LONDON (ICIS)–Ahead of the 3rd ICIS Recycled Polymers Conference in Berlin on 7 November, Senior Analyst for Recycling Egor Dementev discusses the challenges and opportunities for both mechanical and chemical recycling with Annick Meerschman, Innovation Director at CEFIC. Topics covered include: Innovations driving plastic recycling in Europe Chemical recycling technology evolution Impact of legislation and regulation Challenges facing the recycling industry

LONDON (ICIS)–Here are some of the top stories from ICIS Europe for the week ended 11 October. Evonik plans major restructure of two business units as global competition intensifies German specialty group Evonik plans to restructure two of its business units, putting non-core assets up for sale, closure or partnerships. Hurricane Milton moves off Florida’s east coast with damaging winds, heavy rainfall Hurricane Milton is moving away from Florida’s east coast but is still producing damaging winds and heavy rainfall in the state, according to the latest update on Thursday. Fundamental change still potentially ahead for chemicals industry Massive overcapacity along some value chains is likely to drive further fundamental shifts in the global chemicals landscape, with differentiation and innovation key to remaining competitive. Europe chems market overdue for restructure – Brenntag chief The European chemicals market is overdue a “massive” restructuring, the CEO of Brenntag said on Tuesday, to create players that can withstand competitive pressures from companies in higher-growth markets. Europe MPG outlook downbeat, but potential de-icing demand brings some hope Europe’s mono propylene (MPG) spot market will likely remain subdued into early Q1 2025 against a tough macroeconomic backdrop.

SINGAPORE (ICIS)–Here are the top stories from ICIS News Asia and the Middle East for the week ended 11 October. Vietnam Q3 economy grows 7.4% despite heavy typhoon losses By Nurluqman Suratman 07-Oct-24 14:16 SINGAPORE (ICIS)–Vietnam’s economy expanded by 7.4% year on year in the third quarter despite hefty losses from Typhoon Yagi, with growth marking its strongest in two years on robust exports. PODCAST: UAE base oils may see higher Q4 imports; US Group II offers keenly awaited By Damini Dabholkar 07-Oct-24 14:29 SINGAPORE (ICIS)–The base oils market in UAE is likely to see an uptick in demand in the fourth quarter, with the impact of escalating tensions in the region on crude prices and Group I supply from Iran closely monitored in the weeks ahead. Asia MMA import trade to stay subdued amid weak buyer confidence By Jasmine Khoo 09-Oct-24 13:18 SINGAPORE (ICIS)–The methyl methacrylate (MMA) spot trade in Asia is likely to stay curtailed in the near term. China ethanolamines dull post holidays while SE Asia and India struggle By Clive Ong 10-Oct-24 15:13 SINGAPORE (ICIS)–The ethanolamines market in China remained slow after the country’s Golden Week holidays. Demand remained tepid while domestic prices held steady. S Korea’s Hyundai Motor seeks to raise $3.3 billion from India IPO By Nurluqman Suratman 10-Oct-24 16:40 SINGAPORE (ICIS)–Hyundai Motor’s subsidiary in India is seeking to raise up to won (W) 4.4 trillion ($3.3 billion) through an initial public offering (IPO) on 15 October. China Sept petrochemicals weaken; Oct demand pick-up unlikely By Yvonne Shi 11-Oct-24 12:25 SINGAPORE (ICIS)–Falling costs of crude oil and weaker-than-expected seasonal end-demand caused China’s domestic petrochemical markets to weaken in September, with players expecting the current supply-demand imbalance to persist for the rest of the year. S Korea central bank cuts key interest rate to 3.25% amid slowing inflation By Jonathan Yee 11-Oct-24 17:33 SINGAPORE (ICIS)–South Korea’s central bank on Friday lowered its benchmark interest rate by 25 basis points to 3.25% after holding rates for nearly two years, seeking to revitalize the economy amid moderating inflation.

HOUSTON (ICIS)–Entering day two of post-hurricane activities and as the community of Tampa and surrounding cities attempt to clean up and dry out, the fertilizer industry is still assessing damage with flooding appearing to have had the biggest impact on production sites. Striking as a Category 3 hurricane late 9 October the storm brought intense and life-threatening conditions to a section of Florida that had already faced such a threat less than two weeks before. It particularly impacted the Tamp, Florida area, which is a key hub of the US fertilizer industry. Market sources, based in this region, said most of the focus on Friday was cleaning up and trying to determine how much damaged had been caused. The extent of impacts to fertilizer facilities were not fully clear but producer Mosaic did say it had some issues because of the storm but that once it had the full updates about Hurricane Milton’s impact on their facilities it would post on their website. As was the fear of environmentalists the gypstacks that are a fixture of phosphate production experienced problems with the water supporting the storage at the Mosaic Riverview facility having likely entered the Tampa Bay because of the extreme rainfall. “Back-to-back historic storms crossed our operational areas. Our sites withstood the conditions with few challenges. Our Riverview site, which has operated on Tampa Bay for the last century, received nearly 15 inches of rain during Hurricane Milton less than two weeks after Hurricane Helene,” said Mosaic. “A water collection system supporting our closed gypstack became overwhelmed, pushing excess water out a manhole on our property. At this time, we believe some of that impacted stormwater made its way to an outfall which discharges into Tampa Bay.” Mosaic said the issue was addressed on 10 October and is not continuing but added that the volume may have been greater than the 17,500-gallon reporting standard. “We expect water quality impacts, if any, to be modest. We’ve been in constant communication with regulators who are onsite today,” Mosaic said. Florida environmental authorities have not made any statement but ahead of the storm had said they were preparing and would have all resources available to oversee the regulated facilities and operations.

HOUSTON (ICIS)–Corn production is forecasted to increase by 17 million bushels while soybean output is expected to decline by 4 million bushels, according to the October World Agricultural Supply and Demand Estimate (WASDE) report from the US Department of Agriculture (USDA). In the monthly update the agency said the current outlook for corn is for smaller supplies, larger exports and reduced ending stocks. Projected beginning stocks for 2024-2025 are now 52 million bushels lower based on the Grain Stocks report. Corn production is now being forecasted at 15.2 billion bushels, up 17 million bushels from last month on a 0.2-bushel increase in yield to stand at 183.8 bushels/acre. Harvested area for grain is unchanged at 82.7 million acres. Total use is raised slightly to 15.0 billion bushels reflecting greater exports, and with supply falling and use rising, the ending stocks have been reduced by 58 million bushels to 2 billion bushels. The October WASDE said the season-average corn price received by producers is unchanged at $4.10/bushel. For soybeans, the USDA is showing that production is now being forecasted at 4.6 billion bushels, which is down 4 million bushels and is based on expectations of lower yields. Harvested area is unchanged at 86.3 million acres. The monthly update reveal that soybean yield is now projected at 53.1 bushels/acre, down 0.1 bushels from the September update. As lower production is being partly offset by slightly higher beginning stocks the USDA said supplies are lowered by 2 million bushels to stand at 4.9 billion bushels. With a slightly lower residual and no change to exports and crush, ending stocks are unchanged from last month at 550 million bushels. The season-average soybean price is unchanged at $10.80/bushel. The next WASDE report will be released on 8 November.

HOUSTON (ICIS)–Rates for shipping containers from east Asia and China to the US continued to fall after a lengthy strike was averted at US Gulf and East Coast ports and as peak season volumes have largely been pulled forward. The International Longshoremen’s Association (ILA) strike lasted just three days, and market analysts expect backlogs created by the work stoppage to be cleared up in two to three weeks, or even less at the Port of New York/New Jersey. Some ports extended gate hours to allow more time for containers to be delivered or picked up. Nathan Strang, the US Southwest director of ocean freight for Flexport, said the company is seeing relatively fluid terminal operations and railroad operations. Strang said all detentions and demurrage rules from the Federal Maritime Commission (FMC) remain in effect but noted that time frames for detention and demurrage restarted on 7 October after the strike ended. CONTAINER RATES FALL Global average rates for shipping containers continued to fall, according to multiple analysts. Supply chain advisors Drewry has its World Container Index (WCI) at $3,349/FEU (40-foot equivalent unit), which is down by 4% and shown in the following chart. Drewry said Shanghai to Los Angeles container rates fell by 5%, and Shanghai to New York rates fell by 3%, as shown in the following chart. Following the tentative deal between the ILA and the ports, Drewry expects rates ex-China to continue to decrease marginally in the coming weeks. Online freight shipping marketplace and platform provider Freightos said rates fell by a larger degree, but its rates had been higher. Judah Levine, head of research at Freightos, said carriers are also planning to reduce deployed capacity on the transatlantic trade lane later in the month in the hope of preventing rates from falling back to the $1,600-1,800/FEU level they had maintained for much of the year. “With the strike over and peak season demand largely behind us from a significant pull forward of volumes in the last couple months, transpacific container rates should continue to ease on the seasonal lull in volumes between peak season and Lunar New Year,” Levine said. 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. They also transport liquid chemicals in isotanks. LIQUID TANKER RATES UNCHANGED US chemical tanker freight rates held steady again this week for most trade lanes, even though vessel demand is growing for some routes. Most rates from the major chemical hubs remain sideways as a good portion of the market were attending the European Petrochemical Association (EPCA) conference in Berlin. The USG to Asia lane was also quiet following holidays. Although it is likely that increased exports ex–USG will be seen going into Europe and Asia, primarily as clean petroleum products (CPP) tonnage continues to focus on alternative cargoes in the petrochemical space, thereby adding to spot availability, which is already well supplied. On the transatlantic front, the eastbound leg is expected to warm up with cargoes being quoted including styrene to ARA from several US Gulf ports. With additional reporting by Kevin Callahan Visit the ICIS Logistics – impact on chemicals and energy topic page

HOUSTON (ICIS)–Some ports in Florida have resumed operations while millions in the US state remain without power after Hurricane Milton made landfall earlier in the week, south of the fertilizer hub of Tampa. A few ports in Florida have maintained Port Condition Zulu, under which they are closed to inbound and outbound vessels. Others have reopened and have set Port Condition IV, which is a hurricane seasonal alert to which ports return after a storm. The following table summarizes the port conditions in Florida. Port Status Condition Port of Pensacola Open Normal Port Panama City Open Draft restrictions Port St Joe Open Normal Port Tampa Bay Closed Zulu SeaPort Manatee Closed Zulu PortMiami Open IV Port Everglades Open IV Port of Palm Beach Open IV Fort Pierce Open with Restrictions IV with restrictions Port Canaveral Open IV Jaxport Open IV Port of Fernandina Closed Zulu Source: US Coast Guard OUTAGESFlorida has more than 2.2 million reported outages, according to the website poweroutage.us. That is down by more than 1 million versus the immediate aftermath of the hurricane. Prolonged outages can disrupt economic activity and slow down demand for plastics and chemicals. CSX WARNS OF RAIL DELAYSThe railroad company CSX warned of delays while it works to clear tracks, install generators and conduct repairs. All routes north of Jacksonville, Florida are open with no anticipated issues, it said. The area south, from Callahan to the north end of Anthony, is also clear. Work continues in central Florida, and CSX is addressing washouts on the Carter and Vitis subdivisions. The CFR line should be open later Friday night, providing a potential route into Winter Haven. CSX is making contingency plans for possible issues with a gas pipe washout near the Miami area. IMPACT ON FERTILIZERS, PHOSPHATES, CHEMSFor chemicals, there is some epoxy resin, phenolic resin and unsaturated polyester resin (UPR) production in Lakeland and Kathleen, Florida. Milton will make landfall far from Pensacola, Florida, which has plants that make nylon and thermoset resins. Tampa is an important hub for the US fertilizer industry, hosting corporate offices, trading, product storage, shipping and other logistical operations. Fertilizer producer Mosaic has its headquarters in Tampa. The company has not issued any statements regarding its corporate operations. A source at the fertilizer company Yara said it was shutting down its Tampa offices to comply with the evacuation orders. Near Tampa is Florida’s phosphate mining operations in Bone Valley, which covers parts of Hardee, Hillsborough, Manatee and Polk counties. In all, Florida has 27 phosphate mines, of which nine are active, according to the Florida Department of Environmental Protection. Canadian fertilizer producer Nutrien has yet to restart its White Springs phosphate operations following Helene, an earlier hurricane that made landfall farther north in Florida’s Big Bend region. On 30 September, Mosaic said its Riverview operations were off line following water intrusion from a storm surge caused by Hurricane Helene. Thumbnail Photo: Hurricane Milton. (By Cira/Noaa/Planet Pix via ZUMA Press Wire/Shutterstock)

LONDON (ICIS)–The risks for Germany’s chemical industry keep rising, economists said during a webinar hosted by chemical producers’ trade group VCI, and noted: Weak demand, domestically and abroad Investments stall Geopolitical uncertainty Contrary to hopes at the start of the year, Europe’s largest economy is likely to shrink for a second straight year in 2024, the government said this week in revising its previous 0.3% GDP growth projection to a 0.2% decline. The economy shrank 0.3% in 2023 and has not been able to generate strong growth since 2018. Weak or negative GDP trends translate into lower demand for chemicals. So far this year, demand for chemicals from nearly all domestic key customer industries, except food and paper, has been weak, said VCI economist Christiane Kellermann. Year-on-year % changes in domestic chemical sales, by major customer markets, January-August 2024: Construction: -3.9% Plastics: -4.5% Metal products: -7.4% Autos: -5.8% Food: +1.5% Glass, ceramics: -7.8% Paper: +0.9% Printing products: -7.3% Furniture: -7.3% Machinery: -8.3% Electrical equipment: -16.1% Source: VCI Many of the chemical industry’s customers in manufacturing are curbing their production, and in the important construction end market there is no noticeable recovery. Meanwhile, export sales of German chemicals were weak in most regions, with the exception of Asia, Kellermann said. Year-on-year % changes in chemical exports, by region, January-July: EU: -2.5% Non-EU Europe: -1.1% Asia: +1.8% North America: -3.6% Latin America: -3.4% Source: VCI INVESTMENTSThe low demand translates into low production rates and low capacity utilization. In fact, over the past two-and-half years chemical producers have been running plants at utilization levels that were below profitability thresholds, Kellermann said. As companies suffer low demand in Germany, with little prospect of improvement, and cannot run existing plants and equipment at profitable levels, it does not make sense for them to invest in new plants, she said. In a recent VCI survey, 74% of chemical companies said they were unlikely to invest in expanding production in Germany, she noted. Only 15% said they were likely to invest in expanding production while 9% were undecided, according to the survey. Companies cited the country’s bureaucracy and long project permitting processes, high energy and labor costs, and high and complicated corporate taxes as key obstacles to investing in Germany. Only 13% said that a lack of trained workers deterred them from investing in the country. With little or no new investment, “import pressures” rise and the chemical industry’s export capabilities will decline in coming years, she said. Germany’s chemical industry loses in international competitiveness, in particular in energy-intensive basic chemicals, she added. GEOPOLITICAL RISKS Michael Gromling, an economist from the German Economic Institute in Cologne, who was also presenting at the VCI webinar, estimated that in order to return to a meaningful growth path and achieve a recovery (“Aufschwung”), Germany needed to generate annual average GDP growth of 2.5% from 2025 through 2030. This, however, was “not realistic”, given the weakness across all industries and the geopolitical and structural challenges companies face, he said. The country’s industries were export-dependent and therefore sensitive to geopolitical tensions, trade conflicts and protectionism, he said. Geopolitical tensions were holding back investment decisions, and without a detente it would be very difficult for Germany to achieve its Aufschwung, he said. An end to the Ukraine war and peace in the Middle East would be a “game changer”, creating an opportunity for reviving the global investment cycle, he added. However, rather than relaxing, tensions could further sharpen after the 5 November US presidential election, he said. Gromling did not say which candidate – current Vice President Kamala Harris or former President Donald Trump – he sees as the greater risk. For the time being, VCI maintains its 2024 growth forecast for the country’s chemical-pharmaceutical production unchanged at 3.5% (excluding pharma: +5.0%). If realized, the increase would only partially offset last year’s 7.9% production decline (excluding pharma: -10.4%). However, VCI may cut its 2024 sales forecast of 1.5% as exports were trending weaker than expected, Kellermann indicated. Focus article by Stefan Baumgarten Thumbnail image source: VCI

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.