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Speciality Chemicals11-Jul-2025
HOUSTON (ICIS)–Rates for shipping containers
from east Asia and China to the US fell again
this week as demand has fallen after a brief
period of front loading during a pause in
tariffs.
With this week’s decreases, rates from Shanghai
to Los Angeles have fallen by more than 50%
over the past month, and rates from Shanghai to
New York have fallen by more than 33% over the
same time, as shown in the following chart from
supply chain advisors Drewry.
Rates from China to the US West Coast have
fallen faster than on other trade lanes because
of the surge in shipping capacity once the
Trump administration put a pause on extremely
high tariffs on goods from China.
But average spot rates from Asia to the US East
Coast are likely to fall faster
than rates to the West Coast and could be
within $1,000/FEU (40-foot equivalent unit) by
the end of July as carriers stop adding
capacity to the transpacific trade lane.
Average global rates continue to trend lower,
falling by 5% week on week as shown in the
following chart from Drewry.
Drewry expects spot rates to continue to
decline next week as well due to excess
capacity and weak demand.
Rates from online freight shipping marketplace
and platform provider Freightos also showed
significant decreases to both US coasts.
Rates to the West Coast are around $3,000/FEU
(40-foot equivalent unit) while rates to the
East Coast are around $5,000.
Judah Levine, head of research at Freightos,
said during a webinar this week that there
remains a lot of uncertainty in ocean freight,
especially since US President Donald Trump
extended the tariff deadline to 1 August.
“This three-week extension for reciprocal
tariffs could mean that importers from those
impacted countries will resume shipping
activities that maybe they are already getting
ready to pause if tariff hikes had materialized
this week,” Levine said. “But this short run by
only three weeks until August does not really
make it possible to move goods from Asia in
time.”
Levine said that carriers canceled general rate
increases (GRIs) for July and have mostly
suspended or reduced peak season surcharges
also aimed at July volumes.
Levine said some carriers have already begun to
remove capacity from the trade lane in efforts
to stop the rate deterioration.
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.
LIQUID TANKER RATES
UNCHANGED
US chemical tanker freight rates assessed by
ICIS were steady this week with rates
holding steady despite continuing to face
downward pressure on several trade lanes.
There is a downward pressure on rates along the
USG-Asia trade lane as charterers are still in
wait-and-see mode. Besides contract cargoes,
there is very little seen in the market. The
tariffs and looming uncertainty continue to
dampen the spot market, pressuring rates.
The usual spot cargoes of methanol from Jose to
China are the only ones reported, leaving
methanol requirements from the region active to
Asia. For the time being, larger parcels seem
to have found a floor in the $60/tonne range.
Similarly, rates from the USG to ARA and all
other trade lanes also held steady. The
previous uptick in activity which resulted from
the recent Israel/Iran hostilities appears to
have calmed and the market to Europe fell flat.
As a result, this route remained quiet this
week, which has placed downward pressure on
freight rates.
There have only been a few cargos fixed, a few
more outsiders have come on berth and are
working to fill space which has led to more
competition for regular owners. MTBE, methanol
and caustic soda are the most frequently
reported in the market.
From the USG to Brazil, this trade lane remains
unusually quiet and in turn rates seem to have
softened. Although availability for prompt
space seems to be somewhat tight but there is
plenty of open space for mid-July into August.
The USG to India route has not seen an uptick
in inquiries over the last week with no
confirmed fixtures. There was only one new
inquiry seen for 8,000-9,000 tonnes
Pascagoula/Mumbai for August dates. Along with
the other regions, freight rates are widely
viewed as softer.
Additional reporting by Kevin
Callahan
Visit the US
tariffs, policy – impact on chemicals and
energy topic page
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Impact on chemicals and energy topic
page
Ammonia11-Jul-2025
HOUSTON (ICIS)–The US Department of
Agriculture (USDA) said in the July World
Agricultural Supply and Demand Estimate (WASDE)
report that the outlook for corn is for lower
production and ending stocks, while soybeans
will have slightly reduced production and
exports but have increased ending stocks.
For the corn crop beginning stocks are
decreased by 25 million bushels to 1.3 billion
bushels, which the agency said reflects an
increase in exports that is partly offset by
lower feed and residual use.
Feed and residual use is down 75 million
bushels based on indicated disappearance in the
30 June grain stocks report. Exports have been
raised by 100 million bushels to 2.8 billion
bushels based on current outstanding sales and
shipments to date and, if realized, would be
record high.
Corn production is projected down by 115
million bushels on lower planted and harvested
area from the 30 June acreage report. The yield
is unchanged at 181 bushels per acre.
Total use is cut 50 million bushels with a
reduction for feed and residual use based on
lower supplies, and with supply falling more
than use, ending stocks are down 90 million
bushels.
The season-average farm price received by
producers is unchanged at $4.20 per bushel.
For soybeans, the July WASDE shows slightly
lower production, reduced exports, and
increased ending stocks compared to last month.
Soybean production is projected at 4.3 billion
bushels, down 5 million bushels from last month
on lower harvested acres and an unchanged yield
of 52.5 bushels per acre.
Exports were lowered by 70 million bushels to
1.75 billion bushels on higher domestic demand,
higher exports for Argentina and Ukraine, and
larger Brazilian supplies at the end of
September during the US peak export season.
With lower soybean exports partly offset by
higher crush, ending stocks are increased 15
million bushels to 310 million bushels.
The US season-average soybean price is
projected at $10.10 per bushel, down 15 cents
from last month.
The next WASDE report will be released on 12
August.
Hydrogen11-Jul-2025
LONDON (ICIS)–Germany’s Federal Ministry for
Economic Affairs and Energy (BMWE) has
reaffirmed its commitment to accelerating the
hydrogen economy, after a spate of recent
industry setbacks including steel manufacturer
ArcelorMittal’s cancellation of its renewable
hydrogen-based decarbonisation plans for two
steel plants.
A spokesperson for the ministry told ICIS on 3
July that BMWE regrets ArcelorMittal’s
cancellation but stressed that it was a private
sector decision and that none of the €1.3
billion government subsidy secured for the
project has been disbursed.
They reiterated the ministry’s support for
other major steel decarbonisation projects by
Salzgitter, Thyssenkrupp, and SHS, which have
collectively secured €5.6 billion in funding.
“Reducing electricity prices in the short term
is key for companies”, the spokesperson added,
welcoming the European Commission’s recent
adoption of the Clean Industrial Deal State Aid
Framework, which provides the possibility to
“reduce electricity prices for energy-intensive
industries”.
Since ArcelorMittal’s announcement, EWE, LEAG
and E.ON have all confirmed to ICIS the
postponement or cancellation of German projects
totalling 80MW capacity of hydrogen production.
However, the BMWE remains committed to the
“swift implementation” of national and European
regulations to enable the growth of the
hydrogen industry.
The spokesperson stated that “the development
of a hydrogen economy is to be accelerated and
organised more pragmatically”, using “all
colours” of hydrogen, while transitioning to
renewable hydrogen in the long-term.
Hydrogen infrastructure expansion, including
connections to all German and European ports,
remains important.
To improve the competitive conditions of the
economy, the ministry wants to “abolish
unnecessary bureaucracy (e.g. Supply Chain
Act)” and “simplify planning and approval
procedures”.
The Supply Chain Act, which entered into force
in 2023, requires companies to exercise due
diligence to prevent or address human rights
and environmental violations within their
supply chains, but has been criticized for the
administrative and cost burden on companies.
The BMWE has recently made moves to simplify
hydrogen bureaucracy. On 7 July, it published a
draft bill for the hydrogen acceleration act,
which aims to “significantly accelerate the
market ramp-up of hydrogen (…) by
establishing fast, simplified, and coordinated
approval procedures with clear specifications
and deadlines”.
As part of the bill, hydrogen projects will be
deemed to be of “overriding public interest”,
which will give them priority in regulatory and
legal balancing decisions.
The spokesperson told ICIS that the status of
the hydrogen ramp-up will be reviewed as a
basis for further work addressing the country’s
energy supply security.

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Polyester Staple Fibres11-Jul-2025
LONDON (ICIS)–Covestro has downgraded its
outlook for 2025 due to an ongoing weak global
economy with no signs of a short-term recovery,
it said on Friday.
The Germany-headquartered polymers producer cut
its forecast for earnings before interest, tax,
depreciation and amortization (EBITDA), as well
as two other key financial metrics.
Covestro outlined its revisions in a statement
released ahead of its second-quarter earnings,
due to be published on 31 July.
The company’s adjusted forecast is as follows:
EBITDA is expected to be between €700
million and €1.1 billion. The previous forecast
projected EBITDA between €1.0 billion and €1.4
billion.
Free operating cash flow (FOCF) is expected
to be between €-400 million and €+100 million.
The previous forecast projected FOCF between €0
million and €300 million.
Return on capital employed over weighted
average cost of capital (ROCE over WACC) is
expected to be between -9 and -5 percentage
points. The previous forecast projected ROCE
over WACC between -6 and -3 percentage points.
Preliminary EBITDA for the second quarter
amounted to €270 million, within the forecast
range €200 million-€300 million, Covestro said.
The producer’s first quarter EBITDA halved year on year
though was at the upper end of its forecast.
Crude Oil11-Jul-2025
LONDON (ICIS)–UK economic growth fell for the
second consecutive month in May, driven down by
weak production and construction output.
GDP declined by 0.1% in May following a
decrease of 0.3% in April, the Office for
National Statistics (ONS) said on Friday.
A fall in May production output by 0.9% month
on month was mainly driven by a decline in
manufacturing, which fell by 1.0%.
Construction declined by 0.6% in May, the ONS
said, while the services sector grew by 0.1%.
First-quarter growth
strengthened in the UK from the previous
quarter, although this was recorded before the
announcement of
US trade tariffs, which are likely to be
reflected in future economic data.
Ammonia11-Jul-2025
SINGAPORE (ICIS)–Royal Vopak has signed an
agreement with Japanese heavy-industry firm IHI
Corp to establish a joint venture for the
development and operation of an ammonia
terminal in Japan, the Dutch provider of
storage and infrastructure solutions firm said
on Friday.
The terminal is expected to start operations in
the Japanese fiscal year 2030, it said in a
statement.
“The ammonia terminal development aims to
facilitate the receiving and storing of
imported ammonia within Japan and to facilitate
the establishment of a system for stable supply
of such ammonia in Japan,” Vopak said.
Ammonia is expected to contribute to Japan’s
decarbonization goals through its increased use
as fuel and raw material in power generation
and various industrial uses, it said.
The collaboration focuses on developing a
broader ammonia supply chain in Japan, with the
goal of promoting the various uses of ammonia.
IHI and Vopak also aim to establish an
efficient ammonia distribution system by
utilizing an ammonia terminal with a hub
function for marine transportation.
Vopak, which currently operates six ammonia
storage facilities globally, had signed a
memorandum of understanding (MoU) with Japan’s
IHI in November 2023 to jointly investigate
developing and operating efficient, high
value-added ammonia terminals in Japan.
Ethanol10-Jul-2025
HOUSTON (ICIS)–A federal appeals court has
vacated the reciprocal switching rule enacted by the
Surface Transportation Board (STB) last year,
saying the agency exceeded its authority.
Reciprocal switching is when a railroad that
has physical access to a specific shipper
facility switches rail traffic to the facility
for another railroad that does not have
physical access.
The second railroad pays compensation to the
railroad that has physical access, typically in
the form of a per car switching charge.
As a result of the arrangement, the shipper
facility gains access to an additional
railroad.
The STB said its rule was a remedy for poor
service.
After the STB approved the rule, three major
railroads – Union Pacific (UP), CSX and CN –
filed a challenge in the court, saying the rule
was unlawful.
The US Court of Appeals for the Seventh Circuit
said in its decision this week
that the performance standards in the rule were
arbitrary, capricious and unsupported by the
record.
The court granted the petition to vacate the
rule and sent it back to STB for further
action.
The chemical industry has generally been in
favor of reciprocal switching and submitted
statements in favor of the rule.
Jeff Sloan, senior director of regulatory and
scientific affairs at the American Chemistry
Council (ACC), said the ACC was disappointed
with the court’s ruling, but not overwhelmed.
“When the rule was adopted, we felt it was too
limited and would have limited benefits for
chemical shippers,” he said. “But it is still
disappointing that – even if you know this very
limited attempt to increase access to
competitive rail service – has been denied by
the court.”
Sloan said the STB has authority to use
reciprocal switching in two ways – when it is
in the public interest, and when it is
necessary to promote competition.
“We felt the better approach was for the board
to use the tools that Congress gave it to
promote competition more broadly,” Sloan said,
“and I think this decision confirms that.”
The rule was passed under the previous
presidential administration, and Sloan said he
sees nothing that would indicate the current
administration is likely to oppose the rule if
it was based on promoting competition.
“The administration has issued a number of
executive orders on regulations, and they have
asked the agencies to focus on regulations that
are anticompetitive,” Sloan said.
Sloan said it is still too early to predict the
path forward.
“We would strongly urge the board to look at
the options it has to use its statutory
authority to promote competition,” Sloan said.
The chemical industry is one of the largest
users of the freight rail system, and it relies
on efficient, reliable, competitive railroads
to meet its transportation needs.
“When it falls short, it is harmful to US
chemical producers,” Sloan said.
Eric Byer, president and CEO of the Alliance
for Chemical Distribution (ACD), said he
respects the court’s decision while urging the
STB to work toward providing shippers with a
meaningful reciprocal switching remedy.
“The STB’s original goal, to address inadequate
rail service and provide more competitive
access, is both necessary and long overdue,”
Byer said. “In recent years, widespread rail
service challenges have exposed critical
vulnerabilities in the freight system, and the
chemical distribution industry continues to
face the consequences of limited-service
options and poor reliability.”
Railroads are vital to the chemicals industry
as chemical railcar loadings represent about
20% of chemical transportation by tonnage in
the US, with trucks, barges and pipelines
carrying the rest.
Canada-based chemical producers rely on rail to
ship more than 70% of their products, with some
exclusively using rail.
About 80% of Canada’s chemical production goes
into export, with about 80% of those exports
going to the US.
Ethylene10-Jul-2025
SAO PAULO (ICIS)–Brazil’s trade group
representing chemicals producers Abiquim has
expressed concern over US President Donald
Trump’s threat to impose 50%
tariffs on Brazilian exports, calling for
technical dialogue to resolve the dispute.
In a written response to ICIS, Abiquim said the
issue holds major relevance for the chemical
sector, not only due to direct exports to the
US but also because the industry supplies key
inputs to export sectors including food
processing and pulp and paper.
The Brazilian chemical sector runs a
significant trade deficit with the US,
importing approximately $10.4 billion, while
exporting just $2.4 billion in 2024, said
Abiquim.
The resulting trade deficit in favor of the US
stood at $7.9 billion – by volume, the deficit
totaled 6 million tonnes, said Abiquim.
US petrochemicals subsectors such as caustic
soda, polyethylene (PE), or acetic acid, among
many others, export in large numbers
to Brazil and could be greatly affected if
Brazil retaliates to the tariffs in kind.
“The chemical industry advocates treating
international trade relations exclusively on
the basis of mutual economic gain and the free
market, following the rules of the World Trade
Organization (WTO). In a scenario subject to
political interference, we believe that
technical dialogue is the best way to resolve
this issue,” said Abiquim.
“Both sides are at risk of losses, as they are
important markets for each other’s exports.
Therefore, negotiations are necessary to avoid
potential losses for all parties involved.”
Ammonia10-Jul-2025
This summary was created by ICIS hydrogen
editor Jake Stones and ICIS policy and
regulation analyst Aayesha Pathan
UPDATED: This analysis was updated to provide
greater clarity around the total emissions
allowance for low-carbon hydrogen instead of
the emissions reduction required.
LONDON (ICIS)–On 8 July 2025, the European
Commission published its much-awaited delegated
act for low-carbon hydrogen, opening the door
to regulated low-carbon hydrogen production via
natural gas with carbon capture and storage
technology.
ICIS has produced the following summary of the
delegated act and details provided in its annex
as a means of supporting the market.
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