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PODCAST: Europe oxo-alcohols, derivatives markets mostly sluggish into 2025
LONDON (ICIS)–European oxo-alcohols and derivatives markets have been slow to start up in the new year as familiar factors suppress consumption. Players were hoping for reasonable restocking activity this month, following the destocking period that took place in late Q4 2024, but spot activity has been below expectations for many players down the value chain. Oxo-alcohols and butyl acetate reporter Marion Boakye speaks to acrylate esters reporter Mathew Jolin-Beech and glycol ethers reporter Cameron Birch about conditions down the oxo-alcohols value chain.  
Americas top stories: weekly summary
HOUSTON (ICIS)–Here are the top stories from ICIS News from the week ended 24 January. Hard freeze to hit chem plants on US Gulf Coast, threatens operations Temperatures along the US Gulf Coast should fall well below freezing later in the week and remain there for a prolonged stretch, threatening operations at chemical plants and refineries. US President Trump proposes no tariffs on first day in office US President Donald Trump proposed no new tariffs on his first day of office, and instead instructed his administration to investigate the nation’s trade deficit and other areas of trade policy. INSIGHT: US tariffs slower to materialize as Trump assumes the US Presidency A US Presidential inauguration day packed with fresh legislation saw few of the expected moves on tariffs and trade policy. UPDATE: US Gulf Coast chemical plants reel from cold snap Cold weather in the US Gulf Coast on Tuesday is expected to disrupt petrochemicals operations in Texas and Louisiana as companies take preventive measures. INSIGHT: Trump’s first-day orders lay groundwork for future tariffs US President Donald Trump did not propose any new tariffs on his first day in office, but he did issue an executive order that calls for his administration to conduct the investigations needed to impose them under several sections of the law – in many cases, repeating the same playbook Trump used during his first term in office. UPDATE: US freeze shuts numerous chem plants, major ports Winter storm Enzo, which caused a hard freeze along the US Gulf Coast, led to widespread shutdowns among chemical plants and refineries. INSIGHT: Trump’s moratorium on federal wind projects may have little effect on epoxy The moratorium on federal permits for wind projects will likely have little effect on the US industry and on the epoxy resins it consumes because most turbines are built on private land. US ExxonMobil may build cracker, PE plant in Texas ExxonMobil may build an ethane cracker and polyethylene (PE) plant near Corpus Christi, Texas, the company said in an application for a tax break.
Europe top stories: weekly summary
LONDON (ICIS)–Here are some of the top stories from ICIS Europe for the week ended 24 January. Eurozone private sector returns to growth in January as inflation heats up Private sector activity in the eurozone returned to a growth footing for the first time in nearly half a year in January, with an expanding service sector counterbalancing stronger but still contractionary manufacturing. Europe phenol market squeezed by low demand, high energy costs in Q1 The European phenol market has had a tough start to 2025, with the outlook for demand weak for the first half of the year and the specter of growing energy costs challenging margins. Eastern Europe colourless PET bottle bale prices rise as availability tightens Colder weather means less polyethylene terephthalate (PET) beverage bottle consumption, and as winter grips Europe, many PET recyclers expect feedstock bale availability to tighten during Q1. US tariffs slower to materialize as Trump assumes the US Presidency US Presidential inauguration day packed with fresh legislation saw few of the expected moves on tariffs and trade policy. Europe PE/PP 2025 contract talks see buyers and sellers practice caution Polyethylene (PE) and polypropylene (PP) contracts talks for 2025 have seen players in Europe adopt a cautious outlook.

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BLOG: US-to-China HDPE: The “known, unknowns” and the “known, knowns”
SINGAPORE (ICIS)–Click here to see the latest blog post on Asian Chemical Connections by John Richardson. Donald Rumsfeld’s famous comments about “known, unknowns” and “known, knowns” remains useful (let’s leave aside “unknown, unknowns” for the time being). Let’s apply his comments to high-density polyethylene (HDPE) as we try to answer the question of whether the US can retain the strong position it has enjoyed in China over the last three years. See today’s post in full here with the summary as follows: A “known, unknown” is that nobody has a clue about the outcome of US trade policies towards. So, prepare for anything from improved China/US trading relationships to a full-blown trade war and anything in between these two extremes. A “known, known” is that the US has over the last three years emerged as a winner in HDPE exports to China during what is at least a medium- term (this a second “known, known”, I believe) Chinese economic slowdown and the country’s rising HDPE self-sufficiency. This has been at the expense of Saudi Arabia, Iran and South Korea etc., as we can see from today’s main chart. Saudi Arabia’s sales turnover in China was down by an estimated $2.3bn in 2022-2024 versus 2019-2021. Iran was 1.8bn lower and South Korea 0.52bn lower. In contrast, the US was nearly a billion dollars in the black. We thus need a range of scenarios on our first “known, unknown” about how different US trade policy outcomes could reshape global HDPE trade flows and sales turnover in China, But another “known, unknown” is the extent to which lower Chinese import tariffs on US HDPE from February 2020 onwards has led to the US being a winner versus its feedstock advantages. Since the Evergrande Turning Point, its feedstock advantages over the Middle East as a whole have been slight (although Saudi ethane costs have gone up substantially in recent years and are reported to have gone up again this month), but huge over Northeast Asia and Southeast Asia. Further, we don’t know the degree to which the mix of grades exported to China has also played a role. China is increasingly able to meet its commodity-grade needs but still requires substantial imports of higher-value grades as its economy matures. And what about production issues, i.e. outages and turnarounds? This leads us to our final “known, known”: That scenario modelling has become much more complex. Different assumptions on all the above variants – and probably more that I haven’t even thought of – need to be factored in as we assess future HDPE trade flows to China and earnings in China by the big exporters. This is where artificial intelligence can increasingly help us. Why make life hard for yourself by not making maximum use of AI? Don’t be a Luddite because the answers are not perfect now. AI will get better the more we work with it. 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.
China industries contract in January; official PMI falls to 49.1
SINGAPORE (ICIS)–China’s official manufacturing purchasing managers’ index (PMI) slipped back into contraction mode, with a January reading of 49.1, as factory activity wound down ahead of the eight-day Lunar New Year holiday, official data showed on Monday. Jan new export orders subindex falls to 46.4 from 48.3 in Dec Industrial profits fall for third straight year in 2024 Beijing likely to maintain “around 5%” growth target for 2025 The January PMI print ended a three-month expansion streak. A PMI reading above 50 indicates expansion in the manufacturing sector, while a reading below 50 signals contraction. The eight-day Lunar New Year holiday which begins on 28 January, with its attendant mass migration of workers back to their hometowns weighed heavily on the country’s manufacturing sector in January, according to Zhao Qinghe, a senior statistician at China’s National Bureau of Statistics (NBS). The new orders subindex stood at 49.2 in January, down from 51.0 in the December 2024; while the subindex for new export orders fell to 46.4, compared with 48.3 in the previous month, the data showed. China’s key exports sector remains under scrutiny, particularly after the country’s exports surged by 10.7% year on year in December, driven by concerns over potential tariffs by major trade partner – the US. Manufacturers had front-loaded orders in anticipation of these tariffs, leading to the significant increase in exports. Trump on 21 January said he is considering 10% tariffs on imports from China that would take effect as early as 1 February, citing the east Asian country’s purported role in the trade of addictive synthetic opioid fentanyl. Fentanyl is responsible for tens of thousands of overdose deaths annually in the US, according to the US Drug Enforcement Administration. Trump’s comments came a day after he ordered an investigation into Chinese trade practices but held off on announcing any new tariffs. “A lot of what Trump pledged to do was carried out on Day 1 with the absence of concrete tariff measures a significant relief, but a delay does not imply no tariffs. There is after all another 4 years of Trump to go,” Singapore-based UOB Global Economics & Markets Research said in a note. UOB expects a staggered implementation of the tariffs, starting as early as Q2 2025 and concluding by the first half of 2026. China’s economy posted a 5% growth last year, reaching the government’s target, following extensive government stimulus measures. The economy, however, continues to face challenges, including a sluggish property market, weakening domestic demand, and fragile business confidence. This imbalance is evident in December’s economic data, which showed industrial output outpacing retail sales, while the unemployment rate edged higher. Meanwhile, separate data from the NBS on Monday showed that profits at China’s industrial firms fell for a third straight year in 2024, contracting by 3.3% after the 2.3% decrease in 2023. The 2024 profits at state-owned companies fell by 4.6% year on year, while those of foreign firms fell by 1.7% and private-sector companies recorded a 0.5% rise in earnings, the data showed. In December alone, China’s industrial profits grew by 11% year on year, reversing the 7.3% decline in November. The industrial profit figures cover companies with annual revenues of yuan (CNY) 20 million or more from their core business operations. Beijing is likely to maintain its “around 5%” growth target for 2025, following a rebound in Q4 growth and achieving its 2024 target, Japan-based Nomura Global Markets Research said in a note. “However, we do not believe it is time for Beijing to be complacent… in addition to stepping up monetary easing and fiscal stimulus, Beijing needs to clear the property market, fix the fiscal system, reform the social welfare system, and alleviate geopolitical tensions to deliver a truly sustainable growth recovery.” ($1 = CNY7.26) Focus article by Nurluqman Suratman
Asia petrochemical trades wane; Trump’s tariff threat weighs on Feb outlook
SINGAPORE (ICIS)–Trades in Asia’s petrochemical markets have slowed down ahead of the Lunar New Year holiday, with a general oversupply in the region and the threat of US tariffs clouding the outlook in February. Some downstream plants start shutting down two weeks before the holiday Buyers mostly stay on sidelines while some suppliers raise prices Players cautiously optimistic over post-holiday demand Demand across oleochemicals, polyethylene (PE) film, acrylonitrile butadiene styrene (ABS), styrene acrylonitrile (SAN) has softened as factories wind down or shut operations ahead of the Lunar New Year holidays. The Lunar New Year, which falls on 29 January, is celebrated in most parts of northeast and southeast Asia, with China on holiday from 28 January to 4 February. Uncertainty over US trade policy under Donald Trump’s administration, which expressed its intention to impose 10% tariffs on China from 1 February, has weighed on market sentiment going into and during the holiday. “China is slowing down ahead the Lunar New Year. Buying interest is low as market players are going away back to their hometowns,” said a source in the PE pipe grade market. A southeast Asia-based glycerine producer said: “We have not been getting any enquiries from China recently for glycerine, so we have been focusing on other regions.” Same conditions were observed in Vietnam, which is on holiday from 27 January to 3 February. Spot transactions were minimal in Asia, with trade discussions mostly deferred until after the holidays. MARKET ACTIVITY TO RESUME H2 FEB In the Asian recycling market, active trades may only resume when major exporters in China and Taiwan are back in the second half of February from a prolonged holiday. China and Taiwan have the largest exporters of recycled polyethylene terephthalate (rPET), recycled polyethylene (rPE) and recycled polypropylene (rPP) pellets. Meanwhile, suppliers of PE pipe grade, titanium dioxide (TiO2), and caprolactam (capro), have either reduced spot supply or hiked prices before the holiday even though demand remains weak. In the TiO2 market, players deemed the price hike on 21 January was more in anticipation of some improvement in post-holiday demand. “I don’t expect many trades to happen before LNY [Lunar New Year]. Most buyers said they are covered,” one market player said. TRUMP WORRIES CONTINUE For capro, styrene monomer (SM) and monoethylene glycol (MEG), demand is expected to improve post-holiday on seasonal restocking or improved opportunities for Chinese exporters. However, uncertainties over US President Donald Trump’s trade policies, including potential 10% tariffs on Chinese products from 1 February, and oversupply in key markets are tempering optimism in the near term. In December 2024, ABS and SAN end-users ramped up production to frontload shipments of contractual volumes to the US ahead of Trump’s widely anticipated tariffs of as much as 60% on Chinese goods. This led to a marked increase in China’s styrenics exports for the month. Starting January, these end-use factories reduced their run rates, having met their contractual obligations, with some having shut their plants as early as last week. The pre-Lunar New Year period typically sets the stage for post-holiday recovery, when inventories are cleared and demand resumes. Market players were keeping a cautiously optimistic outlook on demand recovery. “Ethyl acetate (etac) inventories will rise [post-Lunar New Year holiday] with production, but [Chinese domestic] demand will remain weak in February,” said a China-based market source. All eyes are focused on how soon Trump will impose his promised tariffs, with actual market impact likely to be felt a month after the announcement, according to market players. Focus article by Jonathan Yee Additional reporting from Yvonne Shi, Izham Ahmad, Arianne Perez, Helen Yan, Angeline Soh, Seng Li Peng, Isaac Tan, Joson Ng, Tan Hwee Hwee, Luffy Wu, Yvonne Shi, Melanie Wee, Judith Wang Thumbnail image: At Qingdao Port in Shandong province, China, on 23 January 2025. (Costfoto/NurPhoto/Shutterstock)
Asia top stories – weekly summary
SINGAPORE (ICIS)–Here are the top stories from ICIS News Asia and the Middle East for the week ended 24 January. INSIGHT: Asia braces for Trump’s trade upheaval By Nurluqman Suratman 20-Jan-25 12:00 SINGAPORE (ICIS)–Asian policymakers are bracing for the return of Donald Trump, dubbed “Trump 2.0,” with heightened concerns over increased trade tariffs, ahead of his inauguration as US president on 20 January. Oil prices mixed as Israel-Hamas ceasefire begins; supply concerns persist By Jonathan Yee 20-Jan-25 13:49 SINGAPORE (ICIS)–Oil prices were mixed on Monday afternoon amid easing tensions in the Middle East as the Israel-Hamas ceasefire took effect on 19 January, although supply concerns remain amid US sanctions on Russia’s energy sector. Asia PV-grade EVA market firms on supply curbs in China, outlook mixed By Helen Lee 21-Jan-25 17:21 SINGAPORE (ICIS)–After a slow start to the new year, Asia’s photovoltaic (PV)-grade ethylene vinyl acetate (EVA) prices rose for the first time since early December 2024 on revived demand for January and February shipments into the key China market. INSIGHT: Firming crude, plant outages provides support across Asia petchems in Jan By Jimmy Zhang 21-Jan-25 20:00 SINGAPORE (ICIS)–A substantial proportion of Asia petrochemical prices are expected to increase in January, with rising crude values providing the bulk of upward support early in the month, buoyed further by plant outages in some markets. Asia caustic soda pre-Lunar New Year supply may be crimped By Jonathan Chou 22-Jan-25 12:36 SINGAPORE (ICIS)–Asia’s liquid caustic soda supply conditions may be tighter than expected ahead of the upcoming major regional Lunar New Year holidays amid some regional producers’ turnarounds and the possibility of capped operating rates due to sluggish co-product conditions. Tonnage shortfall pulls back China solvent exports to Taiwan By Hwee Hwee Tan 23-Jan-25 10:52 SINGAPORE (ICIS)–An escalated trade spat has hindered regional tanker supply from adjusting in favor of changing petrochemical trade flows between China and Taiwan. Malaysia keeps key interest rate steady; steady GDP growth to be sustained in 2025 By Nurluqman Suratman 23-Jan-25 15:37 SINGAPORE (ICIS)–Malaysia’s central bank kept its benchmark interest rate unchanged on 22 January, amid expectations that the domestic economy will be able to sustain its growth momentum this year on manageable inflation levels. Gap between Asia rPET and PET prices stay wide despite recent gains By Arianne Perez 24-Jan-25 15:18 SINGAPORE (ICIS)–Asian spot prices of recycled polyethylene terephthalate (rPET) remain substantially higher than virgin plastics despite the recent double-digit increase in spot PET prices.
SHIPPING: Asia-US container rates plunge on Lunar New Year holiday lull
HOUSTON (ICIS)–Rates for shipping containers from east Asia and China to the US plunged this week, as did global average rates amid the typical slowdown around the Lunar New Year (LNY) holiday. Meanwhile, shipowners are out with surcharges on various trade lanes, which could support rates at current levels even with the slowdown in volumes. Global average rates fell by 11% according to supply chain advisors Drewry and as shown in the following chart. Rates from Shanghai to Los Angeles fell by 8%, while rates from Shanghai to New York fell by 7%, as shown in the following chart. Drewry expects spot rates to decrease slightly in the coming week on the back of the Chinese Lunar New Year holidays. Rates from online freight shipping marketplace and platform provider Freightos also showed decreases, with a 10% fall from Asia to the West Coast and a 3% drop to the East Coast. Judah Levine, head of research at Freightos, said the lull around LNY is pressuring rates lower. CMA CGM has announced a congestion surcharge of $300/FEU originating from Callao and San Antonio to the US East Coast and US Gulf. Global shipping major Maersk announced peak season surcharges of $1,000 for all sizes of containers for shipments from Middle East countries to the US and Canada East Coast, effective 1 February. Hapag-Lloyd has announced peak season surcharges of $600/container from Chile to Asia. 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. RETURN TO SUEZ CANAL NOT IMMINENT While the ceasefire agreement between Israel and Hamas led to some optimism that transits through the Suez Canal could resume, passage of commercial vessels through the waterway are not imminent. Levine said there remains skepticism among shipping analysts that the Houthi rebels will refrain from attacks on commercial vessels in the Red Sea even during the first stage of the ceasefire. Negotiations on the second phase of the agreement are scheduled to begin on 5 February. Levine said ocean carriers do see the ceasefire as a promising first step, but only CMA CGM has said it will increase its use of the Suez Canal. Most carriers will not take the costly and complicated concrete steps to return to the Red Sea until they are confident that the route is and will remain safe. Many shippers and freight forwarded are also hesitant to change course. Peter Sand, chief analyst at ocean and freight rate analytics firm Xeneta, said carriers will want assurance they have safe passage for crews and ships in the long term and that the situation will not suddenly deteriorate. PANAMA CANAL President Donald Trump surprised some when he said that the US should reclaim the Panama Canal. A US congressman has since introduced a bill that would authorize the purchase of the Panama Canal. The US is the largest user of the canal, with around 70% of all traffic heading to or coming from US ports. About 40% of US container traffic use the canal. The US relinquished control of the canal on 31 December 1999 in The Panama Canal Treaty, signed by then US President Jimmy Carter. Panamanian President Jose Raul Molino said the treaty, along with The Treaty Concerning the Permanent Neutrality and Operation of the Panama Canal, established the permanent neutrality of the Canal, guaranteeing its open and safe operation for all nations. The Panama Canal remains the primary route for trade between Asia and the US Gulf and East Coast. LIQUID TANKER RATES US chemical tanker freight rates assessed by ICIS were largely stable week on week, with just the USG to Brazil trade lane seeing a slight increase on smaller volumes but overall unchanged. The market remained quiet this week, with COA volumes steady. For cargoes moving in and out of South America some space remains available, capping the gains seen on the week. Strong interest that was seen over the past two months is waning, which is likely to put additional pressure on freight rates. Volumes from the US continue to flow, but cargo moving into Asia is slowing because of the Lunar New Year holiday. However, monoethylene glycol (MEG) and ethanol entered the market for February loading. A different scenario is playing out on the transatlantic eastbound route where February loading space is already available for spot but on a limited basis. On the other hand, there seems to be a lot of interest on the USG to India trade lanes as there is a lot of lube oils interest for January with limited spot space remaining as owner await COA nominations. Several inquiries were seen for methanol, ethanol and vinyl acetate monomer (VAM). Additional reporting by Kevin Callahan
US ExxonMobil may build cracker, PE plant in Texas
HOUSTON (ICIS)–ExxonMobil may build an ethane cracker and polyethylene (PE) plant near Corpus Christi, Texas, the company said in an application for a tax break. If ExxonMobil proceeds with the project, it would be built in Calhoun county, which is north of Corpus Christi, the application said. Construction could start in 2025 and finish at the end of 2030. Production could start in 2031, the application said. ExxonMobil is considering other locations for the possible project, including the Middle East, Asia and other sites in North America. ExxonMobil did not disclose capacity figures. The total capital investment could be $8.6 billion. In a statement, ExxonMobil said it was evaluating multiple locations around the world for a future chemical plant. It acknowledged the advantages of a project on the Gulf Coast, which it could integrate with its operations in the Permian basin. “While this site has potential, we are very early in our evaluation process,” ExxonMobil said. “Filing for a tax abatement before a final decision is required by law and is part of our due diligence to gain greater clarity for our shareholders and the community. “As we look to meet global demand for our products, we’ll continue to evaluate the market conditions before we make a decision,” the company said. ExxonMobil is involved in another petrochemical project in nearby San Patricio county under the Gulf Coast Growth Ventures joint venture with SABIC. Operations started earlier in the decade, and that project produces ethylene, PE and ethylene glycols. Thumbnail shows PE pellets. Image by ICIS. (adds comments from ExxonMobil, paragraphs 6-8) (adds clarification about operations starting earlier in the decade, paragraph 9)
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