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Caustic Soda11-Jun-2025
HOUSTON (ICIS)–Researchers at Colorado State
University’s Weather and Climate Research
department maintained their prediction of an
above-average Atlantic hurricane season, with a
probability that 33% of major storms could make
landfall in the US Gulf.
The CSU team predicts 17 named storms during
the Atlantic hurricane season, which began on 1
June and runs through 30 November. Of those 17
storms, researchers forecast nine to become
hurricanes and four to reach major hurricane
strength of Category 3 or higher.
Hurricanes are rated using the Saffir-Simpson
Hurricane Wind Scale, numbered from 1 to 5,
based on a hurricane’s maximum sustained wind
speeds, with a Category 5 storm being the
strongest.
Saffir-Simpson Hurricane Wind
Scale
Category
Wind speed
1
74-95 miles/hour
2
96-110 miles/hour
3
111-129 miles/hour
4
130-156 miles/hour
5
157+ miles/hour
While still very early in the season,
researchers said it is showing characteristics
as seen in 1996, 1999, 2008, 2011, and 2021.
In 1996, there were six major hurricanes, which
was the most since 1950, but none entered the
US Gulf.
In 1999, five storms reached Category 4, with
none threatening the US Gulf. Storms in both
years made landfall on the US East Coast in
North Carolina.
Hurricane Ike, one of five major hurricanes in
2008, made landfall in Galveston near the
entrance to the Houston Ship Channel, causing
chemical plants and refineries in the region to
struggle to restart.
Hurricane Irene was the only hurricane to make
landfall in 2011, striking near Cape Lookout,
North Carolina. It was one of seven hurricanes
that season, of which four became major
hurricanes.
In 2021, there were 21 named storms with seven
becoming hurricanes, four of which were major
storms and several entered the US Gulf.
Hurricane Ida was the most destructive, making
landfall in Louisiana
and leading to many plant shutdowns.
The report also includes the following
probability of major hurricanes making landfall
in 2025:
51% for the entire US coastline (average
from 1880–2020 is 43%)
26% for the US East Coast, including the
Florida peninsula (average from 1880–2020 is
21%)
33% for the US Gulf Coast from the Florida
panhandle westward to Brownsville, Texas
(average from 1880–2020 is 27%)
56% for the Caribbean (average from
1880–2020 is 47%
Hurricanes directly affect the chemical
industry because plants and refineries shut
down in preparation for the storms, and they
sometimes remain down because of damage.
Power outages can last for days or weeks.
Hurricanes shut down ports, railroads and
highways, which can prevent operating plants
from receiving feedstock or shipping out
products.
Most US petrochemical plants and refineries are
on the Gulf Coast states of Texas and
Louisiana, making them prone to hurricanes.
Other plants and refineries are scattered
farther east in the states of Mississippi,
Alabama, and Florida – a peninsula that is also
a hub for phosphate production and fertilizer
logistics.
Additional reporting by Al
Greenwood
Liquefied Natural Gas11-Jun-2025
Egypt continues to ramp up LNG imports as
it lines up long-term LNG import capacity
Tenders could tighten the LNG balance, but
Egypt has a pattern of overbuying
Egypt is also in ongoing discussions to
secure LNG supplies from 2025-2028
LONDON (ICIS)–Egypt is ramping up its demand
for LNG imports, with a consequential impact on
the global LNG market.
Egypt has swung back to being an LNG importer
over the last year.
It is already seeking a high number of cargoes
this year, as well as planning further imports
between now and 2028.
Following a deal with majors TotalEnergies and
Shell earlier this year, its demand may be here
to stay.
“They initially [tendered for] over 100
cargoes, then it turned out to be 40-60
cargoes,” one source said, while two other
sources said around 40 cargoes were awarded.
Concerns about the potential market price
impact prompted Egypt to lower the number of
cargoes it sought in its most recent tender,
the source added.
With the previous 60 cargoes from TotalEnergies
and Shell, total 2025 demand could be around
100-120 cargoes, or around 7.0-8.4 million
tonnes of LNG – a significant increase in both
volume and pace compared with 2024.
This comes as Egypt is in ongoing discussions
to buy LNG supplies from 2025 to 2028, sources
said, with one saying that state-owned EGAS has
received 14 offers for supply ranging from 18
months to three years.
The cargoes in the latest 40-60 cargo tender
were heard awarded to Vitol, Shell, Hartree,
Aramco and “a few others” at a premium of
around $0.70/MMBtu to the benchmark TTF.
The premium reflects the country’s credit risk
and a nine-month deferred payment profile, one
trader said, which is longer than the six-month
deferred payment scheme seen in previous
Egyptian tenders.
“For Egypt, buyers need FOB cargoes, so there
is a natural premium to be paid in exchange for
losing flexibility,” a second trader said.
TIGHTER COMPETITION
Egyptian demand is expected to peak in summer,
when gas-for-power demand is higher due to
higher cooling needs.
“Total Egyptian demand this year is estimated
to be 110 cargoes,” one trader said, which
would equate to around 7.7 million tonnes of
LNG.
Another trader said that spot LNG discounts
into northwest Europe could narrow further
following the Egyptian tender.
“I think the [Egyptian tender] will make the
market tighter than expected. I expect the
discounts in Europe to narrow,” the trader
said.
A third trader said European LNG spot discounts
for July-August deliveries had already narrowed
slightly off the back of the Egyptian and
Argentinean buy tenders, although further
feedback this week suggests discounts are so
far stable.
The global LNG market is expected to face a
shortfall of 2.1 million tonnes over the
summer, according to ICIS LNG Foresight, while
2025 as a whole is projected to be oversupplied
by 3 million tonnes.
However, according to traders, it is
challenging to say if the Egyptian tenders have
been fully priced into the market due to
Egypt’s option to push back or divert cargoes,
potentially easing the call on LNG.
Some contracted cargoes for Q4 2024 were pushed
back to Q1 2025 or diverted due to
lower-than-anticipated demand.
“I am thinking that maybe their pattern is
always to overbuy. If no prompt demand, they
will defer [the cargoes],” one source said.
Egyptian President Abdel Fattah al-Sisi
recently directed the government to
“pre-emptively take whatever needs necessary to
ensure stable electricity flow”.
One report said that Egypt is negotiating to
import 160 shipments through June 2026, which
would represent another step up in imports from
the current pace and increase.
This comes as Egypt has also stepped up imports
of cheaper energy, securing one million tonnes
of fuel oil for delivery in May and June to
restart its legacy power stations over the
summer.
Ultimately, spot LNG demand versus supply will
be key in determining competitiveness between
hubs in the short term.
Asian demand has been low this year, especially
Chinese demand, with sufficient pipeline gas in
China denting downstream LNG demand.
LONG-TERM LNG IMPORT CAPACITY
Cairo’s latest moves to secure long-term import
capacity provide further evidence that it sees
domestic gas output remaining at low levels for
the foreseeable future.
ICIS senior LNG analyst Alex Froley said that
Egypt’s flip from a mid-sized exporter to a
significant importer has happened quickly.
“Even those expecting an increase in imports
would have been unlikely to factor in the
country hiring as many as four FSRUs in a short
space of time,” he said.
The Energos Eskimo FSRU recently
departed Jordan’s Aqaba terminal as it prepares
to begin a new 10-year charter with Egypt’s
EGAS, ICIS data shows.
The unit is expected to undergo some
modifications before starting operations later
this summer, one broker said.
Energos Eskimo will join the existing
Hoegh Galleon FSRU off Egypt, while
the Energos Power FSRU and a
BOTAS-chartered FSRU are also expected to be
deployed soon.
FUNDING GAP NARROWS
Traders have questioned how Egypt can afford
the number of tendered LNG cargoes, given its
reliance on Saudi Arabia and Libya to pay for
previous cargoes.
This financial challenge, compounded by years
of sluggish growth, is reflected in the
consistent premiums that Egypt has had to pay
in its LNG buy tenders.
However, local urea producers have ramped up
output and exports again in early June, an
important source of foreign exchange, following
periods of gas shortages.
Egypt has also taken further steps to cover
part of its funding gap, securing a $1.2
billion disbursement from the International
Monetary Fund (IMF) in January.
In May, the European Parliament reached a
provisional agreement to provide €4 billion in
macro-financial assistance to Egypt.
Together with the IMF programme for the
2024-2027 period, the assistance would help
Egypt cover “part of its external funding gap”,
the Parliament said.
Additional reporting by Clare Pennington
Ethylene11-Jun-2025
SINGAPORE (ICIS)–ADNOC Logistics &
Services (ADNOC L&S) on Wednesday said that
it has entered into a $531-million strategic
partnership with polyolefins major Borouge to
boost UAE’s production and export of
petrochemicals.
As part of the partnership, Borouge has awarded
ADNOC L&S a 15-year contract to manage
logistics on up to 70% of its annual
production, “which will increase significantly
following the completion of the Borouge 4 plant
expansion”, ADNOC L&S said in a filing on
the Abu Dhabi Securities Exchange (ADX).
ADNOC L&S is a unit of Abu Dhabi National
Oil Co (ADNOC), which holds a 54% stake in
Borouge. Borouge operates an integrated
polyolefin complex at Al Ruwais Industrial City
in Abu Dhabi.
“As Borouge plans to ramp up production
capacity by 1.4 million tonnes/year by the end
of 2026 through its Borouge 4 mega project,
Borouge will become the world’s largest
single-site polyolefin complex,” it said.
The agreement covers port management, container
handling, and feeder container ship services
for the Borouge container terminal in Al Ruwais
Industrial City.
ADNOC L&S will deploy a minimum of two
dedicated container feeder ships to transport
Borouge’s products from Al Ruwais to the
deepwater ports of Jebel Ali in Dubai and
Khalifa Port in Abu Dhabi.
“The mutually beneficial service agreement will
deliver a minimum guaranteed value of $531m,
supporting the next phase of Borouge’s
accelerated growth plans, driving operational
cost savings over the full contract term,” it
said.
The deal could lead to more than $50 million in
cost savings and efficiencies for Borouge in
the first five years alone enhancing the
company’s supply chain network, the company
added.
ADNOC L&S’ integrated logistics
capabilities include managing container
terminal operations, feeder services, and
logistics solutions to meet increasing global
demand.
Borouge is involved in an
upcoming merger with Austria’s Borealis and
Canadian producer Nova Chemicals which is
expected to be completed in the first quarter
of 2026.

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Petrochemicals11-Jun-2025
MUMBAI (ICIS)–India is currently planning
green hydrogen initiatives worth around Indian
rupees (Rs) 2 trillion ($23 billion), which
include tenders for 42,000 tonne/year green
hydrogen production by domestic oil refineries.
Indian Oil eyes Dec ’27 start-up for 10,000
tonne/year Panipat hydrogen unit
Two green ammonia projects start
construction in Odisha
Pilot projects initiated for
hydrogen-powered heavy vehicles
“Tenders for the production of 42,000
tonne/year have been floated by the refineries
while 128 more will be issued by state-owned
refineries based on the outcome of those
tenders,” Indian petroleum and natural gas
minister Hardeep Singh Puri had said in a post
on social media platform X on 6 June.
As part of the initiative, nine research and
development (R&D) or demo plants are under
construction and four have been commissioned by
state-owned Indian Oil Corp (IOC), Gail India
Ltd, Hindustan Petroleum Corp Ltd (HPCL), and
Bharat Petroleum Corp Ltd (BPCL), he added.
IOC, which is currently building India’s
largest green hydrogen plant with a 10,000
tonne/year capacity at its Panipat Refinery
Complex, expects to begin operations at the
plant by December 2027, the company had said on
30 May.
Once operational, the plant will “replace
fossil-derived hydrogen in refinery operations,
resulting in substantial reduction in carbon
emissions”, IOC added.
Separately, construction work has begun on two
green hydrogen and green ammonia projects at
the Gopalpur industrial park in the eastern
Odisha state.
Hygenco Green Energies Ltd plans to invest Rs40
billion to build a 1.1 million tonne/year green
ammonia plant at Gopalpur in three phases. It
expects to complete the first phase by 2027.
UAE-based Ocior Energy, meanwhile, is building
a 1 million tonne/year green hydrogen and green
ammonia plant at the Gopalpur industrial park
at a cost of Rs72 billion, Odisha’s state
government announced.
A 200,000 tonne/year plant will be built in the
first phase of operations by 2028, and a much
bigger 800,000 tonne/year unit will be
completed by 2030 in the eastern Indian state,
according to Ocior’s website.
The Gopalpur Industrial Park will also house
the ACME Green Hydrogen’s green ammonia
project, as well as a 1,500
tonne/day green ammonia project being set
up by the Avaada Group.
Separately, in a bid to grow India’s green
hydrogen infrastructure, the central government
also aims to decarbonize its transport sector
through the introduction of hydrogen-powered
trucks and buses.
The government expects to commission five pilot
projects for running these hydrogen-powered
vehicles by 2027, according to National Green
Hydrogen Mission (NGHM) director Abhay Bakre.
In March 2025, the government initiated these
pilot projects with participation from private
firms such as Tata Motors, Ashok Leyland,
Reliance Industries Ltd (RIL) as well as
state-owned IOC, HPCL and BPCL, among others.
As part of the project, the pilot routes have
been mapped out on 10 routes across the country
with nine hydrogen refuelling stations.
The government plans to deploy around 1,000
hydrogen-powered trucks and buses by 2030,
NGHM’s Bakre said.
The government expects to get “almost 50 trucks
and buses running this year”, he said, adding
that the numbers would increase further next
year.
While automakers such as Tata Motors, Ashok
Leyland, Mahindra & Mahindra, Hyundai have
announced plans to develop hydrogen-powered
vehicles, companies such as RIL, BPCL, IOC plan
to create green hydrogen refuelling
infrastructure.
Launched in 2023, NGHM with an initial
allocation of $2.4 billion, targets to have a
minimum hydrogen production capacity of 5
million tonne/year by 2030.
Since 2023, the government has allocated
862,000 tonne/year production capacity to 19
companies.
($1 = Rs85.60)
Focus article by Priya
Jestin
Ethylene11-Jun-2025
SINGAPORE (ICIS)–Economic growth in the East
Asia and Pacific (EAP) region is projected to
slow from 5% in 2024 to 4.5% in 2025 on
escalating global trade tensions and related
increases in policy uncertainty, the World
Bank said on 10 June.
Trade openness exposes EAP economies to
policy shifts
China’s growth outlook unchanged at 4.5%;
projected to slow through 2027
Global 2025 growth cut to 2.3%; slowest
since 2008
The global lender had earlier in January
projected a 4.6% growth for the EAP region’s
economy.
“Due to their high trade openness, EAP
economies are more exposed to trade policy
shifts,” the World Bank said in its June Global
Economic Prospects report.
“The downgrade reflects the impact of higher
tariffs on growth, which is expected to be
partly offset by policy support measures in EAP
economies, notably China.”
CHINA’S GROWTH TO
SLOWChina’s growth is expected
to decelerate to 4.5% in 2025, unchanged with
the prior forecast made in January, as “fiscal
support [is] assumed to offset the impact of
trade tensions with the US – China’s largest
market for exports,” the World Bank said.
China’s economy expanded by 5% in 2024.
A soft labor market and subdued property sector
in China are expected to weigh on consumption,
though cushioned by fiscal stimulus.
China’s growth is forecast at 4% in 2026 and
3.9% in 2027, “in line with decelerating
potential output growth, reflecting the effects
of slowing productivity growth, an aging
population, and high debt levels,” the World
Bank said.
For the EAP region excluding China, growth is
expected to ease to 4.2% this year, mainly due
to trade tensions.
Increased trade policy uncertainty, reduced
confidence, and spillovers from softer external
demand in major advanced economies and China
are likely to curtail exports and private
investment in the region.
East Asian economies are particularly
vulnerable to heightened uncertainty “because
of their relatively larger exposure to trade
and, therefore, higher shares of investment in
GDP,” the World Bank said.
Economies with large export-oriented
manufacturing sectors, including China,
Malaysia, Thailand, and Vietnam, are
particularly exposed.
While some economies will benefit from fiscal
policy support – like social spending and
public investment in Indonesia, Malaysia,
Thailand, and Vietnam – “the full macroeconomic
effects of higher trade barriers, which are
hard to predict, could weigh on growth,” the
World Bank cautioned.
Looking ahead, EAP growth is forecast to remain
subdued at 4% in both 2026 and 2027 as the
outlook for the region faces primarily downside
risks, with persistent policy uncertainty and
potential escalation of trade tensions being
key concerns.
Other significant risks include tighter global
financial conditions, spillovers from weaker
growth in major economies, heightened
geopolitical tensions, and natural disasters.
On the upside, a partial resolution of trade
tensions and reduced policy uncertainty would
likely boost regional growth prospects above
the baseline.
More expansionary fiscal policy in China or
major advanced economies could support
faster-than-expected activity.
Additionally, surging digital investment and
technological adoption could boost productivity
growth, as “major economies in the region rank
high in terms of readiness for AI adoption,
which could underpin stronger-than-expected
regional growth,” the World Bank added.
GLOBAL GROWTH FORECAST
SLASHEDThe global growth
forecast for 2025 has been cut by four-tenths
of a percentage point to 2.3%, marking the
slowest rate of global growth since 2008, aside
from outright global recessions.
By 2027, global GDP growth is expected to
average just 2.5%, the slowest pace of any
decade since the 1960s, the global lender
warned.
Global trade is projected to expand by 1.8% in
2025, a notable slowdown from 3.4% in 2024 and
significantly below the 5.9% average seen in
the 2000s.
This forecast includes tariffs implemented
through late May, such as the 10% US tariff on
imports from most countries, but does not
include tariff hikes announced by US President
Donald Trump in April and later delayed until 9
July for negotiations.
Focus article by Nurluqman
Suratman
Speciality Chemicals10-Jun-2025
HOUSTON (ICIS)–Arrivals of container ships
fell in May at the US West Coast ports of Los
Angeles (LA) and Long Beach (LB) amid a trade
war between the US and China but has shown a
slight uptick in June while the two nations
continue to negotiate a trade deal.
Kip Louttit, executive director of the Marine
Exchange of Southern California (MESC), said
the ports of LA/LB, said May container ship
arrivals were at 5.0/day, slightly below the
5.7/day that was the average prior to the
pandemic.
Through the first five days of June, arrivals
are at 5.6/day, which is still slightly below
the pre-pandemic norm.
Import cargo at the nation’s major container
ports is expected to surge in the near term
amid a pause in reciprocal tariffs between the
US and China, according to the Global Port
Tracker report released today by the National
Retail Federation (NRF) and Hackett Associates
as shown in the following chart.
NRF Vice President for Supply Chain and Customs
Policy Jonathan Gold said this is the busiest
time of the year for US retailers as they enter
the back-to-school season and prepare for the
fall-winter holiday season.
“Retailers had paused their purchases and
imports previously because of the significantly
high tariffs,” Gold said. “They are now looking
to get those orders and cargo moving in order
to bring as much merchandise into the country
as they can before the reciprocal tariff and
additional China tariff pauses end in July and
August.”
Gold said many retailers suspended or canceled
orders after US President Donald Trump
announced a 145% tariff on China in April but
have resumed imports after tariffs were reduced
to 30% and a 90-day pause that will last until
12 August was announced.
The higher reciprocal tariffs on other nations
have also been paused until 9 July as the
administration negotiates with those countries.
ASIA-US RATES SURGE
Rates for shipping containers from Asia to the
US have spiked over the past couple of weeks –
and have almost doubled over the past four
weeks – as demand has surged ahead of the
possible reinstatement of tariffs while
capacity remains tight.
Rates from supply chain advisors showed drastic
increases over the past two weeks, and weekly
rates from online freight shipping marketplace
and platform provider Freightos came out today
with Asia-USWC rates at $5,488/FEU (40-foot
equivalent unit) and at $6,410/FEU to the East
Coast.
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. Titanium dioxide (TiO2) is also
shipped in containers.
They also transport liquid chemicals in
isotanks.
Visit the US
tariffs, policy – impact on chemicals and
energy topic page
Visit the Logistics:
Impact on chemicals and energy topic
page
Thumbnail image shows a container ship.
Photo by Shutterstock
Potassium Chloride (MOP)10-Jun-2025
HOUSTON (ICIS)–Offshore potash marketing group
Canpotex announced it is fully committed on
volumes for potash sales through 30 September.
The group said this is due to continued strong
demand for potash, underpinned by solid
fundamentals for agricultural commodities and a
sustained focus on food security in many of
Canpotex’s key markets.
Canpotex is the offshore marketing company for
Saskatchewan potash producers Nutrien and
Mosaic and has been operating since 1972.
Speciality Chemicals10-Jun-2025
LONDON (ICIS)–Verbio’s ethenolysis plant under
construction in Germany is expected to start up
in 2026, a company official told ICIS.
The plant will produce renewable chemicals
based on rapeseed oil methyl ester.
“The distillation columns are in, all the
big-ticket items have been installed,” Marc
Siegel, Verbio’s head of sales, Specialty
Chemicals and Catalysts, said in an interview.
While there were some delays, the project at
the Bitterfeld chemicals park in Saxony-Anhalt
state remains on budget, he said.
Capacities:
– 32,000 tonnes/year of methyl 9-decenoate
(9-DAME)
– 17,000 tonnes/year of 1-decene.
Project cost: €80-100
million.
Startup: early 2026
“We are seeing a lot of interest in the
materials,” Siegel said.
9-DAME has applications in surfactants,
lubricants, solvents, polymers and others while
1-decene is a precursor for lubricants, coating
agents, surfactants, polymers and others.
Siegel also noted an opportunity to convert
9-DAME, which is similar to C10 fatty acid
methyl ester, into a C10 fatty acid or alcohol,
replacing palm kernel oil (PKO).
Customers would thus avoid the complex supply
chains of PKO, and its price fluctuations.
More important, however, they would reduce
their carbon footprint, and they could put
palm-free and GMO-free labels on their shampoos
and other products, he said.
Nongovernment organizations have created a lot
of pressure against palm oil because of the
environmental impacts of palm oil plantations,
he noted.
A NEW CHEMICAL INDUSTRY
“Customers see the value of these renewable
chemicals”, he said, adding that many companies
have strong decarbonization targets.
While Germany’s chemical industry was currently
in crisis, renewable chemicals was its
opportunity, he said.
“All the companies are hurting now, but once we
rebound, there will be a new chemical industry,
otherwise we will end up as an industrial
museum,” he said.
“Sustainability is the way to go, chemical
companies need to reinvent themselves in the
things they do,” he said.
For Verbio, the ethenolysis project is part of
its strategy to reduce its reliance on
biofuels, Siegel said.
Biofuels is a heavily regulated market that
leaves producers exposed to political
decisions, he said and noted the changes in
policies under the current US administration.
The diversification into renewable
chemicals will give Verbio additional
mainstays outside the transport sector, he
said.
While Verbio plans to focus on producing and
supplying the two renewable chemicals – 9-DAME
and 1-decene – it does not intend to get
involved in making downstream products, he
added.
Interview article by Stefan
Baumgarten
Thumbnail photo of Verbio’s ethenolysis
plant under construction at Bitterfeld,
Germany. Source: Verbio
Ethylene10-Jun-2025
SAO PAULO (ICIS)–Brazil’s trade union
representing auditors at the Federal Revenue
service, which are some of the best-paid civil
servants in the country, accepted late on
Monday the court’s ruling ordering the end of
their nearly seven-month strike, said
Sindifisco.
Ruling ends what most Brazilians just saw
as state-fueled privilege
Striking workers average salary:
$5,000/month; Brazil’s median: $400-500/month
The strike had started affecting the
state’s tax collection
While the judge’s
ruling ordering the end of the strike was
published over the weekend, as of Monday
morning Sindifisco maintained it had not been
officially notified yet.
In a written response to ICIS late on Monday,
the union said it had been notified and in
compliance with the “democratic state of law”
it would accept the ruling, but did not
disclose any details about more industrial
action for coming weeks.
The ruling put an end to one of the longest
strikes by civil servants in Brazil, started in
November, and a case which has showed some of
Brazil’s wrongs – civil servants paid multiple
times more than the average Brazilian,
complaining about the lack of salary increases.
The Federal Revenue auditors have mostly fought
this battle alone, and along the way they did
not gain any new friends.
For the government, the ruling puts an end to a
dispute which was becoming increasingly
negative for the economy – goods piling up in
customs points across Brazil’s vast geography –
as well as the state’s ability to collect the
taxes due on imports and exports.
Finance Minister Fernando Haddad said in
parliament in May that the strike was partly to
blame for the lower-than-expected tax proceeds
for 2025. The pressure was building up while
Sindifisco was becoming increasingly isolated
in its battle.
Chemicals and fertilizers players, as well as
most industrial companies, will have breathed a
sigh of relief over the weekend as their
concerns about trade flows
had for months been increasing.
The hangover from such an extended period of
industrial action is expected to be tedious and
things will take months, rather than weeks, to
normalize, most analysts think.
TIPPING POINTAs their
demands kept falling in deaf ears with the
government, Sindifisco stepped up the pressure
in early June, calling for an
even stricter industrial action.
It proved lethal for its demands. The cabinet
quickly puts its lawyers to work and convinced
a judge that the latest strike action was
affecting essential services that the state is
mandated to deliver, as well as tax receipts.
To make sure Sindifisco came around quickly,
the judge’s ruling set a daily fine of
Brazilian reais (R) 500,000 ($90,100) in case
of non-compliance by the union.
“Sindifisco states that it was formally
notified today [Monday 9 June] of the
preliminary decision of the Superior Court of
Justice (STJ) granted by Judge Benedito
Goncalves and, respecting the democratic rule
of law, it will respect the ruling,” it said in
its written statement late on Monday.
“The essential activities carried out by the
auditors will be protected, including the
suspension of standard operations in customs
units.”
In his ruling, the judge specifically mentioned
“standard operations”, which is nothing but a
euphemism which means auditors do still go to
work and in theory carry out their tasks, but
they do so at a much slower rate, amounting
practically to strike action as workloads pile
up.
Sindifisco said its legal affairs department is
evaluating “all applicable legal measures” to
discuss the court decision.
However, it did not respond to questions about
what its next strategy could be based on,
considering they have exhausted practically all
industrial actions possible, without succeeding
in their demands.
The union’s main demand is hefty increases in
wages to recoup the losses in purchasing power
accumulated since 2016, as they claim their
wages have been increased only once since 2016.
But even that clear and rather unfair
circumstance has not moved public opinion,
political parties or the cabinet to the
striking workers’ turf. The reason not
difficult to find: their already very generous,
taxpayers-funded wages.
STATE-FUNDED PRIVILEGEA
Federal Revenue auditor’s salary averages
R28,000/month ($5,000/month), gross before
taxes and social security contributions,
according to the Brazilian branch of jobs site
Glassdoor.
That, in Brazil, is earned by less than 1% of
the population. To make matters worse, those
salaries are paid by all taxpayers, most of
whom must endure low salaries and long days at
work – or take on two jobs – to make ends meet.
Wages for most Brazilians range between
R1,518/month – the legal minimum wage, widely
common in services jobs such as bars or shops –
and around R3,000/month.
The auditors’ salaries, which can also be found
in other high-ranking civil servant positions,
represent for many Brazilians the
centuries-old, state-funded privilege which
tends to be concentrated among white Brazilians
who come from high-income households and,
almost certainly, went to the country’s best
universities.
The 1950s idea of a new capital, Brasilia,
which would be able to bring together a
modernized and more inclusive version of all
Brazils was a lovely idea on paper – which
mostly stayed in the papers of idealists such
as famous architect Oscar Niemeyer and his
disciples.
As the decades went by, old habits died hard,
and Brasilia became a weird version – for good
and bad – of the Brazil they were trying to
change. Many of those Brasilia-based, well-paid
civil servants have come to live in bubbles and
are seen by most Brazilians as some sort of
state-sponsored caste.
No wonder the auditors’ plea… was never taken
too seriously for most Brazilians or even
considered just a bad joke. Opinion polls have
been telling that story for months, but
Sindifisco seemed to fail to grasp the
public’s mood and kept pushing.
After the weekend’s ruling gave it the upper
hand, the cabinet will be even less inclined to
make any concessions now as it tries to rein in
the fiscal deficit while keeping a good face in
terms of welfare state spending, a difficult
balance to start with.
But any public opinion’s perception that the
cabinet was giving in would have added to an
extended belief about some civil
servants: they have it better than most private
sector employees, not least because their jobs,
once they passed exams and obtain the
qualifications, are practically secured until
retirement. A generous state pension follows.
EXPECTED COMPETITIVE
ELECTIONBrazil will soon enter
an unofficial, year-long electoral campaign as
its nearly 160 million voters will be called to
the polls to choose a president and renew
parliament in October 2026.
Lula’s Workers’ Party (PT) and its governing
coalition appear to have slim chances to
revalidate their mandate as the PT’s core
voters – low-income households – have greatly
felt as of late the increase in basic items
such as food, as a larger share of their
spending goes to that.
The government will not want to upset any
potential voters by appearing to favor already
privileged civil servants. The election could
literally be decided by a few thousand votes,
so any potential voter turning away would not
be good news for the PT.
To make things more confusing, the PT has yet
to officially choose a presidential candidate
as its hegemonic leader of the past three
decades – Lula – keeps the incognita when
enquired about it.
And that is a rather strange circumstance,
especially as the age of another President,
that of US’ Joe Biden, became part of the
public conversation after his debate debacle in
June 2024.
Be it because the Brazilian center-left has not
been able to find a successor with the same
appeal than Lula or be it because in Brazil’s
idiosyncrasy blasting old age is considered
rather rude, Lula’s age has not become part of
the debate yet, at least to the same extent
than it did in the US.
Another strange circumstance as the signs of
aging are evident for all to see.
Biden was 81 during the debate. Lula would be
80 if he runs for re-election at the time of
the poll but, if victorious, he would be sworn
into office for a fourth term when he will have
already turned 81.
Front page picture source: Brazil’s Federal
Revenue press services
Focus article by Jonathan
Lopez
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