SAO PAULO (ICIS)–Here are some of the stories from ICIS Latin America for the week ended on 1 November. Brazil’s chemicals trade deficit keeps rising; producers entrust recovery to higher tariffsBrazilian chemicals producers’ market share continued to be threatened in the January-September period, with the industry’s trade deficit rising to $36.2 billion, up 1% year on year, the country’s chemicals producers trade group Abiquim said this week. Brazil’s chemicals output up 2% in September, plastics and rubber up 6.5%Brazil’s chemicals output rose by 2% in September, year on year, although it fell compared with August by 2.7%, the country’s statistics office IBGE said on Friday. Brazil’s manufacturing keeps momentum in October, export orders robustBrazil’s petrochemicals-intensive manufacturing sectors continued expanding in October, the tenth consecutive month of growth, analysts at S&P Global said on Friday. Mexico’s manufacturing recovers slightly in October but poor demand keeps it contractionMexico’s petrochemicals-intensive manufacturing sectors continued to contract in October, although it slightly improved its performance month on month, analysts at S&P Global said on Friday. Colombia’s manufacturing output booms in October, central bank cuts rates to 9.75%Colombia’s petrochemicals-intensive manufacturing sectors made a decisive return to growth in October on the back of a healthy increase in new business, analysts at S&P Global said on Friday. Brazil’s chemical producer prices up nearly 11% in SeptemberBrazil’s chemicals producer prices rose in September by nearly 11%, year on year, as the sector recovers, the country’s statistics office IBGE said this week. Mexico’s GDP recovers strongly in Q3, more rate cuts dependent on US election – analystsMexico’s GDP grew by 1% in Q3, quarter on quarter, confirming the economy “pulled out of the slump” of the first half of the year, analysts said on Wednesday. Brazil’s Braskem Q3 resin sales down 2% due to higher PE and PVC stocksResin sales in Braskem’s domestic market dropped by 2% in Q3 year on year, mainly due to the higher levels of polyethylene (PE) and polyvinyl chloride (PVC) stocks in the transformation chain, the Brazilian petrochemicals major said on Wednesday in its quarterly production and sales report. Brazil Petrobras to continue advancing nitrogen project in Tres LagoasBrazil producer Petrobras announced that its board of directors has decided to continue implementing the nitrogen fertilizer unit (UFN-III), located in Tres Lagoas, Mato Grosso do Sul. PRICINGDomestic, international PE prices steady to lower on falling US export offersDomestic, international polyethylene (PE) prices were assessed as steady to lower across Latin American countries on the back of competitive offers from the US. Domestic PP prices fall in Colombia, Mexico on lower feedstocksDomestic polypropylene (PP) prices fell in Colombia and Mexico tracking lower feedstock costs. US October propylene contracts settled at a decrease on falling spot prices. Brazil hydrous ethanol sees small rise, anhydrous stays steadyPrices for hydrous ethanol saw a slight increase at the lower end of the range, with demand demonstrating stable sales in Q4. Chile and Colombia PET CFR prices decline amid Asia price reductionsChile and Colombia’s CFR prices fell on the lower end of the range reflecting the recent price reduction in Asia.

LONDON (ICIS)–Click here to see the latest blog post on Chemicals & The Economy by Paul Hodges, which looks at the upcoming US election. 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. Paul Hodges is the chairman of consultants New Normal Consulting.

HOUSTON (ICIS)–Here are the top stories from ICIS News from the week ended 1 November. SHIPPING: Union, US East Coast ports to resume negotiations in November Union dock workers and US East Coast port operators will resume negotiations on a new master agreement in November, according to a joint statement from both parties. Canada dock workers to launch new strike on Thursday Dock workers at the Port of Montreal in Canada will go on an indefinite strike at two container terminals, starting Thursday, 31 October, 11:00 local time, labor union and industry officials confirmed. INEOS Styrolution announces closure of US Ohio ABS facility In the ICIS news story headlined “INEOS Styrolution announces closure of US Ohio ABS facility” dated 30 October 2024, please see corrected figures in paragraph 8. INSIGHT: Harris v Trump – how the US presidential election could impact chemicals and energy markets Note: This is part two of this article. Click here to read part one. With around a week to go, all eyes are turned to the US presidential elections as the race heats up. LyondellBasell may make 2026 FID on US chemical recycling plant LyondellBasell could make a final investment decision (FID) in 2026 on a second chemical recycling plant, which it may build in the US at its refinery site in Houston, the CEO said on Friday.

BARCELONA (ICIS)—The eurozone manufacturing economy is still contracting, albeit at a slightly slower pace, according to new purchasing manager indices (PMIs) which mark the longest downturn since data collection began in 1997. The HCOB Eurozone Manufacturing PMI for October rose to 46 from 45 the previous month, still well below the 50 threshold which separates expansion from contraction, according to S&P Global which compiles the monthly survey. Production volumes decreased in October for the nineteenth straight month while output was constrained by a further marked decline in new factory orders, leading workforce numbers to be reduced further. On a positive note, contractions in production, sales and employment eased, although business confidence slipped to a one-year low. The contractions remained sharp in Germany and France, the eurozone’s largest economies, weighing down the result. Moderate deterioration was seen in Italy and the Netherlands, although a renewed improvement at Irish factories was recorded. Greece continued to display resilience, with a Manufacturing PMI above the 50.0 mark for a twenty-first month running. The top performer was once again Spain, which posted its fastest improvement in industrial conditions since February 2022. Factory output continued to decrease across the euro area in October. Although the rate of contraction has cooled since September, it was broadly in line with the average seen over the current 19-month sequence of decline. Production lines were once again squeezed by a lack of incoming new work. Total new order inflows shrank at the start of Q4, although the extent of the fall was the softest since June. Eurozone manufacturers once again trimmed purchasing activity, as they have done every month since July 2022. Amid this sustained tapering of input buying, pre-production stocks shrank at a sharp rate. Nevertheless, surveyed firms reported delivery delays from suppliers for a second month running. Employment was cut further at the start of Q4. Despite easing, the rate of job shedding held close to September’s 49-month record. Another marked drop in staffing capacity came amid a further sharp fall in backlogged work and a deterioration in business confidence. Eurozone manufacturers’ growth expectations were at their weakest in a year. Manufacturing costs fell in October, with these being passed on to customers as charges for goods leaving the factory gate were discounted to the greatest extent in six months. Commenting on the PMI data, Cyrus de la Rubia, chief economist at Hamburg Commercial Bank, said, “There is one bit of good news in these numbers: the recession in the manufacturing sector did not deepen further in October. Production dropped at a slower pace than in the previous month, and new orders fell less sharply.” He added, “It is not encouraging that inventory drawdowns for purchased materials continue at an unusually high pace. The ongoing reduction in inventories is obviously related to the fact that companies purchased and stockpiled materials and intermediate goods at an unprecedented scale in 2021 and 2022.” The economist pointed out that sluggish global demand gives companies no reason to restock, which in turn weighs on the economy. “The environment in the industry remains deflationary. This is good news for the purchase departments, but it seems companies are forced to pass on the corresponding price reductions in full to their customers. This points to fierce competition… We assume that China plays an important role here.” Thumbnail photo: Shutterstock

LONDON (ICIS)–Here are some of the top stories from ICIS Europe for the week ended 1 November. Europe post-industrial bale price rises further squeeze R-PP margins Europe recycled polypropylene feedstock post-industrial bale values rose by €50/tonne in October, further squeezing already narrow margins in the downstream flake and pellet sector. Europe isocyanates consumption remains constrained Consumption for different isocyanates in the European market continues to be constrained with no major uptick forecast for the near term. Versalis’ moves show how Europe petrochemicals has reached tipping point Europe’s petrochemical industry has reached a tipping point. Supply glut gives Europe PO buyers “good power to negotiate” annual contracts Propylene oxide (PO) contract negotiations for 2025 are progressing slowly as buyers forecast good supply and are keen to secure more favorable terms. Europe MMA braced for sluggish and slowing Q4 Players in Europe’s methyl methacrylate (MMA) market are bracing themselves for sluggish demand in Q4, and a picture that is set to slow further as the year end approaches.

SINGAPORE (ICIS)–Oversupply and higher freight costs are driving down petrochemicals demand in India, with trades likely to remain subdued after the Diwali holidays. Prolonged monsoon season hurt pre-Diwali demand Seasonal demand lull begins mid-November US election worries weigh on Indian rupee Demand traditionally picks up post-Diwali but a prolonged monsoon season, coupled with ample inventories, has led to a lack of import demand which is unlikely to change for the rest of the year. India was on holiday on 31 October to 1 November for Diwali or the Hindu festival of lights. Sentiment among market players was mixed, with some hopeful that post-holiday demand will pick up in certain products like polyvinyl chloride (PVC) ahead of implementation of import certification deadline under the Bureau of Indian Standards on 24 December. Demand lull typically sets in after the holiday, particularly for the pharmaceutical and manufacturing sectors, until end-November, when operations are ramped up in preparation for the summer holidays – between May and August. Overall production in the south Asian country typically increases along with demand in the January-March period – India’s fiscal Q4. For isopropanol (IPA), India’s import demand will be dented by antidumping duties (ADDs) imposed on Chinese cargoes. In the ethanolamines and acrylonitrile butadiene styrene (ABS) markets, domestic supplies remains ample, with post-Diwali demand likely to remain soft. India is a major importer of Chinese petrochemicals. It has been adopting protectionist measures against Chinese exports amid an oversupply in the world’s second-largest economy, whose own domestic demand is weak. US ELECTIONS A CONCERN India’s economy is slowing down, causing the rupee (Rs) to depreciate, with petrochemical import discussions scant amid ample inventories. A weaker currency makes imports expensive. The rupee plummeted to a near-record low of Rs84.075 against the US dollar on 31 October, partly on uncertainties over the US elections results. The Reserve Bank of India (RBI) had intervened to limit the rupee’s fall, selling US dollars to stem the loss and allowing it to climb back from a record low of Rs83.79, according to newswire agency Reuters. At 05:08 GMT, the rupee was trading at Rs84.03 against the US dollar. There are concerns that intra-Asian exports by China would increase on the possibility of further US punitive tariffs on Chinese products if Donald Trump was elected a second time as US president. His administration in 2017-2021 kicked off the US-China trade war in 2018. Trump is running under the Republican ticket against Democrat Kamala Harris in the US elections, which will be held on 5 November 2024. Focus article by Jonathan Yee Additional reporting by Veena Pathare, Clive Ong, Angeline Soh, Aswin Kondapally, Hwee Hwee Tan and Pearl Bantillo

SINGAPORE (ICIS)–Oil prices rose by more than $1/barrel on Monday as oil cartel OPEC and its allies (OPEC+) delayed a planned December production increase by a month, and amid fears of an escalating conflict between Iran and Israel. China slowdown behind OPEC+ decision to delay output hike China Jan-Sept crude imports down 2.8% on year Mideast geopolitical tensions support market At midday, Brent crude rose by $1.12/barrel to $74.22/barrel, while US crude was up by $1.14/barrel at $70.63/barrel. Eight OPEC+ countries, led by Saudi Arabia and Russia, had intended to begin returning to producing 180,000 barrel/day from December. Instead, the group decided on 3 November to extend a plan for a 2.2 million barrel/day cut until at least the end of 2024. OPEC+ had previously delayed increasing production in October on weak demand from China’s faltering economy. China is the world’s second-biggest economy and the biggest importer of crude. Its crude imports on a year-on-year basis have been shrinking for five consecutive months, with September volume down 0.6% at 45.5 million tonnes. For the first nine months of 2024, China’s total crude imports declined by 2.8% year on year to 412.4 million tonnes, official data showed. China’s industrial profits in September, meanwhile, slumped by more than 27% year on year. “While the [output hike] delay until January does not change fundamentals significantly, it does potentially leave the market having to rethink the strategy of OPEC+,” Dutch bank ING said in a note on Monday. “However, our balance continues to show that the market will be in surplus through 2025 unless OPEC+ continues with cuts through next year,” ING added. OPEC+ will next meet on 1 December. MIDEAST TENSIONS RISE Fears of growing unrest in the Middle East were also behind Monday’s crude gains on a potential retaliatory strike by Iran on Israel. Iran’s Supreme Leader Ayatollah Ali Khamenei promised retaliation against Israel on 2 November, following an attack by Israel that missed Iran’s energy and oil supplies on 26 October. The US and Israel has warned Iran against any retaliatory attack. Focus article by Jonathan Yee Thumbnail image: At the Qinzhou Port in in south China’s Guangxi Zhuang Autonomous Region – 22 October 2024. (Xinhua/Shutterstock)

SINGAPORE (ICIS)–Here are the top stories from ICIS News Asia and the Middle East for the week ended 1 November. Oil slumps as Mideast supply disruption concerns ease; China data weighs By Jonathan Yee 28-Oct-24 13:05 SINGAPORE (ICIS)–Oil prices tumbled by more than $4/barrel on Monday morning as fears over potential supply disruptions in the Middle East eased, with sentiment weighed down by a sharp contraction in China’s September industrial profits. Rising China phenol supply to continue to dampen market By Yoyo Liu 29-Oct-24 12:26 SINGAPORE (ICIS)–After hitting a year-to-date high on 10 September, China’s domestic phenol prices fell significantly, especially after the National Day holiday (1-7 October), due to expectations of increasing supply. Long supply, weak demand hound China benzene market By Yoyo Liu 29-Oct-24 15:15 SINGAPORE (ICIS)–China’s domestic benzene prices fell by 15% over a two-month period due to increased supply and a weaker-than-expected demand – market conditions that are likely to persist in November. Asia BDO sees some support from China; long-term outlook uncertain By Corey Chew 30-Oct-24 16:14 SINGAPORE (ICIS)–The Asia 1,4-butanediol (BDO) market recently saw an uptrend in the local China market due to strict production cuts. UPDATE: Japan’s Sumitomo Chemical trims fiscal H1 net loss; eyes LDPE output cut By Pearl Bantillo 30-Oct-24 19:11 SINGAPORE (ICIS)–Sumitomo Chemical trimmed its fiscal H1 to September 2024 net loss to Japanese yen (Y) 6.5 billion ($42 million), aided by sales growth of about 5%, while it seeks to rationalize operations to boost profitability. UPDATE: SCG invests $700 million in Vietnam’s LSP ethane enhancement project By Fanny Zhang 31-Oct-24 15:09 SINGAPORE (ICIS)–Thailand’s Siam Cement Group (SCG) will invest $700 million to pave the way for Vietnam’s first integrated petrochemical complex to use US ethane as feedstock for production. China SM producers regain margins, draw downstream support By Aviva Zhang 01-Nov-24 16:19 SINGAPORE (ICIS)–China’s non-integrated styrene monomer (SM) plants’ margins hit year-to-date highs on 30 October given widened product price spread over feedstock benzene, with expectations that end-user demand will pick up in November.

HOUSTON (ICIS)–Shipping container rates from east Asia and China to the US West Coast rose this week, reversing a trend that saw rates fall by almost 36% from July, as late-season holiday demand emerged. Many importers had pulled holiday volumes early to avoid any problems related to a US East Coast dock workers strike that was set to begin on 1 October. Judah Levine, head of research at online freight shipping marketplace and platform provider Freightos, said front-loading of volumes to the East Coast in September may have been stronger than to the West Coast due to the rush to beat the 1 October strike deadline. Supply chain advisors Drewry has Shanghai-USWC rates edging higher by less than 1% and said of the increase in spot rates ex-China that it expects this trend to continue as the Christmas rush intensifies. Drewry’s World Container Index showed average global rates rising, as shown in the following chart. Rates from Shanghai to Europe rose more dramatically than those from Shanghai to the US, as shown in the following chart from Drewry. Levine said the stronger front loading of volumes to the East Coast could explain the sharper drop of East Coast rates over the last few weeks, as well as the anomaly that saw East Coast rates fall below West Coast rates. Rates to the East Coast are typically about $1,000/FEU (40-foot equivalent units) higher than to the West Coast. Drewry still has East Coast rates about $400/FEU higher than West Coast rates. Levine noted that rates to both coasts are still $1,000-1,500/FEU above their April lows. 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. EAST COAST LABOR UPDATE Union dock workers and US East Coast port operators will resume negotiations on a new master agreement in November, according to a joint statement from both parties. The International Longshoremen’s Association (ILA), representing the dock workers, and the United States Maritime Alliance (USMX), which represents the ports, reached a tentative agreement on 3 October that ended a three-day strike. The strike was paused until 15 January after parties agreed on the salary portion of the agreement, essentially meeting in the middle. Levine said port automation remains the major sticking point, and if there is no progress in the coming weeks anxious shippers may start increasing orders again ahead of another possible strike. CANADA WEST COAST PORT LABOR UNREST The British Columbia Maritime Employers Association (BCMEA), which represents ports on Canada’s west coast, has issued formal notice of its intention to lock out port workers coastwide, starting Monday, 4 November at 8:00 local time, it said on Friday. On Canada’s east coast, dock workers at the Port of Montreal on Thursday, 31 October, went on an indefinite strike at two of the port’s four container terminals. The labor dispute is about automation at Dubai Ports World (Canada), as well as retirement benefits. The parties have been negotiating a new collective labor deal since the last one expired in March 2023. LIQUID CHEM TANKER RATES STABLE US chemical tanker freight rates were largely unchanged this week for most trade lanes, while vessel demand continues to be soft for various routes. The USG to ARA remains soft and solid for contractual cargoes and any additional available CPP tonnage could continue to pressure the market even further. Similarly, that situation exists for volumes on the USG to the Caribbean and South America trade lanes. From the USG to these regions, space among regular carriers remains available, due to a lack of interest. However, for the USG to Asia spot volumes continues to be weak as there seems to be plenty of prompt space available.  Mainly parcels of methanol to China seems to have provided any support to the weak market. Additionally, ethanol, glycols and caustic soda were seen in the market in various directions. With additional reporting by Stefan Baumgarten and Kevin Callahan Visit the ICIS Logistics – impact on chemicals and energy topic page