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Ammonia22-Jan-2025
SAO PAULO (ICIS)–Brazil’s
fertilizers-intensive agricultural sector is
expected to produce 322.3 million of grains,
pulses, and oilseeds in the 2024-2025 harvest,
up 8.2% year on year, according to the National
Supply Company (Conab).
Soybean production will continue dominating
Brazil’s agro sector as exports are expected to
keep rising, with a sharp recovery in output
after a lower-than-expected harvest in the
previous period.
In 2024-2025, Brazil’s is expected to produce
more than 166 million tonnes of soybean, up by
more than 11% from the prior harvest.
The country’s warm weather and its fertile land
allows for two harvests a year in some grains,
such as corn for which total production is
expected at 119.6 million tonnes in 2024/2025,
up 3.3%.
Rice output is also expected to rise sharply in
the current cycle, up 13.2% to 11.99 million.
The 2023-2024 cycle was greatly disrupted by
weather events such the historic floods in Rio
Grande do Sul state in May 2024 as well as
high temperatures and a
severe drought in other parts of the
country.
In 2024, Brazil’s harvest stood at 292.7
million tonnes, down 7.2% from 2023.
“After a year of crop failure, the current
cycle tends to recover the average productivity
of crops. For this season, an average yield of
3,509 kilograms per hectare (kg/ha) is
expected, compared to 3,201 kg/ha recorded in
2023/2024,” said Conab.
“The planting of the oilseed occurred in a
concentrated manner, mainly from the end of
October. As a result, the harvest should also
occur, for the most part, from the end of
January. The weather conditions, in the period
analyzed, have been favorable for the crop so
far.”
WORLD BREADBASKETAfter
dips in the previous cycle, Brazil’s grain
exports, which have made it a key breadbasket
for the world’s markets, are expected to regain
much of the ground lost.
In 2024-2025, soybean exports are expected at
105.47 million tonnes, up from the prior
cycle’s 98.6 million tonnes. Among others,
China is one of the key consumers of Brazilian
soybean, which the country uses mostly to feed
livestock.
Corn exports are expected to fall as domestic
consumption rises, said Conab, with shipments
overseas expected at 34 million tonnes, down
from 38.5 million tonnes – the result of a
higher, 86.4 million tonnes consumption by
Brazilian consumers, up from 83.57 million
tonnes in the previous cycle.
“An important addition to rice on Brazilians’
plates, total bean production is also expected
to grow by 4.9%, estimated at 3.4 million
tonnes, the second largest harvest in the last
15 years, behind only the 2013/2014 season,”
said Conab.
“The result reflects both the increase in area
and productivity. In the first legume harvest
alone, the harvest is expected to increase by
15.5%, estimated at just over 1 million tonnes.
The harvest of this first cycle of the crop is
underway, with 19.4% completed in the first
week of January.”
Polycarbonate22-Jan-2025
LONDON (ICIS)–The Packaging and Packaging
Waste Regulation (PPWR) has passed into law
following its publication in the Official Journal of
the EU on Wednesday.
The PPWR was certain to pass into law following
the EU Council vote in December, but the date
of publication marks the date the legislation
comes into force. This date is important for
several of the clauses.
For example, the EU Commission will be required
to review the state of technological
development and environmental performance of
bio-based plastic packaging within 3 years of
the commencement of the PPWR.
The PPWR is one of the most significant pieces
of legislation for the packaging and recycling
value chains in decades and will fundamentally
reshape both industries in the coming decades.
The wide-ranging regulation introduces:
• Mandated packaging recyclability
• Minimum recycled content and reuse targets
across packaging, albeit with potential
derogations based on availability of recycled
material
• Mandatory deposit return schemes (DRS) and
separate packaging collection targets
• New reporting and labeling obligations
• Extension of extended producer responsibility
(EPR) schemes
• Restriction on placing on the market of
food-contact packaging containing per- and
polyfluorinated alkyl substances (PFAS) above
certain thresholds
• Restriction on plastic collation films except
for transportation purposes
• Possibility of bio-based plastic contributing
to recycling targets
• Allowance of imports to count toward
recycling targets provided they are of similar
quality as domestic material and have been
separately collected
More details on the scope and impact of the
PPWR can be found here.
ICIS assesses more than 100 grades
throughout the recycled plastic value chain
globally – from waste bales through to pellets.
This includes recycled polyethylene (rPE),
recycled PET (rPET), rPP, mixed plastic waste
and pyrolysis oil. On 1 October, ICIS launched
a recycled polyolefins agglomerate price range
as part of the Mixed Plastic Waste and
Pyrolysis Oil (Europe) pricing service. For
more information on ICIS’s recycled plastic
products, please contact the ICIS recycling
team at recycling@icis.com.
Benzene21-Jan-2025
HOUSTON (ICIS)–US President Donald Trump did
not propose any new tariffs on his first day in
office, but he did issue an executive order
that calls for his administration to conduct
the investigations needed to impose them under
several sections of the law – in many cases,
repeating the same playbook Trump used during
his first term in office.
While the investigations take place, the US
can use the threat of possible tariffs to
negotiate agreements. If the negotiations fail,
the US would have taken the steps necessary to
respond with tariffs.
Trump did indicate that he is considering
imposing tariffs on Canada and Mexico as early
as 1 February. This could rely on using
existing laws in unprecedented ways.
The US chemical industry is vulnerable to
tariffs because it has deficits in commodities
such as benzene, melamine and methyl ethyl
ketone (MEK). Its large exports of plastics
make it vulnerable to retaliatory tariffs.
TRUMP LAYS FOUNDATION FOR
TARIFFSAmong the investigations
that will be launched by
Trump’s executive order, those into
national security could lead to Section 232
tariffs, which Trump imposed on steel during
his first term.
Discriminatory trade practices would open the
door to Section 201 tariffs, which were imposed
on washing machines and solar panels.
Unfair trade practices could lead to Section
301 tariffs. The US imposed these against
numerous Chinese imports. That unleashed a
trade war, with China imposing retaliatory
tariffs, many of which targeted US exports of
plastics and chemicals.
POSSIBLE NEW
TARIFFSTrump’s first-day order
pointed to other reviews that his
administration could complete faster and lead
to new tariffs imposed under different sections
of the law.
These could fall under the International
Emergency Economic Powers Act of 1977 (IEEPA),
Section 338 and Section 122.
Trump’s first-day order did not mention these
specific laws, but it did mention national
security, discriminatory actions against US
products and balance of payment deficits – all
issues that these laws were designed to
address.
These laws could allow Trump to impose tariffs
on a faster schedule. The IEEPA only requires
consultation with Congress, and Section 1222
can apparently be imposed unilaterally,
according to the American Action Forum (AAF), a
think tank.
THREAT OF CANADIAN, MEXICAN TARIFFS ON
1 FEBRUARYTrump would need such
speed if he were to impose 25% tariffs on
Canada and Mexico goods on 1 February, a
possibility that he mentioned on Monday,
according to CNBC and other
publications.
Drug trafficking and immigration could provide
the national security basis needed under these
laws.
REVISITING THE PHASE 1 AGREEMENT WITH
CHINATrump’s first-day order
called for a review of the Economic and Trade
Agreement to determine if China is living up to
its end of the deal.
The agreement is more commonly known as the
phase one deal, and
the two countries signed it in January
2020.
It included commitments by China to
purchase more goods from the US; to adopt
policies that will protect intellectual
property; and to reduce pressure on companies
to transfer technology.
China has not fulfilled its import
commitments under the agreement, and
Trump’s order said the country could impose
additional tariffs in response.
US CHEMS VULNERABLE TO
TARIFFSUnless Trump carves out
exceptions, his proposed tariffs on China and
Mexico could raise costs for US chemical
producers.
Canada provides US refiners with heavier grades
of oil that are not produced in sufficient
quantities domestically for the nation’s
refineries. Canadian oil complements the light
grades of oil that the US produces in abundance
from its shale fields.
Regional US markets may rely on Canadian
imports because they are closer than the more
distant sources along the US Gulf. Those
customers will have to reroute their supply
chains if they want to avoid tariffs.
For the broader tariffs that Trump proposed in
his campaign, they could prompt countries to
impose retaliatory duties on US shipments of
plastics and chemicals.
The US is vulnerable to such tariffs because it
has large surpluses of many plastics and
chemicals, such as vinyl acetate monomer (VAM),
methanol, ethylene glycols (EG), polyethylene
(PE) and polyvinyl chloride (PVC).
Tariffs on Chinese imports of rare earth
materials would increase production costs for
catalysts.
Tariffs on fluorspar and hydrofluoric acid (HF)
could increase costs for US producers of
fluorochemicals and fluoropolymers.
Insight article by Al
Greenwood
(Thumbnail shows cranes and containers, which
make up important infrastructure used in
international trade. Image by
Costfoto/NurPhoto/Shutterstock)
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.
Speciality Chemicals21-Jan-2025
HOUSTON (ICIS)–Ports in Houston and New
Orleans were closed on Tuesday because of
winter weather and are likely to remain closed
through Wednesday.
Port Houston closed all facilities on Tuesday,
and they will remain closed through Wednesday
because of a winter storm that
brought snow and icy conditions to the region.
Container terminal truck gates closed Monday
afternoon and vessel operations were suspended
later that evening.
“We potentially will resume vessel operations
at the container terminals on Wednesday
evening, if conditions allow,” port officials
said around midday on Wednesday.
Port Houston has committed to opening gates at
7 am on Saturday to assist customers with
ingate closing at 5 pm.
At Port NOLA in Louisiana, a freeze plan was
enacted on Sunday that halted water flow to
terminals, which is expected to resume on
Wednesday.
The New Orleans terminal said it was closed on
Monday for the Martin Luther King Jr holiday.
“We will determine opening the gates on
Saturday, 25 January once the weather has
passed,” terminal operators said.
Container and breakbulk operations at Ports
America are closed today and on Wednesday.
Port Freeport said it expects vessel activity
to be limited on Tuesday because of the
weather.
Port Houston is the busiest port in vessel and
barge movements and the largest US port by
tonnage, with more than 200 docks and 270
facilities.
It is also the top US port for petroleum and
the fifth largest container port in terms of
TEUs (20-foot equivalent units) in 2022.
The port is also home to the largest
petrochemical manufacturing complex in the
nation.
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.
Ethylene21-Jan-2025
HOUSTON (ICIS)–Cold weather in the US Gulf
Coast on Tuesday is expected to disrupt
petrochemicals operations in Texas and
Louisiana as companies take preventive
measures.
Temperatures fell sharply overnight from Monday
and are expected to stay lower than the average
for the time of the year in coming days, with
potential rain, sleet and snow.
The Houston metropolitan got snow in the early
hours of Tuesday. The city is to record
freezing temperatures all nights this week to
Friday (see bottom table).
CHEMICALS PLANTSUS Gulf
Coast crude and petrochemicals players’
memories of the last disrupting cold snap in
2024 and winter storm Uri in 2021 are still
fresh, with many fearing similar disruption
this week as key petrochemicals hubs in the
area are set to witness a similar cold snap.
In such a scenario, companies have done all
they could to minimize the disruption, although
some factors could be outside their control
despite the preparations.
Germany’s chemicals major BASF said in a
written response to ICIS late on Monday that
its operations in Freeport, Texas, would
“continue to run at as much capacity as
possible” but conceded that potential snowfall
could greatly complicate access to and from the
site.
As of Monday, BASF said: “[Due to the snow]
roads possibly being impassable. As a result,
BASF will have ride out crews arriving Monday
evening and remaining until conditions improve,
which is expected to be on Wednesday late
morning,” said a spokesperson for the company.
“Non-critical employees will work from home.
The BASF site in Vidalia, Louisiana, will idle
operations beginning Monday evening with a
planned restart of Wednesday at noon.”
As Houston recorded heavy snowfall overnight,
BASF was enquired again about its impact on
Freeport, but the company had not responded to
the request at the time of writing.
BASF’s spokesperson added the company’s sites
in Geismar and North Geismar, in the state of
Louisiana, would continue to run as normal.
In another written response to ICIS, a
spokesperson for Brazil’s polymers major
Braskem said the company had activated its
severe weather preparedness plan for its assets
in La Porte, Seadrift, and Oyster Creek, all in
Texas.
“We will continue to monitor the severe weather
and follow our protocols to ensure our team
members and assets are safe during this time.
We are working with our clients to minimize the
impact of this weather event,” it added.
A spokesperson for CPChem also said the company
was monitoring the weather and “taking steps to
prepare” its plants for any potential impact.
A spokesperson for European chemicals major
INEOS said the company’s olefins, polyethylene
(PE) and polypropylene (PP) units “have
initiated winter storm” protocols.
LyondellBasell would not comment. A
spokesperson for the company said to ICIS: “As
a matter of practice, we don’t provide specific
details about our units, operational status,
production figures, or supply for competitive
reasons.”
Pre-emptive shutdowns and operational
disruptions reported so far include:
BASF TotalEnergies cracker shuts down due to
weather
Formosa shuts Louisiana PVC
unit ahead of freeze
GCGV Portland, Texas, EG site down ahead of
freezing temperatures
Indorama’s Clear Lake, Texas, EG site
down for winter
weather
Indorama Lake Charles cracker shut due to weather
Indorama shuts Port Neches,
Texas, cracker ahead of winter storm
Indorama’s Port Neches, Texas, EG unit
down ahead of
winter weather
Ingleside, Texas, cracker shut before winter
storm
LACC Lotte/Westlake Louisiana cracker and
EG unit down ahead of
winter weather
Lyondell Channelview, Texas, crackers
flaring on
operations issues
Lyondell La Porte, Texas, cracker
sees
weather-related flaring
THREAT OF POWER OUTAGES AND GAS
OUTAGESWhile industrial plants
can avoid direct damage from cold weather, they
can still be subject to power outages or the
loss of natural gas supplies.
If the forecasts for sleet and snow hold true,
then this could cause powerlines to snap.
Spikes in demand for heating can overwhelm the
power grid in Texas, leading to widespread
blackouts.
Chemical plants and refineries rely on
electricity to power motors and pumps.
As of Tuesday, power supply should be
sufficient to meet demand through 28
January, according to the Electric
Reliability Council of Texas (ERCOT),
which manages the flow of electricity in most
of the state.
The electricity grid in Texas was holding up
reasonably well as of Tuesday morning, with
nearly 48,000 power outages recorded according
to Poweroutage.us.
The figure is reasonably low for Texas’ grid
standards and was much lower than the more than
80,000 outages reported in California, a US
state with similar population to Texas which is
still reeling from wildfires around Los
Angeles.
Cold temperatures can also affect the flow of
natural gas, potentially causing freeze-offs
during which water or hydrates freeze or can
create blockages.
One such freeze-off caused on
Monday a
shutdown of a scrubber at an amine
treater in Winkler county in west Texas,
according to a filing with the Texas Commission
on Environmental Quality (TCEQ).
Low temperatures could disrupt operations at
the plants that process natural gas.
Since 2021, cold weather has disrupted US
natural gas production during every winter,
according to the Energy Information
Administration (EIA).
PROLONGED STRETCH OF FREEZING
TEMPERATURESThe following table
shows the weather forecast for the Houston
metropolitan area this week, with temperatures
listed in Fahrenheit first and, in brackets, in
Celsius.
Tuesday
Wednesday
Thursday
Friday
High
36 (2.2)
42 (5.6)
48 (8.9)
52 (11)
Low
22 (-5.6)
29 (-1.7)
29 (-1.7)
37 (2.8)
Source: National Weather
Service
Eric Berger, an analyst at Houston’s weather
blog Space City Weather, said on Tuesday that
infrastructure disruption should have cleared
by Wednesday morning, although in some
locations it may last practically all day.
“After a cold start, high temperatures on
Wednesday are expected to reach 40 degrees
[Fahrenheit] or even a little warmer under
sunny skies. The combination of mostly sunny
skies and sublimation should allow for roads to
mostly dry out, but for some locations, this
may not happen until after noon,” said Berger.
“I realize the uncertainty is no fun, but such
snow and ice events are relatively rare in
Houston, so we are working on limited data
about local roads and their response to icy
conditions. Most of Houston will fall into the
upper 20s [Fahrenheit] on Wednesday night.”
Front page picture: Houston’s suburbs after
heavy snowfall overnightSource:
Adam Yanelli/ICIS
Additional reporting by Al Greenwood, John
Donnelly and Melissa Wheeler
Crude Oil21-Jan-2025
LONDON (ICIS)–Germany’s economic outlook
deteriorated in January on the back of a
bleak GDP forecast and increasing
inflationary pressures, research group ZEW said
on Tuesday.
The ZEW Indicator for Economic Sentiment fell
by 5.4 points from
the previous month to 10.3 points.
Source: ZEW
The group said that two consecutive years of
recession, with GDP contracting in 2023 and
2024, had caused expectations to fall.
In December, Germany’s central bank
cut its 2025 and 2026 GDP growth
projections for the country.
A lack of private household spending and
subdued construction demand continue to stall
Germany’s economy, the group’s president Achim
Wambach said in a statement.
“If these trends continue in the current year,
Germany will fall further behind the other
countries of the eurozone.”
Domestic political uncertainty and a so-far
unpredictable economic policy from the
new Trump administration in the US also
contributed to weaker sentiment, Wambach added.
The current economic situation indicator for
Germany rose slightly by 2.7 points but was
still firmly in negative territory at (minus)
-90.4 points.
In the wider eurozone, the January outlook was
more positive with a 1.0 point rise in the
economic sentiment indicator to 18.0 points.
The current situation was 1.2 points higher
than in December but still negative at (minus)
-53.8 points.
“The ZEW index is in line with the sentiment
expressed in the
December PMI numbers, which signaled that
the European economy remains weak despite our
expectations of a pick-up in momentum,”
advisory firm Oxford Economics added in a
statement.
Crude Oil21-Jan-2025
SINGAPORE (ICIS)–Shares of petrochemical firms
in Asia and China’s commodity futures markets
closed mixed on Tuesday, with no
immediate announcement of new tariffs from
the US on the first day of Donald Trump’s
second term as president.
South Korea’s LG Chem closed 4.75% lower in
Seoul , while Japan’s Mitsubishi Chemical
finished 1.85% higher in Tokyo.
China’s state oil and gas firm PetroChina was
down 1.40%, while chemicals major Sinopec ended
down 1.62% in Hong Kong.
The CSI 300 Index, a benchmark for Chinese
mainland shares, edged up 0.08% to close at
3,832.61.
Japan’s benchmark Nikkei 225 rose by 0.32% to
settle at 39,027.98, while South Korea’s KOSPI
Composite Index ended 0.08% lower at 2,518.03.
Hong Kong’s Hang Seng Index finished the
session 0.91% higher at 20,106.55.
Singapore’s Straits Times Index (STI) was
trading 0.27% lower at 3,797.61 at 08:44 GMT.
Analysts said that markets have already
pre-digested the “Trump effect”.
In his presidential campaign, Trump had
threatened to impose
tariffs on all US imports.
His first four-year term as US president in
2017-2021 sparked the US-China trade war.
In China, six out of nine petrochemical futures
markets posted declines on Tuesday.
CNY/tonne
21-Jan
% change from previous
session
Linear low density polyethylene (LLDPE)
7,808
-0.3%
Polyvinyl chloride (PVC)
5,304
0.6%
Ethylene glycol (EG)
4,753
-0.2%
Polypropylene (PP)
7,400
-0.7%
Styrene monomer (SM)
8,520
0.0%
Paraxylene *
7,420
-0.1%
Purified terephthalic acid (PTA)*
5,192
-0.2%
Methanol*
2,591
0.6%
Polyethylene terephthalate (PET)*
6,388
-0.2%
Sources: Dalian Commodity Exchange,
*Zhengzhou Commodity Exchange
Overall trading activity in China’s
petrochemical markets is waning as many players
have suspended trading to prepare for the
upcoming Lunar new year holiday, which will
last eight days from 28 January.
($1 = CNY7.28)
Additional reporting by Nurluqman
Suratman
Petrochemicals21-Jan-2025
MUMBAI (ICIS)–State-run Bharat Petroleum Corp
Ltd (BPCL) has secured loans worth Indian rupee
(Rs) 318.0 billion ($3.7 billion) for its
refinery expansion and petrochemical project at
its Bina site in the central Madhya Pradesh
state.
The company signed an agreement with a
consortium of six lenders led by state-owned
State Bank of India (SBI) for the loan, it said
in a bourse filing on 17 January.
In addition to SBI, the consortium of lenders
includes Punjab National Bank, Union Bank of
India, Canara Bank, Bank of India, and
Export-Import Bank of India.
The loan amount accounted for about 65% of the
total project cost of Rs489.3 billion.
The project will increase the refinery’s
capacity by more than 41% to 11 million
tonnes/year.
It will also include a petrochemical complex
comprising a 1.2 million tonnes/year ethylene
cracker unit and will have units to produce
downstream petrochemical products including
linear low density polyethylene (LLDPE), high
density PE (HDPE), polypropylene (PP), bitumen,
benzene as well as gasoline, diesel and
aviation turbine fuel.
The company expects to commission the project
by the fiscal year ending March
2028.
Once operational, the new complex will
significantly reduce India’s dependence on
petrochemical imports, BPCL chairman and
managing director G Krishnakumar said.
In August 2024, BPCL chose US-based Lummus to
provide technologies for the ethylene cracker
and downstream units at the Bina complex.
($1 = Rs86.52)
Benzene21-Jan-2025
HOUSTON (ICIS)–US President Donald Trump
proposed no new tariffs on his first day of
office, and instead instructed his
administration to investigate the nation’s
trade deficit and other areas of trade policy.
The absence of any tariff proposal marks a
contrast to his campaign platform and his
subsequent threats after winning the election.
Tariffs would expose the US chemical industry
to disruptions in trade flows, increased costs
for chemicals in which the nation has deficits
and the threat of retaliatory tariffs on
its exports of polyethylene (PE),
polyvinyl chloride (PVC) and other plastics and
chemicals.
Instead of proposing tariffs,
Trump issued a memorandum that called for
the following:
The Secretary of Commerce to investigate
the nation’s deficit and its consequences to
the economy and to national security.
The Secretary of the Treasury to
investigate the creation of an External Revenue
Service to collect tariffs and duties.
The US Trade Representative to investigate
any unfair trade practices.
The US Trade Representative to prepare for
the July 2026 review of the United
States-Mexico-Canada Agreement (USMCA), which
is the name of the countries’ trade agreement
that replaced NAFTA.
The US Secretary of the Treasury to
investigate exchange rates.
The US Trade Representative to review and
recommend revisions to existing trade
agreements.
The US Trade Representative to negotiate
bilateral or sector-specific agreements to open
markets.
The Secretary of Commerce to review
policies and regulations regarding antidumping
and countervailing duty laws.
A review of several trade issues with
China, including the Economic and Trade
Agreement. This is also known as
the phase one agreement, under which
China failed to fulfil its import
commitments.
The absence of first-day tariff proposals does
not mean that Trump will not make any later in
his presidency. In some cases,
the US president has the authority to
propose them even without investigations.
For example, the International Emergency
Economic Powers Act (IEEPA) of 1977 allows the
president to propose tariffs that would address
a severe national security threat. It requires
only a consultation with Congress.
During Trump’s presidential campaign, he
proposed the following tariffs:
Baseline tariffs of 10-20% on all imports.
Tariffs of 60% on imports from China.
A reciprocal trade act, under which the
US would match tariffs that other countries
impose on its exports.
After winning office, he threatened to impose
tariffs of up to 25% on imports from Canada and
Mexico and up to 10% on imports from China.
Thumbnail image: Inauguration Ceremony for
President Donald Trump in Washington, District
of Columbia, United States – 20 January 2025
(By Chip Somodevilla/UPI/Shutterstock)
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