-of-cycle valuations Oil prices may collapse to $30/bbl if OPEC goes for market share In this Think Tank podcast, Will Beacham interviews Nigel Davis and John Richardson from the ICIS market development team and Paul Hodges, chairman of New Normal Consulting. 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.

01-Oct-2024

LONDON (ICIS)–Abu Dhabi state oil and petrochemicals player ADNOC has launched a public takeover offer for Germany-based producer isocyanates, polycarbonates and adhesives specialist Covestro, representing an equity value of €11.7 billion. After over a year of reports of a possible deal between the players and concrete negotiations that have been underway since June this year, the Emirati company made a concrete public takeover offer of €62 per share. The price represents a 21% premium to Covestro’s per-share value at the close on 23 June, when the company announced the beginning of due diligence procedures between the two companies. ADNOC estimates the enterprise value of the deal, which also includes net debt and pension obligations that would be taken on as a result of a purchase, at €14.7 billion. The company will also subscribe to new shares representing a 10% increase of Covestro’s share capital at the offer price, which will result in proceeds of €1.17 billion to be used to further the Leverkusen-based producer’s growth strategy. The company had not responded for requests for comment on whether that sum is part of the offer price or in addition to it at the time of publication. The deal is subject to a minimum acceptance threshold of 50% of Covestro’s issued share capital plus one share, with Covestro’s management and supervisory boards backing the deal. The joint investment agreement, which would stand until the end of 2028 if the deal goes through, ADNOC has committed not to sell, close, or significantly reduce Covestro’s business activities, and to abide by existing works agreements. “We are convinced that the agreement reached today with ADNOC International is in the best interest of Covestro, our employees, our shareholders, and all other stakeholders,” said Covestro CEO Markus Steilemann. The deal will play into ADNOC’s plan to diversify and build out its chemicals platform, according to CEO Sultan Adhem Al-Jaber. “This strategic partnership is a natural fit and aligns seamlessly with ADNOC’s ongoing smart growth and future proofing strategy and our vision to become a top five global chemicals company,” he said. If the takeover deal closes, Covestro will continue to be managed as a stock corporation, the company added. (Update re-leads, adds detail throughout) Thumbnail photo source: Covestro

01-Oct-2024

SINGAPORE (ICIS)–Click here to see the latest blog post on Asian Chemical Connections by John Richardson: The soundtrack of my youth was the Canadian rock band, Rush. In the fabulous Tom Sawyer, the lyrics include: “His mind is not for rent, always hopeful yet discontent, he knows changes aren't permanent, but change is”. Don’t let your mind be rented by anybody who tells you that the global chemicals industry isn’t going through the most profound set of changes in its modern-day history. Nobody knows all the details of the changes that will be permanent. Anybody who claims they do know will lead you down a path away from essential scenario planning. We do know that in this world of flux and chaos at a micro level, the following macro trends are here to stay: Sustainability, ageing populations across most of the G20, much more volatile geopolitics, ever greater economic, social and political disruptions caused by climate change and the end of debt bubbles. How will, for example, geopolitics and rising trade tensions reshape global polycarbonate (PC) trade flows, demand and trade flows? In today’s post,  I look at scenarios for China’s net imports or net exports of polycarbonate in 2024-2030 based on levels of trade tensions and its ability to export to third-party countries such as Mexico. These countries have become a means by which China is getting around the trade tensions by relocating export-focused manufacturing plants. The ICIS base case forecasts that China’s PC demand growth will fall to an annual average of 3% in 2024-2030 from 17% in 1992-2023. Assuming this 3% demand growth, capacity growth at 4% and an operating rate of just 47% in 2024-2030 (the 1992-2023 operating rate averaged 68%), ICIS forecasts that China’s PC net imports will be around 460,000 tonnes a year. Let’s imagine in a world of increased trade tensions, China decides it cannot afford to rely on large volumes of imports. Because of the trade tensions, it also cannot export significant quantities of PC to countries such as Mexico to make autos, etc. Under this outcome, let’s keep demand and capacity growth the same in the base case but raise operating rates to 55%. Average annual net imports fall to just 80,000 tonnes. What if, though, trade tensions are not that bad? If we again keep demand and capacity growth the same as the base case but raise the operating rate to 63%, China becomes a net exporter at an annual average of 460,000 tonnes between 2024 and 2030. I plan to attempt to build new demand and supply models today's demographic, geopolitical, debt, sustainability and climate change realities. This is going to be immensely difficult. Failure will be a big part of any success. But given today's events, do we have any other choice? 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.

13-Sep-2024