Engineering plastics (POM, PBT)

LONDON (ICIS)–Senior editor for recycling Matt Tudball discusses the latest developments in the European recycled polyethylene terephthalate (R-PET) market, including: Bullish outlook for eastern Europe bales and flake Upwards pressure appearing when market usually quietens down for summer Wider market expects bale supply to improve during August Outlook from September onwards still uncertain

19-Jul-2024

HOUSTON (ICIS)–The US chemical industry could see the return of some popular trade and chemical-safety programs later this year, and customers of the major railroads could get their first chance to switch carriers if they get bad service. The year is turning out to be a busy and potentially productive one despite the presidential election Key trade and security bills for the chemical industry could pass during the lame duck session, which falls between the November 5 election day and the January 20 inauguration Globally, the final round of negotiations for the UN plastics treaty should take place near the end of the year UN PLASTICS TREATYThe concern of the chemical industry is that the ratified plastic treaty could include caps or curbs on the production of plastic. Companies such as BASF have advocated that the treaty should focus on curbing pollution instead. Chemical companies have noted a growing consensus around the industry's views, leading them to be optimistic about the upcoming negotiations. The next round of talks is scheduled for November 25 through December 1 in Busan, South Korea. Formal ratification could take place in early 2025. RECRIPROCAL SWITCHING MAY GET FIRST TRIALReciprocal switching in the US will become effective in September, which will allow chemical companies to switch rail carriers if they can demonstrate substandard service. Reciprocal switching will be limited to Class 1 railroad companies, which are the biggest carriers. Redress for bad service is not automatic, and the process will require time, effort and legal fees on the part of chemical companies. "The question is how laborious and costly will that process be when you file a complaint?" said Eric Byer, president of the Alliance for Chemical Distribution (ACD) the new name for the National Association of Chemical Distributors (NACD). Still, it is possible that a chemical company upset with its rail service takes the plunge and files the first request for reciprocal switching. NEW RAIL BILL AND POSSIBLE TANK CAR BANA rail safety bill that passed the Senate shortly after the Norfolk Southern train derailment in Ohio state has recently received momentum that could push it into law. That momentum is coming from HR 8996, a sister bill that was introduced in the House of Representatives by Troy Nehls (Republican-Texas) and Seth Moulton (Democrat-Massachusetts). Related to the bill is a possible ban on DOT 111 tank cars. The ban is also connected to the derailment, since it is part of a settlement agreement between the US and Norfolk Southern. The agreement proposes that Norfolk Southern stop using its own DOT-111 tank cars and that it encourages its customers to do the same. The ACD is concerned that the agreement could be the first step in an outright ban of DOT 111 tank cars. Such a ban could take place before the industry has time to replace the tank cars. Hazardous materials would then be shipped by truck, which is more dangerous. A ban would also disrupt the movement of chemicals if it happens too quickly. REVIVAL OF CHEM SECURITY PROGRAMLegislators could revive the nation's main anti-terrorism program for chemical sites, which is known as the Chemical Facility Anti-Terrorism Standards (CFATS). CFATS has been inactive for about a year, after a bill that would have re-authorized it was blocked by US Senator Rand Paul (Republican-Kentucky). While CFATS has lost its authorization, it has not lost funding. Were Congress to re-authorize CFATS, employees who were associated with the program could be reassigned to it. Senators could attempt to revive CFATS through an amendment to the National Defense Authorization Act (NDAA), Byer said. That could happen later in September or during the lame duck legislative session, Byers said. Another tactic would add an amendment to the appropriations bill, he said. Congress will likely consider the appropriations bill during the lame duck session. REVIVAL OF TRADE PROGRAMSTwo trade programs popular with the chemical industry could also be revived during the lame duck session. The Generalised System of Preferences (GSP) expired at the end of 2020, and it eliminated duties on thousands of products from more than a 100 developing countries. Prior to its expiration, the GSP had existed for decades. Byer said a bill could bring back the GSP program and make it retroactive to January 1, 2021. If such a bill becomes law, companies would receive rebates for the taxes they paid while the GSP program was inactive. The GSP has typically been coupled with another expired trade program, known as the Miscellaneous Tariff Bill (MTB), Byer said. The MTB temporarily reduced or suspended import tariffs on specific products, and it could be packaged with any other legislative action that would revive the GSP. ELECTION SEASON TO LIMIT NEW BILLS, POLICIESOutside of the trade and security bills, Byer does not expect a lot of new legislation because of the elections. Similarly, the pace of new policies and rulemaking at federal agencies should slow down. Any regulatory relief would be a welcomed change because the first half of 2024 was the worst regulatory climate that the chemical industry has ever seen, Byer said. The regulatory climate could change after the elections on November 5. Otherwise, the chemical industry may have to turn to the courts to challenge policies that have a questionable basis and a harmful effect on companies. Insight article by Al Greenwood Thumbnail shows plastic waste. Image by HOTLI SIMANJUNTAK/EPA-EFE/Shutterstock

18-Jul-2024

MADRID (ICIS)–Colombia’s single-use plastic ban, which affects a wide range of products, kicks off amid some industry reluctance after a hurried implementation, and with provisions to revise the legislation after a one year trial period. The law that came into force on 7 July implemented a ban on eight plastics: carrier bags for packing supermarket purchases; bags for fruits and vegetables; plastic packing for magazines and newspapers; bags for storing clothes coming out of the laundry; plastic holders for balloons; cotton swabs; straws; and stirrers. The regulation establishes that those plastic products must be replaced by sustainable alternatives, such as biodegradable and compostable materials or recycled materials, or reusable non-plastic materials. It is a wide-ranging ban approved in parliament in 2022, although the plastics industry has criticized that details about the implementation of the law were only published at the end of June, barely two weeks before the kick-off date. Environmental groups have welcomed the measure, hoping more countries in Latin America will implement similar legislation in a region where plastics are omnipresent. MORE TO COMEApart from the eight plastic products banned from 7 July, the ban has set a transition period ranging from two to eight years, depending on the type of plastic, to allow merchants time to adapt to the new regulations. By 2030, plastics to be eliminated or transformed into reusable materials include containers, packaging, and bags for non pre-packaged liquids; disposable plates, trays, and cutlery; confetti, tablecloths, and streamers; containers, packaging, and bags for deliveries; sheets for serving or packaging foods for immediate consumption; wrappers for fruits and vegetables; stickers for fruits; handles for dental floss; and straws for containers of up to three liters. The law establishes exceptions for single-use plastics in certain cases, including exceptions for plastics used for medical purposes; packaging of biological or chemical waste; food products of animal origin; and those made with 100% recycled plastic raw material sourced from national post-consumer material. The regulation also mandates that public entities cannot acquire prohibited single-use plastics if sustainable alternatives are available, and these entities must implement reduction campaigns. Colombia’s National Environmental Licensing Authority (ANLA in its Spanish acronym) will oversee and enforce these measures. Among the measures included in the law, there is a request from distributors of plastic bags to submit reports on the rational use and recycling of bags in their inventory and must submit an Environmental Management Plan for packaging waste by 31 December. The law clearly will put an administrative burden on companies, not least distributors and the role they have been assigned as guardians of the law. In an interview with ICIS, the CEO of QuimicoPlasticos, a chemicals distributor in Colombia, said he thinks many aspects of the law will have to be reversed, not least points such as the nationally sourced recycled plastics as substitutes, given that recycling is in its infancy in the country and there will not be enough supply for years. QuimicoPlastics is a family-run distributor founded in 1982 and employs 80 people. It imports raw materials which distributes to the plastic packaging sectors (rigid and flexible) with end markets such agriculture, construction, food, and hygiene. The company was founded by the father of the current CEO, Federico Londoño, who has been on the post for 12 years. He has got low opinions about the law. “The law goes much further than a country like Colombia can afford. Moreover, globally and here in Colombia there are investments companies have made which are researching alternatives to, say, trays made of EPS [expandable polystyrene], but with laws like this the burden on companies grows and incentives for investment diminish,” said Londoño. It is a criticism shared across Latin America. In an interview with ICIS in June, the head of Chile’s plastics trade group Asipla also said parliamentarians push for sustainability was at times detached from the country’s reality. Before QuimicoPlasticos’ Londoño, the head of Colombia’s plastics trade group Acoplasticos also showed skepticism in an interview with ICIS about the law banning such wide range of single-use plastics. Before the law on single-use plastics, Colombia had already approved a tax on plastics production, which was marred with confusion in its initial stages of implementation. The moves around plastics have been welcome by environmental groups, some of them with the support of major consumer goods producers such as Washington-based Ocean Conservancy; in its website, it says some of its partners include Coca-Cola, Ikea, or Garnier, among many others. “With over 11 million tonnes of plastics entering the ocean each year, this law [banning single-use plastics] is a huge win for Colombia and the ocean,” said in a statement Edith Cecchini, director of international plastics at Ocean Conservancy. “Single-use plastic bags, straws, and stirrers are among the top ten most commonly found items polluting beaches and waterways worldwide by Ocean Conservancy’s International Coastal Cleanup. Ocean Conservancy applauds Colombia for this important step to prevent plastic pollution and protect marine life, and we hope that other countries will follow suit.” EXPANDING PUBLIC SERVICESThe push for sustainability by the left-leaning cabinet presided over by Gustavo Petro goes hand in hand with plans to increase tax receipts to finance the expansion in the welfare state Petro campaigned for. The cabinet has been under pressure to put the public accounts in order after posting fiscal deficits for most of Petro’s term. In June, the government published its fiscal plan for the coming years, hoping to quell fears among investors. Most analysts argued that the cabinet’s plans are too optimistic. For instance, it forecasts crude oil prices at around $90/barrel on average for the coming years, as a big chunk of Colombia’s income comes from its state-owned oil major Ecopetrol. To reassure investors, Finance Minister Ricardo Bonilla announced spending cuts worth Colombian pesos (Ps) 20 trillion ($5.1 billion, equivalent to 1.2% of GDP) to meet the target set out by the new fiscal plan 2024. “Even so, there’s reason for concern. For one thing, the government made clear that there would be no cuts to social spending; instead, a lot of the adjustment (around one third) will come in the form of cuts to public investment,” said Capital Economics at the time. Manufacturing, meanwhile, has been in the doldrums for much of 2023 and 2024, except for a positive spell in the first quarter. According to QuimicoPlasticos’ CEO, the government’s economic policy is deterring investments and creating uncertainty. “The economy is not going well. Industrial companies are suffering a high degree of uncertainty, because the fiscal burden on them continues to increase. This is no surprise, of course, when some public official within the cabinet have publicly said companies ‘steal from the people’ and they should be taxed more,” said Londoño. “Treating industrial companies as cash cows is wrong: these are the companies which need large sums in capital investments, and increasing taxes on them only deters that. If we add to that, for example, that the cabinet wants to reduce the role of fossil fuels in the country’s exports due to environmental reasons, you get a worrying picture for the coming years.” ($1 = Ps3,946) Insight by Jonathan Lopez

16-Jul-2024

HOUSTON (ICIS)–Logistics firm Stolthaven Terminals announced that in cooperation with Global Energy Storage (GES), it has been selected as the only potential operator to design, build and operate a green ammonia terminal in Brazil to be located within the industrial export zone at Pecem in the state of Ceara. The Port of Pecem Authority, referred to as CIPP, awarded the rights to the partnership after a 15-month tender process involving global storage providers. Stolthaven said this development will see the production of green hydrogen and ammonia and allow offshore markets access to one of the most competitive sources of this renewable energy. During the next phase, with the involvement of all parties including ammonia producers, the basic engineering of the terminals will be undertaken before confirmation of the official contract. In 2023, Stolthaven Terminals and GES agreed upon a partnership to develop and operate an export terminal for hydrogen and its derivatives with Stolthaven already having a local presence in Brazil with 42 years of experience as a storage provider in the Port of Santos. “We are proud to be chosen by CIPP as the right partner for its Hydrogen Hub. This is one more step towards executing our strategy for growth and supporting our customers in transitioning to green energy,” said Marcelo Schmitt, Stolthaven Santos general manager. “Brazil is fast becoming a new export powerhouse for biofuels and renewable energies and our extensive local and global experience, together with the expertise of our partner GES, will make it a successful and exciting development for the storage industry.”

15-Jul-2024

LONDON (ICIS)–Senior Editor for Recycling, Matt Tudball, discusses the latest developments in the European recycled polyethylene terephthalate (R-PET) market, including, Colourless flake prices rise in Italy Food-grade pellet (FGP) price range narrows on improved demand FGP proactive buyers move to secure volumes ahead of Single Use Plastics Directive (SUPD) implementation in January

12-Jul-2024

HOUSTON (ICIS)–The ports of Houston and Freeport in Texas remain mostly closed on Tuesday while millions remain without power following Hurricane Beryl's landfall at the start of the week. Port Houston said all of its terminals will remain closed on Tuesday. Port Freeport said the Freeport Harbor Channel is closed. Gates 4 and 14 are closed, while Gate 8 is opened. Freeport LNG Development had shut down its LNG operations at Freeport on July 7. It can export 15 million tonnes/year. Loadings for LNG tankers slowed considerably on 8 July due to rough seas and suspension of pilot services at Calcasieu Pass and Sabine Pass. Both are in Louisiana. The port of Corpus Christi is scheduled to reopen on Tuesday. It is the third largest oil-exporting port in the world, and it is home to Corpus Christi Liquefaction, a terminal that can export 15 million tonnes/year of liquefied natural gas (LNG). MILLIONS REMAIN WITHOUT POWERBeryl made landfall on Sunday in Matagorda, Texas, as a Category 1 hurricane, with maximum sustained windspeeds of 80 miles/hour (130 km/hour). So far, much of its effect on chemical operations has been by interrupting power. On late Tuesday morning, Texas reported more than 2.82 million outages, according to the website poweroutage.us, which keeps track of power outages in the US. CenterPoint Energy, the main electrical transmission and distribution company in Houston, said more than 1.76 million customers remain affected by outages. Entergy, the main one for eastern Texas, said on Monday evening that 247,000 customers remained without power. Texas-New Mexico Power, which handles the areas around Freeport and Galveston said it 73,220 customers are affected by outages. BERYL CAUSED SOME CHEM SHUTDOWNSElectrical outages and precautions had caused some chemical companies and refiners to shut down units. Enterprise Products said bad weather caused a trip to a propane dehydrogenation (PDH) unit in Mont Belvieu, Texas. Marathon Petroleum reported power loss and multiple unit shutdowns at its Galveston Bay refinery. Dow shut down its operations in Seadrift, Texas, as a precaution. In Baytown, ExxonMobil said it is continuing to assess the site for possible damage as it resumes normal operations. The company anticipated minimal impact to production. Formosa Plastics shut down its Olefins 1 unit at Port Comfort, Texas. Interoceanic Corporation (IOC) said its affiliate, PCI Nitrogen, has halted ammonium sulphate (AS) and sulphuric acid production at its facility in Pasadena, Texas. Phillips 66 reported an upset at its refinery in Sweeney, Texas. The refiner did not say if it shut down any unit. Personnel had returned it to normal operations. CITGO reduced operating rates at its refinery in Corpus Christi, Texas. BASF Total Petrochemical's cracker in Port Arthur, Texas, produced off-spec material because of a suspected lightning strike. LIMITED RAIL DISRUPTIONSOn Monday, BNSF said its Pearland intermodal facility in Houston remained closed.  WEATHER FORECASTIn the late morning, Beryl had degraded into a post tropical cyclone with maximum sustained winds of 30 miles/hour, according to the National Hurricane Center. It was in the northeastern part of the US state of Arkansas, and meteorologists expected it would continue traveling in that direction towards Canada. Thumbnail shows flooding caused by Beryl. Image by Reginald Mathalone/NurPhoto/Shutterstock

09-Jul-2024

SINGAPORE (ICIS)–Market players in Asia are increasingly becoming more interested in the use of pyrolysis oil as fuel. This was one of the critical insights gained by the ICIS recycling analyst team when they were at the Asia Petrochemical Industry Conference (APIC) 2024 in Seoul, South Korea, in May and the 2024 China Plastics Circularity Economy CEO Roundtable in Beijing, China, in June. Join recycling analysts Joshua Tan and Chua Xin Nee in this podcast as they discuss their key takeaways from both events and take a deeper dive into the recycling landscape in China. For more information about Asia’s recycling market, please contact joshua.tan@icis.com and xinnee.chua@icis.com.

09-Jul-2024

LONDON (ICIS)–Senior editor for recycling Matt Tudball discusses the latest developments in the European recycled polyethylene terephthalate (R-PET) market, including: Rises on the low end of colourless flake narrows UK, eastern Europe ranges Colourless, blue bale prices rise in Italian monthly auctions Increased bale supply, tighter PET, cheaper R-PET imports

05-Jul-2024

SINGAPORE (ICIS)–A consortium consisting of four Asian petrochemical producers have agreed to establish a sustainable polyester fiber supply chain. Japan's Mitsubishi Corp, South Korea’s SK geo centric, Thailand’s Indorama Ventures Ltd (IVL), and India Glycols along with three other companies are part of the consortium, the companies said in a joint statement on Thursday. Japanese sports apparel firm Goldwin is the project owner of the initiative, while Finnish refiner Neste is also part of the consortium alongside Japan-based engineering firm Chiyoda Corp. Financial details of the project were not disclosed. The project aims to utilize renewable and bio-based materials as well as materials produced via carbon capture and utilization (CCU) to manufacture polyester fibers for THE NORTH FACE brand in Japan. Outdoor apparel and equipment brand THE NORTH FACE is operated by Goldwin in Japan. "After that, the launch of further products and brands of Goldwin will be considered," Chiyoda said in the statement. The polyester fiber produced from the project is planned to be used by Goldwin for a part of THE NORTH FACE products, including sports uniforms in July this year. Chiyoda will supply CCU-based paraxylene (PX) to the supply chain, while Thai polyester producer IVL will contribute renewable CCU-based purified terephthalic acid (PTA). In March 2022, Chiyoda started producing carbon dioxide (CO2)-based PX at its pilot plant at the company's Koyasu Research Park in Kanagawa prefecture as part of a project linked with Japan's New Energy and Industrial Technology Development Organization (NED). SK geo centric and Neste will be supplying renewable PX and renewable naphtha, respectively. India Glycols, which produces monoethylene glycol (MEG), will supply bio-ethylene glycol made mainly from sugarcane. Toyobo MC Corporation (TMC) – a joint venture between Toyobo Co and Mitsubishi Corp – will be supplying renewable bio-CCU polyethylene terephthalate (PET). Details on supply volumes from each of the consortium partners were not disclosed. Thumbnail photo: A generic polyester clothing label (Sandvik/imageBROKER/Shutterstock)

04-Jul-2024

RIO DE JANEIRO (ICIS)–Brazil’s polymers major Braskem is still facing some logistical challenges at its facilities in Triunfo, in the floods-hit state of Rio Grande do Sul, according to a letter to customers seen by ICIS. Braskem was forced to shut down its Triunfo facilities after the severe flooding which affected the state in May. By the beginning of June, the producer said it hoped its operations would return to normality in a few days, according to a spokesperson in a written response to ICIS. However, according to the letter to customers, dated 28 June, Braskem’s operations at Triunfo are yet to return to normality, mostly due to logistical woes as many roads and key port operations at the Brazilian state were hit by the aftermath of the floods. “Specific challenges resulting from force majeure still persist in some logistics modes, leading to the partial receipt of inputs for the production of products derived from ethanol and green ethylene,” said the letter. “At the moment, there is no risk of interruption in the supply of these products, and we are implementing alternatives to return availability to normal levels.” At the end of June, an analyst said to ICIS most of the roads in Rio do Grande do Sul had reopened, although some of them were operating at reduced capacity. The Port of Porto Alegre, the largest city in the state and close to the Triunfo petrochemicals hub, only reopened in mid-June. TRIUNFO KEY FOR PLASTICS Braskem is Brazil’s sole manufacturer of polyethylene (PE) and polypropylene (PP), the most widely used polymers. Its market share in 2023 for PE stood at 56% and for PP at 70%, according to figures from the ICIS Supply & Demand database. The Triunfo complex, meanwhile, is key for the country’s polymers supply chain, accounting for nearly 37% of Brazil’s PP capacity and 40% of PE capacity. Brazil’s total PP production capacity is nearly 2 million tonnes/year. PE capacity is about 3 million tonnes/year, with 41% being high-density polyethylene (HDPE), 33% being linear low-density polyethylene (LLDPE) and 26% being low-density polyethylene (LDPE). Braskem’s Triunfo complex can produce 740,000 tonnes/year of PP, 550,000 tonnes/year of HDPE, 385,000 tonnes/year of LDPE and 300,000 tonnes/year of LLDPE. Additional reporting by Jonathan Lopez 

03-Jul-2024