News library
Subscribe to our full range of breaking news and analysis
Commodity group
Region
Date
Viewing 1-10 results of 57765
Gas13-Dec-2024
SINGAPORE (ICIS)–China has pledged to boost
domestic consumption and implement a
looser monetary policy amid a looming
trade war with the US when Donald Trump takes
office in 2025.
The pledges were made on 12 December after the
two-day annual Central Economic Work Conference
(CEWC) of China’s top officials to set the
country’s 2025 economic agenda, according to
state-owned news agency Xinhua.
The proactive policy stance largely echoes the
recommendations of the Political Bureau of the
Communist Party of China (Politburo) on 9
December.
Chinese leaders signalled their aim to reduce
the reserve requirement ratio (RRR) of banks,
and key interest rates “at an appropriate
timing to ensure ample liquidity”, policies
that will likely weaken the yuan (CNY).
A weaker yuan would make Chinese exports more
competitive in the global market, at a time
when they are facing
high tariffs from the US.
Ahead of the expected US tariff imposition,
Chinese exporters have started to
frontload shipping goods to the US in
November 2024 following Trump’s victory in the
US presidential elections.
China is the world’s second-biggest economy.
The country’s domestic spending, which has been
on a downtrend in 2024, will also be tackled,
with Chinese leaders urging efforts to
“vigorously boost consumption, improve
investment efficiency, and expand domestic
demand”.
A special campaign dedicated to stimulating
consumption should be implemented, and efforts
should be made to increase the incomes and
alleviate the burdens of low- and middle-income
groups, according to the meeting.
Fiscal stimulus measures were
introduced around end-September but were deemed
insufficient for China to achieve its GDP
growth target of around 5% in 2024.
China aims to maintain “steady economic growth”
next year, based on the CEWC report, although
growth targets and specific stimulus plans will
only be released at the National People’s
Congress (NPC) in March 2025.
($1 = CNY7.28)
Caustic Soda12-Dec-2024
HOUSTON (ICIS)–Olin plans to shut down its
diaphragm-grade chloralkali capacity in
Freeport, Texas, that provides feedstock to
Dow’s propylene oxide (PO) unit, the US-based
chloralkali producer said on Thursday.
Dow plans to shut down that PO unit
at the end of 2025, and those plans
prompted Olin to close the diaphragm-grade
chloralkali capacity that serves the Dow
facility.
Olin’s is restricting the shutdown to capacity
that relies on asbestos-based technology.
US regulators seek to end the use of
asbestos in the chloralkali industry.
The amount of diaphragm-grade chloralkali
capacity that Olin plans to shut down at
Freeport amounts to 450,000 electrochemical
units (ECUs), according to the company.
Olin already has shut down its
diaphragm-grade chloralkali capacity in
McIntosh, Alabama.
It plans to transition its chloralkali capacity
in Plaquemine, Louisiana, to non-asbestos-based
technology, the company said.
Chloralkali units produce caustic soda and
chlorine.
Thumbnail shows salt, which is used to make
caustic soda and chlorine. Image by Alessandra
Sarti/imageBROKER/Shutterstock (
Speciality Chemicals12-Dec-2024
BARCELONA (ICIS)–European polyethylene (PE)
markets face growing pressure from cheaper
imports, highlighting the impact of rising
overcapacity driven by China and the US.
Plants in Europe operating at technical
minimum levels
Minimal stocks held amid plentiful supply
Demand poor across most end uses, packaging
stronger
Europe will see more PE imports as global
overcapacity grows
More polymer plant closures are likely in
Europe and other high-cost regions
US has more to lose from trade war as it is
a major exporter of PE to China
Trade flows could change dramatically if
tariff walls go up
Supply/demand imbalance may take up to nine
years to correct
In this Think Tank podcast, Will
Beacham interviews ICIS markets
editors Vicky Ellis and
Ben Monroe-Lake plus ICIS
market development executives Nigel
Davis and John
Richardson.
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.
Global News + ICIS Chemical Business (ICB)
See the full picture, with unlimited access to ICIS chemicals news across all markets and regions, plus ICB, the industry-leading magazine for the chemicals industry.
Crude Oil12-Dec-2024
LONDON (ICIS)–Global crude oil markets are
likely to be comfortably supplied next year
despite moves by OPEC+ to hold back on easing
production cuts and anticipated firmer demand,
the International Energy Agency (IEA) said on
Thursday.
Oil demand in 2025 is expected to pick up from
840,000 barrels/day this year to 1.1 million
barrels/day next year, bringing total daily
consumption to 103.9 million barrels, according
to the agency.
The petrochemicals sector is expected to be the
key driver for that uptick, with transport
fuels consumption growth still constrained, and
China demand still substantially slower than
might have been predicted a few years earlier.
Total oil supply growth is expected to increase
by 1.9 million barrels/day next year, compared
to a 630,000 barrels/day increase in 2024,
driven by non-OPEC+ nations, which are expected
to comprise 1.5 million barrels/day of the
growth.
The OPEC+ coalition of nations announced plans
last week to hold
back on easing voluntary production cuts
and slow the rates at which some of the
measures are phased out, in the face of
continued slow demand growth.
OPEC+ member states agreed to extend voluntary
cuts amounting to approximately 2.2 million
barrels/day through to the end of March next
year, and slow the pace of the reintroduction
of those volumes so that the process will run
through to September 2026.
Additional voluntary cuts amounting to 1.65
million barrels/day are to be held in place
until the end of December 2026, OPEC added.
The moves have substantially reduced the
projected supply overhang for 2025, the IEA
said, but demand trends still point to an ample
buffer of available product.
“Persistent overproduction from some OPEC+
members, robust supply growth from non-OPEC+
countries and relatively modest global oil
demand growth leaves the market looking
comfortably supplied in 2025,” the agency said
in its monthly oil report.
The US, Brazil, Canada and Guyana are expected
to drive production growth next year, while
OPEC+ crude output may still stand to increase
if Libya, Sudan and South Sudan sustain volumes
and additional capacity comes onstream in
Kazakhstan, the IEA said.
Crude price moves have been relatively subdued
in recent months despite geopolitical tensions,
with Brent crude futures averaging around
$73/barrel, the IEA said, a trend that has
continued into December, with midday trading prices
of around $73.47 on Thursday.
Despite the latest measures announced by OPEC+
and political uncertainty across parts of the
globe, demand remains the big question for next
year, the agency said.
“The abrupt halt to Chinese oil demand growth
this year – along with sharply lower increases
in other notable emerging and developing
economies such as Nigeria, Pakistan, Indonesia,
South Africa and Argentina – has tilted
consensus towards a softer outlook,” the IEA
said.
Thumbnail photo: An oil platform off the
coast of California (Source: Shutterstock)
Crude Oil12-Dec-2024
SINGAPORE (ICIS)–The UAE will impose a minimum
top-up tax (DMTT) on large multinational
companies, to align its tax system to global
standards.
The DMTT, which will take effect for financial
years beginning on or after 1 January 2025, is
a component of the OECD’s global minimum
corporate tax agreement signed by 136
countries, including the UAE, the country’s
Ministry of Finance said on 9 December.
OECD is a group of industrialized economies
with 38 members. (Note: ICIS doesn’t spell out
OECD)
The new tax will apply to multinational
enterprises operating in the UAE with
consolidated global revenues of at least €750
million in the past two years, the ministry
said.
Small petrochemical converters and traders in
the UAE are not expected to be affected by the
new tax.
These tax amendments follow a 9% business tax
implemented in 2023, with exemptions for
special free zones that operate under different
laws.
Alongside the DMTT, tax incentives for research
and development (R&D) as well as a
refundable tax credit for “high-value
employment activities” will also be introduced,
the ministry said.
The R&D tax incentive, beginning 1 January
2026, will offer a potential 30-50% tax credit,
while the high-value employment tax incentive
will, from 1 January 2025, be “granted as a
percentage of eligible salary costs” for
eligible employees, including C (chief)-suite
executives.
The initiatives aim to “enhance the UAE’s
global competitiveness” as well as spur
innovation and growth, the ministry said.
Additional reporting by Nadim Salamoun
Ammonia11-Dec-2024
HOUSTON (ICIS)–The US Department of
Agriculture (USDA) is expecting increases in
corn utilized for ethanol, larger exports, and
lower ending stocks, while soybean supply and
use projections are unchanged, according to the
December World Agricultural Supply and Demand
Estimate (WASDE) report.
In the monthly update, the USDA said corn used
to produce ethanol is raised by 50 million
bushels to 5.5 billion bushels. This lift is
based on the most recent data from the Grain
Crushings and Co-Products Production report and
weekly ethanol production data for the month of
November.
The agency said this data implies that corn
used for ethanol during the September to
November quarter was the highest since 2017.
The December WASDE shows corn exports raised by
150 million bushels to 2.5 billion bushels,
which the USDA said reflects the pace of sales
and shipments to date.
With no other use changes, corn ending stocks
are reduced 200 million bushels to 1.7 billion.
The season-average corn price received by
producers continues to be unchanged at $4.10
per bushel.
For soybeans, the supply and use projections
are unchanged but the monthly update has lifted
soybean oil production to 131.2 million tons,
with the USDA saying it is up slightly due to
an increase for cottonseed.
With higher soybean oil supplies and strong
export commitments to date, exports are raised
500 million pounds to 1.1 billion pounds.
The December WASDE said the season-average
soybean price is being forecasted at $10.20 per
bushel, down $0.60 from last month.
The first WASDE report of 2025 will be released
on 10 January.
Ethylene11-Dec-2024
HOUSTON (ICIS)–A new gas pipeline set to be
built by Energy Transfer should provide support
for natural gas and ethane prices in the
Permian producing basin, lowering the
likelihood that US chemical producers see
another period of ultra-low costs for the main
feedstock used to make ethylene.
Energy Transfer’s new Hugh Brinson pipeline,
previously known as Warrior, will ship natural
gas from the Waha Hub in West Texas, to
Maypearl, Texas, which is south of Dallas. The
first phase of the project will ship 1.5
billion cubic feet/day of natural gas.
Operations should start by the end of 2026.
Depending on demand, Energy Transfer could
concurrently start construction on a second
phase that will increase the pipeline’s
capacity to 2.2 billion cubic feet/day.
Energy Transfer’s pipeline is the second major
one announced in the past six months. Earlier,
a new joint venture announced Blackcomb, a
pipeline that can ship up 2.5 billion cubic
feet/day of natural gas from the Permian basin
to the Agua Dulce area in south Texas.
Blackcomb will be developed by joint venture
made up of Targa and WPC, itself a joint
venture made up of WhiteWater, MPLX and
Enbridge.
NEW PIPELINES TO SUPPORT ETHANE BY
REDUCING LIKELIHOOD OF NEGATIVE WAHA
PRICESThe two new pipelines
should provide West Texas with sufficient
capacity to take away natural gas from the Waha
Hub and prevent regional prices from falling
below zero.
The Waha Hub is the main pricing point for the
natural gas produced by the oil wells in the
Permian basin. Prices at the hub spent much of
2024 below zero because existing pipeline
capacity was insufficient to take away excess
supplies, which were growing because of rising
oil production and gas-to-oil ratios across the
basin.
When gas prices at Waha fall below zero, it
creates a powerful incentive for processing
plants to recover as much ethane as possible
from the gas stream. Any ethane that remains in
the gas stream is sold for its fuel value. When
gas prices are negative, producers are unable
to capture any value for the ethane left
behind.
By maximizing ethane recovery, processing
plants also free up existing pipeline space,
allowing more natural gas to be taken out of
West Texas.
The surge in ethane recovery increased the
amount of the feedstock available to the
market. At one point in 2024,
ethane prices fell below 12 cents/gal, a
low not seen since the COVID pandemic.
Since that low, the start up of the Matterhorn
Express pipeline has increased takeaway
capacity in the Permian, which caused Waha gas
prices to rise above zero. Colder temperatures
also supported prices for natural gas by
increasing demand.
Ethane prices are now trading above 20
cents/gal.
LNG, ETHANE TERMINALS ALSO INFLUENCE
COST FOR CHEM FEEDSPricing at
the Waha Hub is one of the many factors that
can influence the cost of ethane for chemical
producers.
Maintenance on one or more of the pipelines
that takes away gas from the Permian basin can
also depress Waha prices and, potentially,
those for ethane.
The proliferation of liquefied natural gas
(LNG) terminals on the Gulf Coast is playing an
increasing role in natural gas and ethane
prices.
These terminals are vulnerable to disruptions
caused by hurricanes and tropical storms that
pass through the Gulf of Mexico. These storms
can disrupt LNG operations and temporarily shut
down a large source of gas demand in the US.
If the outage lasts long enough, it can cause a
meaningful increase in US supplies of natural
gas. That can lower prices for gas as well as
the recovery cost for ethane.
Midstream companies are increasing their
capacity to export ethane overseas, which
should support prices for the feedstock.
Enterprise is adding 120,000 bbl/day of
capacity via the first phase of the Neches
River Terminal project, scheduled to come
online in mid-2025. A second phase, due online
in the first half of 2026, will add up to
another 180,000 bbl/day of ethane export
capacity.
Enterprise and Navigator are
adding ethane export capabilities as part
of the expansion projects at their existing
ethylene terminal in Morgan’s Point.
Energy Transfer is also adding 250,000
barrels/day of flexible export capacity, which
is scheduled to start up during the second half
of next year.
Similarly, new crackers will increase demand
for ethane.
The only confirmed new US cracker is a
joint-venture cracker that Chevron Phillips
Chemical and QatarEnergy should start up in
late 2026 in Texas.
Shintech could build a cracker in
Louisiana, but the company has yet to announce
a final investment decision (FID).
Insight article by Al
Greenwood
Thumbnail shows natural gas. Image by
Hollandse Hoogte/Shutterstock
Crude Oil11-Dec-2024
SINGAPORE (ICIS)–South Korea will invest won
(W) 14 trillion ($9.78 billion) to build a new
port in the southern city of Changwon, as part
of its plans to upgrade Busan Port.
It will be unified with Busan Port to become a
new “mega port”, raising its vessel capacity to
66 when it is completed in 2045 from 40
currently, the Ministry of Oceans and Fisheries
said on Wednesday.
Busan Port is South Korea’s largest and the
second-largest transshipment port globally.
Its total berth length will be extended to 25.5
kilometers (km) compared with 18.8km currently,
according to the ministry.
South Korea needed to increase its global
competitiveness amid port expansions in China
and
Singapore; as well as increased supply
chain uncertainties due to “escalating trade
disputes between countries” and conflicts in
the Middle East, the ministry said.
($1 = W1431.8)
Polyethylene11-Dec-2024
SINGAPORE (ICIS)–Click here to see the
latest blog post on Asian Chemical Connections
by John Richardson: It is that time of the year
again when analysts need to put their
reputations on the line and make forecasts for
the following year.
So, see below five forecasts for 2025 with
detailed descriptions as follows:
There will be enough new capacity coming
onstream next year to push China closer to
self-sufficiency in some chemicals and polymers
such as polypropylene (PP). The boat has
already sailed on products such as purified
terephthalic acid (PTA) and styrene where China
has, in recent years, swung into net export
positions. What will further bolster China’s
self-sufficiency will be China’s long-term
decline in demand growth. China’s operating
rates will be higher than sometimes assumed, as
it will prioritize self-sufficiency, and
potentially more exports (see point 3) over
individual plant economics.
We are seeing a long-term shift in global
growth momentum to the much more populous and
much more youthful mega region of the
Developing World ex-China. Part of this process
involves relocation of manufacturing capacity
from China to countries such as Turkey, Mexico,
Vietnam and India for cost and geopolitical
reasons, and this will continue in 2025. Deals
will be done by the Trump administration on
tariffs as competitively priced imports will
have to come from somewhere – and because of
the intricate and complex integration of
manufacturing supply chains.
Since 2021 and the Evergrande Turning Point,
China had doubled down on exports up and down
manufacturing chains, reducing the room for
competitors in low, medium and high-value
industries. This includes its switch to net
export positions in products such as PTA and
styrene, and the potential for this to happen
in products such as PP, acrylonitrile
butadiene styrene (ABS) and polycarbonate (PC).
I, therefore, believe that antidumping, tariff
and other protectionist measures against China
will accelerate in 2025. China will respond in
kind.
First came the pandemic-related disruptions to
global container shipping and, since February
of this year, we’ve had to contend with the
Houthi attacks on shipping that have disrupted
access to the Suez Canal via the Red Sea.
Access to cost-efficient and prompt logistics
will remain a key competitive advantage in 2025
for chemicals companies as global trade flows
will remain disrupted for whatever reasons.
The ICIS numbers tell us that because of
disappointing Chinese demand, and the scale of
global capacity closures required to bring
markets back into balance, a new upcycle in
2025 is a very remote possibility. Expect no
upswing for at least the next three years
because of the scale of the shutdowns
necessary.
I could be wrong, of course. I’ve been advised
not to keep saying this, but I disagree as
nobody likes somebody who never concedes when
they are wrong, moves on from the history of
where and when they have been wrong, and
assumes that they will always be right in the
future.
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.
Contact us
Partnering with ICIS unlocks a vision of a future you can trust and achieve. We leverage our unrivalled network of industry experts to deliver a comprehensive market view based on independent and reliable data, insight and analytics.
Contact us to learn how we can support you as you transact today and plan for tomorrow.