HOUSTON (ICIS)–Here are the top stories from ICIS News from the week ended 13 December. Dow’s $2.4-3.0 billion infrastructure deal larger than expected Dow signed a deal to sell a minority stake in its US Gulf Coast infrastructure assets to a fund managed by Macquarie Asset Management for up to $3.0 billion – larger than expected, according to UBS. PCC’s proposed USG chlor-alkali unit to add caustic length in unique development US caustic soda supplies will continue to grow in the coming years following an announcement by PCC Group that it intends to invest in a new 340,000 tons/year chlor-alkali plant at DeLisle, Mississippi. The new capacity will be built on Chemours site at DeLisle Mississippi with the intent to provide Chemours with reliable access to chlorine. The company intends to sell its caustic soda to strategic partners and into the open market. Construction on the unit is expected to begin in early-2026 and conclude in 2028. INSIGHT: New gas pipeline to provide support for ethane prices for US chems 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. Olin to shut diaphragm chloralkali capacity that serves Dow’s Freeport PO unit 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. ACC expects modest US chemicals volume recovery in 2025 – economist The American Chemistry Council (ACC) expects a 1.9% rebound in chemical volumes in 2025 after two consecutive years of declines as the US economy undergoes a soft landing and the housing market improves in the second half of the year, its chief economist said.

LONDON (ICIS)–Click here to see the latest blog post on Chemicals & The Economy by Paul Hodges, which looks at the likely colder weather ahead. 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.

LONDON (ICIS)–The eurozone private sector ended the year on a bearish note as output contracted driven by a weakening manufacturing sector, which offset a return to growth for services. The eurozone purchasing managers’ index (PMI) stood at 49.5 for December, according to flash data for the month, an improvement from 48.3 in November but still below growth territory. A PMI score of above 50.0 signifies growth. Continuing manufacturing sector weakness drove the contraction, and more than offset a rebound in service sector productivity to 51.4, a two-month high, following the contraction last month. After a difficult, low-demand year, the manufacturing sector ended 2024 at a 12-month low of 44.5, according to S&P Global. “The manufacturing sector’s situation is still pretty dire,” said Cyrus de la Rubia, chief economist and Hamburg Commercial Bank, which helps to assemble the eurozone PMI data. “Output fell at a quicker pace in December than at any other time this year, and incoming orders were down too. The destocking cycle in inventories shows no sign of stopping either,” he added. Manufacturers cut back purchasing activities in the sharpest monthly decline of input buying in 2024, while pricing fell for the industry, but at the slowest rate since values started to decline four months ago. More robust global PMI data for the previous month indicates that conditions may be stabilizing internationally, which could become a balancing force for the eurozone if momentum continues, de la Rubia said. Markets have been buffeted by a recent government collapse in the eurozone’s two largest economies, Germany and France, but the prospect of new governments forming earlier than expected could provide some upside potential for 2025, he added. “If future governments manage to chart a clear course, there could still be positive surprises next year. Eurozone companies were actually slightly more confident than in November that business activity will be higher a year from now than it is today,” he said. Manufacturing sector momentum also slowed in the UK, with sector PMI falling to 47.3 in December compared to 48.0 in November, an 11-month low. Overall flash composite PMI numbers for the country ticked up to 50.5, driven by an uptick in service sector output, but the figures still point to an economy that has run aground in the fourth quarter. Conditions could become chillier still going into 2025, according to Chris Williamson, chief business economist at S&P Global Market Intelligence. “While the December PMI is indicative of the economy more or less stalled in the fourth quarter, the loss of confidence and increased culling of jobs hints at worse to come as we head into the new year,” he said. Slowing growth increases pressure for the Bank of England to roll out further rate cuts this week but, with inflation rising steadily, the central bank’s monetary policy committee has ample reason for caution, he added. Focus article by Tom Brown. Thumbnail photo: An automotive plant in Bremen, Germany (Source: Shutterstock)

LONDON (ICIS)–Here are some of the top stories from ICIS Europe for the week ended 13 December. Little improvement expected for German chems sector in 2025- VCI Germany’s chemicals and production is expected to have increased by 2% in 2024, while output growth is set to slow next year, sales could stagnate and prices fall, trade group VCI said on Friday. Ample supply for crude markets in 2025 despite stronger demand – IEA 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. INEOS pushes forward with Greensand carbon storage project INEOS and project partners Harbour Energy and Nordsofonden have made a final investment decision (FID) to move forward with the first commercial phase of the Greensand carbon storage project. Dow’s $2.4-3.0 billion infrastructure deal larger than expected Dow signed a deal to sell a minority stake in its US Gulf Coast infrastructure assets to a fund managed by Macquarie Asset Management for up to $3.0 billion – larger than expected, according to UBS. EU-Mercosur trade deal to support R&D in green chemicals – Brazil’s Abiquim EU and Mercosur chemicals will greatly benefit from trade without barriers as per their free trade agreement (FTA) which will also encourage much-needed research and development (R&D) in new technologies for greener chemicals, Brazil’s chemicals producers’ trade group Abiquim said.

SINGAPORE (ICIS)–South Korea’s benchmark stock market index was closed lower on Monday, snapping four straight days of gains, after the country’s parliament impeached President Yoon Suk Yeol over the weekend for imposing a short-lived martial law on 3 December. The KOSPI composite index slipped 0.22% to settle at 2,488.97, with shares of major petrochemical companies closing mixed. The Korean won (W) eased against the US dollar at W1,437.68 as of 08:00 GMT, weaker than the previous session’s closing of W1,435.45. The won had plunged to an almost two-year low of above W1,440 to the US dollar when Yoon declared martial law late on 3 December which lasted about six hours. South Korea’s National Assembly on 14 December voted 204-85 to impeach Yoon for imposing martial law, which plunged the country into political instability and economic uncertainty. A two-thirds majority was required to approve the motion, which was the second one filed after the first motion on 7 December failed. Yoon’s political duties have been suspended pending a Constitutional Court decision, which is expected in 180 days, on whether to re-instate or remove him from office. Prime Minister Han Duck-soo became the acting President upon Yoon’s impeachment, stating that his mission is to “swiftly stabilize the confusion in state affairs” during a Cabinet meeting. Han talked to outgoing US President Joe Biden by phone on 15 December, reassuring him that “South Korea will carry out its foreign and security policies without disruption”, according to a statement from Han’s office. EYES ON 2025 Separately, finance minister Choi Sang-mok on Monday said he has written a letter to financial institutions and world leaders to explain the government’s response to the recent political situation and to request their trust and support in the South Korean economy. During an emergency ministerial meeting on 15 December, strategies were heard for economic stabilization and growth in the short- and long-term. For one, the finance ministry will announce its economic policy direction for 2025 by the end of the year, along with a mid- to long-term strategy to be released in January 2025. Meanwhile, the Ministry of Trade, Industry and Energy (MOTIE) is also drafting support measures for the petrochemical industry in preparation for the Trump-led US government in January 2025, which is threatening to impose tariffs on all imported goods. The US, along with China, is a major trading partner of South Korea. South Korea’s measures are expected to take effect in Q1 2025. The country – which is a major exporter of ethylene and aromatics, such as benzene, toluene and styrene monomer (SM) – is reeling from a combination of weak external demand and overcapacity in China. (updates closing levels for index, share prices; adds details throughout) Thumbnail image: South Korean Prime Minister Han Duck-soo, who assumed office as acting president after the parliamentary impeachment of President Yoon Suk-yeol, speaks to reporters at the government complex in central Seoul, South Korea, 15 December 2024. (YONHAP/EPA-EFE/Shutterstock)

SINGAPORE (ICIS)–A feasibility study for a joint venture petrochemical complex in the Duqm Special Economic Zone (SEZ) in Oman will be completed in 2025, an official from Oman’s national oil and gas company OQ told ICIS. The proposed project is a joint venture between OQ, Saudi Arabia’s SABIC and Kuwait Petroleum International (KPI). “We are trying to maximize the value of hydrocarbons in Oman,” OQ’s vice president for business development Sultan Al Burtamani said in an interview with ICIS. “We are studying this project together with our other partners, and hopefully in the coming months we’ll get clarity on how we will be moving the project to the next stage,” Al Burtamani said. The OQ8 Duqm refinery, which became operational in 2024 and cost $9 billion to build, has a capacity of 230,000 barrels per day. The Duqm Petrochemical Complex, when built, will be located close to the Duqm Refinery, which is operated by OQ8, which is an existing joint venture between OQ and KPI. The project will draw feedstock primarily from the refinery. Oman, as with other Gulf states such as Saudi Arabia and the UAE, is looking to diversify away from oil and gas production, which accounts for over half of the nation’s GDP. “We are studying what could make a commercial competitiveness for us in the petrochemical space, [perhaps] related to the cracker business, that we are thinking of expanding,” Al Burtamani said. “We are trying to develop Duqm as another industrial hub, which is what we did in (the port cities of) Sohar, Sur, and Salalah (in Dhofar).” Al Burtamani added that Duqm is an attractive location as it has direct access to the Indian Ocean. Duqm is in the southeast Al Wusta Governorate of Oman and is in the path of international shipping lines in the Indian Ocean and the Arabian Sea. At the recently concluded Gulf Petrochemicals and Chemicals Association (GPCA) Forum in Muscat, Oman, OQ chairman Mulham Basheer Al Jarf said that a privatization program for the state-run company, which includes the listing of its chemicals arm OQ Base Industries (OQBI), forms part of Oman’s 2040 Vision plan to diversify its economy. OQBI launched an initial public offering (IPO) on 24 November, with 49% of the total shared capital of the company offered at 111 baizas per share or a total of Omani rial (OR) 384 million ($1 billion). The company started trading on the Muscat Stock Exchange on 15 December. OQBI produces methanol, ammonia, propane, butane, condensate and liquefied petroleum gas (LPG) in a facility in Salalah. Interview article by Jonathan Yee ($1 = OR0.384829)

SINGAPORE (ICIS)–Here are the top stories from ICIS News Asia and the Middle East for the week ended 13 December. S Korea bourse extends fall as political woes deepen; petrochemical shares slump By Pearl Bantillo 09-Dec-24 15:36 SINGAPORE (ICIS)–South Korea’s benchmark stock market index continued to bleed on Monday amid political instability wrought by the shock martial law announcement on 3 December, with impeachment motions against President Yoon Suk Yeol dropped over the weekend due to lack of quorum. INSIGHT: India poised to take up growing role in Asia ethylene ecosystem By Josh Quah 09-Dec-24 18:22 SINGAPORE (ICIS)–As far as the numbers on paper go, India may not look like a conspicuous power in the ethylene markets. The south Asian country imported around 76,400 tonnes of ethylene in 2022, a figure that dropped to around 51,800 tonnes in 2023. China Nov export growth slows to 6.7% on year; imports fall 3.9% By Jonathan Yee 10-Dec-24 15:37 SINGAPORE (ICIS)–China’s exports in November grew at a slower year-on-year rate of 6.7% to $312.3 billion amid trading headwinds from a potential wave of tariffs to be levied by the incoming US administration. INSIGHT: Key takeaways for 2025 petrochemical market outlook at ICIS China customer day By Jenny Yi 10-Dec-24 19:15 SINGAPORE (ICIS)–A slow projected global recovery, the growing prominence of Africa and southern America for producers, and a bearish outlook for Asia olefins and aromatics prices in 2025 were among the topics discussed at the ICIS China Customer Day event in Shanghai on 21 November. Asian SBR import offers see support from firming upstream markets By Ai Teng Lim 11-Dec-24 13:18 SINGAPORE (ICIS)–Asian styrene-butadiene-rubber (SBR) producers are seeking to sell higher, citing upstream cost push. China to adopt looser monetary policy in 2025 as US tariffs loom By Jonathan Yee 11-Dec-24 15:36 SINGAPORE (ICIS)–China is expected to implement a “more proactive fiscal policy” and a “moderately loose” monetary policy for next year, according to the country’s top officials, amid economic headwinds and looming heavy tariffs from the US. UAE to impose 15% minimum top-up tax on large multinationals from Jan ‘25 By Jonathan Yee 12-Dec-24 12:28 SINGAPORE (ICIS)–The UAE will impose a minimum top-up tax (DMTT) on large multinational companies, to align its tax system to global standards. Strong PKO cost supports Asia fatty alcohol mid-cuts C12-14 By Helen Yan 12-Dec-24 13:50 SINGAPORE (ICIS)–Elevated feedstock palm kernel oil (PKO) prices and demand heading into 2025 are supporting Asia’s fatty alcohol mid-cuts C12-14 market. INSIGHT: Shift in rules on China phosphate ferts exports hit market sentiment By Rita Wang 12-Dec-24 19:50 SINGAPORE (ICIS)–A shift in the customs rules in China means that phosphate fertilizers will only be sold on the domestic market for the time being. However, sluggish demand as players work through winter reserves could stand to weigh on pricing. China domestic BD gains boost Asian market discussions By Ai Teng Lim 13-Dec-24 11:54 SINGAPORE (ICIS)–Sentiment is more upbeat this week in Asia’s spot butadiene (BD) import market amid recent strong gains in China’s domestic market.

HOUSTON (ICIS)–Planning to build their first US plant in Kentucky, Swedish producer Cinis Fertilizer announced it has been approved for tax incentives. The company said it is currently planning the construction of the company’s next production facility in Hopkinsville, Kentucky and has applied for both grants and tax incentives, nationally and locally. The Kentucky Economic Development Finance Authority (KEDFA) has preliminary approved a 15-year incentive agreement with Cinis Fertilizer under the Kentucky Business Investment program. For final approval and to receive the tax credits of up to $1.5 million, the company must invest about $109 million and meet annual targets such as creating 65 full-time jobs in Kentucky over 15 years and paying an average hourly wage of $38, including benefits. Additionally, KEDFA approved Cinis Fertilizer for up to $250,000 in tax incentives through the Kentucky Enterprise Initiative Act (KEIA). KEIA allows approved companies to recoup Kentucky sales and use tax on construction costs, building fixtures, equipment used in research and development and electronic processing. “We are grateful for the warm welcome we have received in Kentucky and look forward to contributing to the future of Hopkinsville,” said Jakob Liedberg, Cinis Fertilizer CEO. “Being granted these tax incentives is a great start and in parallel we are working on securing grants, where the processes and timelines are longer.” First announced in 2023, this will be the producer’s their third plant with the two other plants located in Sweden. The company has already signed a 10-year agreement with Ascend Elements, a leading American manufacturer of engineered battery materials, regarding the sourcing of sodium sulphate, and have arranged with potash producer K+S Minerals to purchase potassium chloride. This plant is scheduled to start in 2026, with it planned to have a capacity of up to 300,000 tonnes of potassium sulphate yearly.

HOUSTON (ICIS)–As consumer concern for product sustainability continues to spur both regulatory and voluntary action within the recycled plastics space, recycled polypropylene (R-PP) resin has risen in interest. US recycled plastics markets continue to develop new grades of R-PP in response to converter and brand company demand in the packaging and durables space. Despite the desire to incorporate higher percentages of R-PP into existing products, the unique challenges with polypropylene (PP) collection infrastructure and limitations on the mechanical recycling processes have hindered widespread or rapid adoption. For example, those seeking R-PP tend to request post-consumer based material with food-contact approval, as well as natural or transparent color so that products can be modified to maintain prior brand design. Supply of these types of feedstocks are extremely limited, largely due to the fragmented PP collection landscape and mixed application of PP in existing consumer packaging. Moreover, only a handful of recyclers have received Letters of Non-Objection (LNOs) from the US Food and Drug Administration (FDA). As of the latest update, slightly more than 20 individual companies have received one or more LNOs. As such, a natural, food-grade R-PP resin is priced at roughly two times the price of virgin PP. Prices for white or light gray R-PP are slightly lower than natural but are limited to various design applications and in some cases still hold a premium against virgin. Similarly, black and dark gray materials are typically not as sought after due to their design limitations and thus trade at a much lower price on weaker demand. Regardless of the aesthetic or regulatory hurdles, an additional barrier to adoption for post-consumer R-PP resin continues to be mechanical properties and performance. Based on the mix of incoming feedstock items from curbside bales, such as cups, tubs and lids of various colors, sizes and applications, the blended properties of the final resin typically range from 12-20 Melt Flow Index (MFI, also referred to as melt) and 1.2-1.7 Izod. Thus, packaging and product converters with specific manufacturing and performance requirements must then compound material to achieve the final resin material, inherently limiting the percentage of post-consumer recycled (PCR) content. As such, recyclers note there has been increased quoting activity for their R-PP portfolio, but still limited conversion to substantial order volumes. In addition, pricing continues to show wide ranges based on a myriad of factors, including material quality, color, volume, production capability and buyer/supplier market knowledge. Overall demand for PP PCR remains strong from end markets such as food and beverage and personal care, which are driven by both regulatory and voluntary recycled content targets. Other end markets such as horticulture, durables, automotive and construction are slower to adopt, and instead have historically pursued post-industrial or low cost virgin material due to cost-effectiveness. ICIS is currently prototyping US R-PP market coverage. Prototype reports target those involved in the processing and purchasing of PP bales as well as mechanically recycled post-consumer and post-industrial PP resin within the US. These reports have market discussion on pricing, supply, demand and current news, split by post-consumer vs post-industrial market categories. If you are interested in learning more about this coverage and or receiving these prototype reports, please reach out to Emily.Friedman@icis.com.