SINGAPORE (ICIS)–The European Commission (EC) has announced a draft decision to impose up to 36.3% definitive countervailing duties on imports of battery electric vehicles (EVs) from China. The draft rates are lower than the provisional duties published on 4 July and took effect on 5 July, the commission said on 20 August.  China car companies Definitive duties (draft) Provisional duties BYD 17.0% 17.4% Geely 19.3% 19.9% SAIC 36.3% 37.6% Other cooperating companies 21.3% 20.8% All other non-cooperating companies 36.3% 37.6% The Commission said that definitive measures must be imposed no later than four months after imposition of provisional duties and definitive findings will be published by 30 October 2024 at the latest. It granted a lower individual duty rate of 9% to US EV maker Tesla as it was classified as an exporter from China at this stage, down from the 20.8% provisional rate. The duties, once finalized, will be in force for five years. In a response to EC’s decision, China’s Ministry of Commerce said that the EU’s ruling discriminates between different types of Chinese companies which distorted the results of the investigation. “The final ruling was based on the ‘facts’ unilaterally identified by the EU, rather than the facts recognized by both sides. China firmly opposes this and is highly concerned,” the ministry said. The China Association of Automotive Manufacturers (CAAM) voiced strong opposition to the decision, saying that the European Commission seriously “distorted the facts” of China’s EV industry. The EU duties bring great risk and uncertainties to Chinese companies’ operations and investment in the bloc, damage their business confidence, as well as impact EU’s development of EV industry, the association said. The automotive industry is a major global consumer of petrochemicals, which account for more than a third of the raw material costs of an average vehicle. EVs and associated battery markets provide growth opportunity for the chemical industry, with chemical producers separately developing battery materials, as well as specialty polymers and adhesives for the environment-friendly vehicles. Thumbnail image: Cars for export at Yantai port in China – 07 August 2024 (Costfoto/NurPhoto/Shutterstock)

SINGAPORE (ICIS)–The 18th Annual Gulf Petrochemicals and Chemicals Association (GPCA) Forum will be held in Muscat, the capital of Oman, on 2-5 December. The annual event will take place for the first time in Oman and will address the theme “Industry’s Next Chapter: Driving Sustainable Advancement for Global Progress”, event organizer GPCA said in a statement released on 20 August. The 17th Annual GPCA Forum last year in Qatar attracted 5,127 delegates. The chemicals industry makes up the second largest manufacturing sector in the Gulf Cooperation Council (GCC) after oil and gas, producing over $108 billion worth of products every year, according to the GPCA. The GCC comprises Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the UAE.

HOUSTON (ICIS)–The National Corn Growers Association (NCGA) said it is urging Canadian Prime Minister Justin Trudeau to resolve a dispute between his nation’s railways and the employees. The US trade group is concerned if left unresolved, the labor issues could result in a strike interrupting rail service into the US. The NCGA said Canada is the third-largest destination for US agricultural exports and the second-largest source of agricultural imports. The main threat to corn growers is that a strike could interrupt shipments of fertilizer imports and exports of ethanol, corn and byproducts used as animal feed just as harvest is getting close to commencing in many of the key states. “If a strike shuts down rail service from Canada into the US, it will adversely impact America’s farmers who rely on rail to ship goods between the two countries,” said Harold Wolle, National Corn Growers Association president. “We encourage Prime Minister Trudeau, the Teamsters and Canadian rail workers to do everything possible to avoid such a strike.” Both railways have issued lockout notice which would begin 22 August while the union has issued a strike notice also starting 22 August. The NCGA noted that under federal labor law, Canadian officials can order all parties to enter binding arbitration and that it has joined other agricultural groups in sending a letter to the prime minister calling for action. “We plan to keep calling for a resolution on this issue. The stakes are high, and this is the last thing our farmers need as they deal with a drop in corn prices and higher input costs,” Wolle said.

HOUSTON (ICIS)–Fertilizer Canada said disruptions to rail services across the country will cost the fertilizer industry an estimated C$55-63 ($40.3-46.2) million per day in lost sales revenue. Facing a potential strike, the industry group is urgently calling on the federal government to take immediate action to prevent a work stoppage on both railways. It wants to see binding arbitration that prohibits Teamsters Canada Rail Conference (TCRC) from undertaking strike action and CN Railway and Canadian Pacific Kansas City (CPKC) from lockout action. Both railways have served lockout notices to TCRC beginning 22 August and TCRC has served a strike notice to CPKC also beginning 22 August. “The time for action is now. We can no longer patiently wait for a resolution. The federal government must protect Canada’s economy and food security by ordering binding arbitration,” said Karen Proud, Fertilizer Canada president and CEO. The group noted that the railways move an average of 69,000 tonnes of fertilizer product per day, which is equivalent to four to five trains. The fertilizer industry is among the first to experience slowdowns. As on 12 August, the movement of some ammonia products were halted when they were embargoed. Since that action the railways have issued further embargoes, including US railways halting shipments to Canada. Currently 75% of all fertilizer produced and used in Canada is moved by rail, with minimal transportation alternatives, with 90% of those volumes which are destined for the US market delivered by rail. “In the last seven years, Canadian supply chain labour disruptions have cost the fertilizer industry nearly a billion dollars,” Proud said. “These stoppages are doing immense damage to our reputation as a reliable trading partner.” “Our customers, who rely on Canadian fertilizer products, are being forced to turn to our competitors in Russia, Belarus and China. We can’t afford for our railways to shut down, and we can’t afford a passive approach to our supply chains any longer. We need long-term solutions.” Fertilizer Canada represents producers, manufacturers, wholesale and retail distributors of nitrogen, phosphate, potash and sulphur fertilizers. $1.00=C1.36

LONDON (ICIS)–Crude benchmarks are likely to be subject to bearish pressure in week 34 as Chinese oil demand concerns take centre stage. However, European and US economic data released later this week may provide clues to future monetary policy decisions and provide hope for upcoming interest rate cuts. ICIS experts look at factors that are forecast to drive oil prices in Week 34.

LONDON (ICIS)–Construction output in the eurozone rebounded in June after declining for three months, official data showed on Tuesday. Seasonally adjusted production in construction rose by 1.7% from May and was also higher, by 1.4%, in the EU. Eurozone output had been on a downward trend since March, with the EU following a similar track, though with a marginal, near flat 0.1% rise in April. Building construction, civil engineering and specialized construction activities all increased in June from the previous month in both the eurozone and EU, according to statistics agency Eurostat. On a year-on-year basis, June construction output in the eurozone was 1.0% higher in the eurozone and 0.1% lower in the EU. Numerous petrochemicals and specialty chemicals are key ingredients in products used for modern construction, including adhesives, ad-mixtures, sealants, coatings, paints, flooring, insulation and water proofing.

MUMBAI (ICIS)–India’s state-owned Bharat Petroleum Corp Ltd (BPCL) plans to invest rupee (Rs) 1.7 trillion ($20.3 billion) over the next five years to grow its refining and fuel marketing business, as well as expand its petrochemicals and green energy businesses. 44% of total earmarked for refinery, petrochemical capacity growth Bina refinery/petrochemical project due for commissioning in FY2028-29 New refinery project being mulled As part of the investment initiative named ‘Project Aspire’, some Rs750 billion will go to increasing capacity at BPCL’s refineries and expand its petrochemical portfolio, company chairman G Krishnakumar said in the company’s annual report for the fiscal year ending March 2024. “The demand for major petrochemical products is expected to rise by 7-8% annually. This presents a strategic opportunity to expand refining capacity alongside the development of integrated petrochemical complexes,” Krishnakumar said. BPCL’s planned petrochemical expansions include the new petrochemical projects at its Bina refinery in the central Madhya Pradesh state, and the Kochi refinery in the southern Kerala state. The Bina project is a brownfield expansion that will raise the refinery’s capacity by 41% to 11m tonnes/year, to cater to the requirements of upcoming petrochemical plants, which include a 1.2m tonnes/year ethylene cracker and downstream units. The site is expected to produce 1.15m tonnes/year of polyethylene (PE), including high density PE (HDPE) and linear low density PE (LLDPE); 550,000 tonnes/year of polypropylene (PP); and 50,000 tonnes/year of butene-1 The complex will also produce chemicals such as benzene, toluene, xylene, the annual report said. “Technology licensors for all critical packages, and project management consultants for refinery expansion and downstream units have been onboarded and work at the site commenced in the first week of July 2024,” Krishnakumar said. BPCL has chosen US-based Lummus to provide technologies for the new ethylene plant and downstream units at the complex. The refinery will be ready for commissioning by May 2028, while petrochemical operations will begin in the financial year ending March 2029. At Kochi, BPCL’s 400,000 tonne/year PP project is progressing as per schedule and is on track for commissioning in October 2027. It plans to raise its Kochi refinery capacity by 16% over the next five years to 18m tonnes/year, based on data from the company’s latest annual report. https://subscriber.icis.com/news/petchem/news-article-00110958286 The company also plans to set up additional petrochemical capacities over the next few years. “To meet the anticipated demand beyond our planned expansions in Bina and Kochi, we are actively evaluating options for setting up additional integrated refining and petrochemical capacities within the next 5-7 years,” Krishnakumar said BPCL has begun evaluating options to set up a new refinery with a planned capacity of around 9 million to 12 million tonnes/year, a company official said, adding, “we are exploring a new refinery either on the east coast or at other locations”. In Mumbai, the company also plans to expand its refinery capacity by a third to 16m tonnes/year in the next five years, according to its annual report. In the eastern Odisha state, BPCL expects to begin operations at its 200 kilolitre/day ethanol plant at Bargarh by October 2024. Once operational, the integrated refinery is expected to produce both first generation (1G) as well as second generation (2G) ethanol using rice grain and paddy straw as feedstock. Focus article by Priya Jestin ($1 = Rs83.85) Thumbnail image: The Bharat Petroleum import terminal at Haldia in West Bengal on 13 March 2021. (Debajyoti Chakraborty/NurPhoto/Shutterstock)

HOUSTON (ICIS)–The US corn crop is now at 97% silking with soybean blooming having reached 95%, according to the latest US Department of Agriculture (USDA) weekly crop progress report. For corn, the current rate of the crop silking is just slightly trailing both the 98% achieved last year and the five-year average of 98%. The amount of crop now at the dough stage is 74%, which equals the 74% rate from 2023 and is above the five-year average of 71%. Corn which has reached the dented phase is at 30%, which matches the 30% level from last year and is ahead of the five-year average of 26%. In the first update on corn reaching maturity, the report showed there is 5% of the crop at this stage, which is above the 3% from 2023 as well as the five-year average of 3%. For corn conditions, there is now 4% rated very poor with 7% still listed as poor and 22% as fair. There remains 51% as good and 16% as excellent. The soybean crop is now 95% blooming, which is equal to the 95% rate achieved in 2023 as well as the five-year average of 95%. The amount of acreage setting pods has risen to 81%; this trails the 84% mark from last year, but is above the five-year average of 80%. For soybean conditions, there continues to be 2% listed as very poor, 6% as poor and 24% as fair. There is now 54% seen as good with 14% as excellent. In harvesting updates, winter wheat is now at 96% completed which is slightly ahead of the 95% level from 2023 as well as the five-year average of 95%. Spring wheat harvest has reached 31% completed, which is behind the 35% mark from last year and the five-year average of 36%.

HOUSTON (ICIS)–As the water level in the freshwater lake that feeds the Panama Canal’s locks continues to rise, the Panama Canal Authority (PCA) has increased the maximum allowable draft to 50ft (15.25m), effective immediately, and will add an additional transit slot beginning 1 September. The additional slot brings the total number of passages allowed per day to 36, almost at par with the 36-38 transits/day seen before a drought forced the PCA to limit transit for the first time in its history. There are 10 slots for Neopanamax vessels, 20 for supers and six for regular vessels. The region has been through an intense drought that caused the PCA in 2023 to lower allowable drafts and to limit the number of vessels permitted to transit each day, a first since the canal formally opened in 1914. Restrictions have gradually eased over the past few months and are approaching the average daily transits of 36-38/day seen prior to impacts from the drought. The better conditions at the canal are likely to improve transit times for vessels traveling between the US Gulf and Asia, as well as between Europe and countries on the west coast of Latin America. This should benefit chemical markets that move product between regions, as shown in the following chart. WAIT TIMES FOR NON-BOOKED VESSELS Wait times for non-booked southbound vessels ready for transit have been relatively steady at around two days, according to the PCA vessel tracker. As of 19 August, the tracker showed wait times of 3.0 days for northbound traffic and 0.5 days for southbound traffic. Visit the ICIS Logistics – impact on chemicals and energy topic page Thumbnail image shows a container ship passing through the Panama Canal. Courtesy the Panama Canal Authority