President Yoon Suk Yeol faces backlash over martial law Yoon a strong advocate for nuclear power at home, abroad Legislators are calling for resignation, impeachment SINGAPORE (ICIS)– South Korea President Yoon Suk Yeol’s short-lived martial law declaration on the midnight of 4 December shocked the country, raising concerns on whether he can finish the term set to end in 2027 without being impeached, and putting uncertainty on Korea’s energy policies, should the office change hands, including strong support for LNG as a transition fuel and phasing out coal. The opposition Korea Democratic Party already filed motions to impeach Yoon on the afternoon of 4 December. If the impeachment passes via the National Assembly, it would need to go through a judicial review and then a new election would be called in 60 days if upheld. Yoon and his People Power Party are a minority in the legislature and have faced opposition roadblocks to ambitious energy policies that were a sharp change from predecessor Moon Jae In. NUCLEAR Yoon, who was elected in 2022, is a supporter of a growing nuclear power footprint at home and exports of nuclear plants, including recent efforts with the Czech republic, and vowed to increase the share of nuclear in the energy mix to above 30% by 2030. Moon had declared that nuclear would be completely phased out since his term in 2017. On 12 September 2024, Korea’s Nuclear Safety and Security Commission (NSSC) granted the construction permit for Shin-Hanul 3 and 4 reactors. This means four nuclear plants are underway by 2038. Korea would further export 10 nuclear plants by 2030 under his envision, to potential buyers all over the world. “The Democratic Party is not pro-nuclear, if they are elected after Yoon’s impeachment they might not start new projects but also not likely to kill the ongoing projects and export efforts due to NDC (National Determined Contribution) concerns”, a Korean academic familiar with the matter told ICIS. “Nuclear is quite essential to achieve Korea’s carbon neutral goals”, he added. The country has a 2050 net-zero carbon target. LNG DEMAND South Korea relies heavily on fossil fuels for power generation. Imported LNG powers over a quarter of the Korean economy. This number is projected to decrease due to rising share of nuclear and renewables. South Korea’s Ministry of Trade, Industry and Energy MOTIE on 19 November said it has formed a “Coal-Fired Power Generation Transition Council” among five companies for an updated roadmap on phasing out coal plants due by the first quarter of 2025. But the country’s LNG import grew by 7.5% from 39.34mtpa in 2023 (January-November), to 42.31mtpa in the same period of 2024, ICIS data shows. “Short-term LNG demand will indeed be lower because of new coal power plants and renewables, but LNG need won’t be diminishing in the next ten years, because electricity consumption will grow due to data centers, semi-conductor industry and more abnormal temperatures,” the Korean scholar said. South Korea is the world’s third largest LNG importer and has extensive power infrastructure to feed high-end manufacturing. As well, South Korean shipyards have completed 500 LNG tankers for export since 1994, according to the Ministry of Trade, Industry, and Energy (MOTIE) in April 2024. Also in November, MOTIE announced pilot bidding for an LNG capacity market. The newly introduced liquefied natural gas (LNG) capacity market is a competitive bidding process for new and new collective energy sources using LNG as the main fuel. The country has also worked closely with Qatar on LNG supply agreements and on shipping – as well as on US projects via private companies. EAST SEA DRILLING In June, the president announced exploratory drilling for fossil fuels off its eastern shore, which could supply the country with oil and gas from four to 29 years, according to estimates. The first drilling will begin in the later half of this month, and the initial results will be released in H1 2025, according to Korean media. It remains unclear what results the exploitation will deliver by then, and whether a change of power will put an end to the project. At the same time, Yoon’s latest poll rating slid to 25%, Korean media reported. The Korean won weakened to just above 1,400 to the US dollar on 4 December from levels just above 1,300 won at the end of October, making imports more expensive at least in the short term, as the country’s main labor union called for a general strike and Yoon’s resignation. The Bank of Korea and South Korea’s Finance Ministry pledged steps for stability, including 10 trillion won ($7.07 billion) in stock market stabilisation funds if needed via the financial regulator. (Roman Kazmin contributed to this article)

HOUSTON (ICIS)–US Cargill announced that as part of a strategic effort introduced earlier this year designed to strengthen the almost 160-year-old company that the agribusiness major will be reducing their global workforce by approximately 5%. The process and timeline for this to be implemented was not revealed but the company said it will be different under the circumstance as it must comply with employment laws and practices in each geography. Yet with an estimated nearly 8,000 jobs set to be eliminated, Cargill acknowledges it was not an easy choice to make this move, and said this new long-term strategy not only continues their legacy but carries forward values and core strengths that have defined their success. “As we look to the future, we have laid out a clear plan to evolve and strengthen our portfolio to take advantage of compelling trends in front of us, maximize our competitiveness, and, above all, continue to deliver for our customers,” said a Cargill in a statement. The company said as the world is changing it remains committed to transforming even faster to deliver for customers and fulfil the purpose of nourishing the world. “To strengthen Cargill’s impact, we must realign our talent and resources to align with our strategy. Unfortunately, that means reducing our global workforce by approximately 5%. This difficult decision was not made lightly. We will lean on our core value of putting people first as we support our colleagues during this transition,” Cargill said. Operating in 70 countries with approximately 1,000 locations worldwide Cargill handles not only food products and ingredients from the start of the supply chain with farmers all the way to the final consumer. They also undertake agricultural solutions including fertilizers and industrial products.

HOUSTON (ICIS)–Australian fertilizer firm Minbos Resources, who is advancing the Cabinda Phosphate project in Angola, announced it has received the first funding from the Angolan Sovereign Wealth Fund for $6.4 million and expects to finalize the construction contract this month. The company said mobilization to the phosphate fertilizer plant, located at Subantando, a new industrial area between the mine site and Cabinda city, is also planned to commence this month with phase 1 to include earthworks, access roads, drainage and concrete foundations. Another $2.43 million will be released upon mobilization of the civil contractor and upon aligning the governance arrangements of the Angolan subsidiaries, with a third disbursement of $1.17 million upon finalizing project insurances and presentation of supplier quotations for project long lead items. Minbos Resources managing director Lindsay Reed said the receipt of this funding and the commencement of construction marks the end of one journey for the company and the beginning of another with the focus now switching to construction activities, sales and marketing and advance their future as a producer of phosphate fertilizer. The Cabinda project, located in northeast Angola, is being developed based on an initial name plate capacity of 150,000 tonnes/year of enhanced phosphate rock with initial production calculated at 50,000 tonnes/year. Previously Minbos said expansion will come in two stages with it planning to add a second and third granulation circuit to reach a name plate capacity of 450,000 tonnes/year after eight years of operations.

TORONTO (ICIS)–Canada’s investment tax credits and its price on carbon emissions have been key in attracting investments in low-carbon projects, led by Dow’s Path2Zero petrochemicals complex under construction in Alberta province. But will these incentives survive a likely change in government next year, with the Conservatives expected to oust Prime Minister Justin Trudeau’s Liberals? Conservatives to scrap carbon tax Industrial carbon pricing critical for low-emission investments Carbon capture advantage might be lost The Chemistry Industry Association of Canada (CIAC) highlighted the election and uncertainties surrounding incentives and programs for low-carbon investments as a risk factor for the industry in its 2025 outlook webinar last week. As the country is moving into the election campaign season, “it is hard to say exactly where we are going politically,” said David Cherniak, CIAC policy manager, Business and Transportation. Companies were making investment decisions based on the incentive programs, and “we see the programs working, companies are getting ready to spend, and in the case of Dow, already spend real money to lower emissions and raise production here in Canada,” he said. In 2023 Dow made a final investment decision on Path2Zero and started construction in April 2024. Carbon pricing is seen as critical for the viability of such projects. CIAC supports industrial pricing and is advocating the importance of the government programs for winning chemistry investments, Cherniak said. The argument for low-carbon chemical production was clear, he said. Around the world the chemical industry’s customers were demanding low-carbon solutions and products, “irrespective of what Canada does,” he continued. As such, the real question is, “Do we want those chemistry products that meet that demand to come from somewhere else or do we want them to come from Canada?” Carbon pricing and programs offering incentives for low-carbon chemical production plants were “key building blocks” to get those facilities built in Canada, he said. If the low-carbon projects are not built in Canada they would be built elsewhere and Canada would end up ending importing their products, he said. “We think it’s way better to utilize Canada’s resources here, and see those investments won, and that is the message we are taking to all parties as we get ready for the election in 2025,” he said. However, “the political winds are blowing,” not just on the federal level but also with a likely election in Canada’s economically most powerful province, Ontario, he said. Canada has seen drastic policy reversals after changes in government before, with impacts on the chemical industry: In 2011 a Conservative government took Canada out of the Kyoto climate change accord, to which an earlier Liberal government had signed up, making Canada the world’s only country to exit Kyoto. On the provincial level, a new Conservative government in 2018 abolished a cap-and-trade carbon trading system a previous Liberal government had set up. AXE THE TAX On the federal level, the opposition Conservatives are far ahead of the Trudeau’s Liberals in opinion polls on the election, which must be held by 20 October 2025 but will likely be called earlier. Under a relentless “Axe the Tax” campaign, the Conservatives have committed to abolishing the Liberals’ consumer carbon tax, which took effect in 2019 and is currently at Canadian dollar (C$) 80/tonne (US$57/tonne), rising to C$170/tonne by 2030. However, the Conservatives have yet to state what they will do about industrial carbon pricing. Industrial carbon pricing is implemented by Canada’s provinces, with the federal government providing a “back-stop” with its “Output-Based Pricing System (OBPS)” that sets minimum requirements to ensure that heavy emitters pay for emissions. Industrial carbon pricing is making a bigger contribution to Canada’s emissions reductions than the consumer carbon tax, according to a study earlier this year. ANALYSTS Analysts at Capital Economics said in a recent report that with a likely change in government there is a high chance that Canada’s carbon tax will soon be scrapped. Positive impacts on inflation from the abolition of the tax would be temporary and any boost to the economy would be small, they said. However, “removing the carbon tax will remove an important investment incentive, both in reducing emissions in Canada’s high-emitting sectors and in emerging ‘green’ sectors,” the analysts said. If the future carbon price in Canada is expected to be zero, rather than rising to C$170/tonne by 2030, “that could weigh heavily on investment in Canada’s emergent ‘green’ industries that rely on a price on carbon to justify their development,” they said. They noted as a key example carbon capture, utilization and storage (CCUS), where Canada has an advantage over other nations, although CCUS is not without critics. Oil-rich Alberta province, which is home to a large proportion of Canada’s petrochemicals production, sees itself among the leaders in developing CCUS technology. Dow’s project leverages on Alberta’s carbon capture infrastructure. In June, Shell made a final investment decision (FID) to proceed with a carbon capture project at its refining and chemicals site in the province, where in 2015 it started up a first carbon capture facility. The Conservative Party of Canada and Dow did not respond to requests for additional comment. (US$1=C$1.40) Focus article by Stefan Baumgarten, with additional reporting by Jonathan Lopez Thumbnail photo of Dow’s manufacturing site in Fort Saskatchewan; photo source: Dow

BARCELONA (ICIS)–Plastics and chemical producers need to find more effective ways to tackle the problem of plastic waste after UN treaty negotiations ended without agreement at the weekend. Consumer demand will drive improvements in plastic waste management Chemical companies need to reconnect with brands/consumers We will move out of current ‘trough of despair’ about recycling End of globalization may mean national/regional treaties are more effective UN Intergovernmental Negotiating Committee concluded in Busan, South Korea, on 1 December, with no definitive agreement Around 100 countries backed proposals, with a small number of hold-outs In this Think Tank podcast, Will Beacham interviews ICIS market engagement executive Nigel Davis and Paul Hodges, chairman of New Normal Consulting. Editor’s note: This podcast is an opinion piece. The views expressed are those of the presenter and interviewees, and do not necessarily represent those of ICIS. ICIS is organising regular updates to help the industry understand current market trends. Register here . Read the latest issue of ICIS Chemical Business. Read Paul Hodges and John Richardson’s ICIS blogs.

MUSCAT (ICIS)–Dow has attributed problems with plastics pollution to a lack of plastics recycling and not production, the US producer’s chair and CEO said at the 18th Annual Gulf Petrochemicals and Chemicals Association (GPCA) on Tuesday. Plastics are “essential” to the modern world, according to Jim Fitterling, and demand will only rise in the years ahead – but most countries have no roadmap to recycle plastics, let alone reduce production. Tensions between oil-producing nations, led by Saudi Arabia, and other nations advocating for a cut in plastics production, have stalled global treaty talks at the Intergovernmental Negotiating Committee (INC-5) in South Korea. The session concluded on 1 December with no definitive agreement. “When policymakers take it upon themselves to decide one type of energy is right and another type of energy is wrong, rather than asking what is right for each unique situation, that’s when progress stops.” Dow is embracing innovation in its energy transition goals, with Fitterling asserting that its energy transition is “here to stay”. Through the company’s plan to “decarbonize and grow”, Dow aims to boost underlying earnings by over $3 billion while reducing greenhouse gas emissions by 5 million tonnes by 2030. Dow is working to transform plastics waste and other alternative feedstocks to commercialize 3 million metric tons of circular and renewable solutions annually,  and generate an anticipated $500 million of incremental run rate EBITDA by 2030, said Fitterling. However, Fitterling added that there is a need to “combat” the notion that recycling does not work, that “success will come from elimination rather than innovation”, as he asserted that recycling simply “isn’t available” to over three billion people globally. “Because for a vast majority of the world, it’s not that recycling hasn’t worked. It’s that recycling isn’t available.” Globally, less than 10% of plastic is recycled and approximately one-third of plastic packaging escapes collection systems, said Fitterling. The 18th edition of the GPCA is being held for the first time in Muscat, Oman this year and will conclude on 5 December. Thumbnail photo: Waste plastic bottles (Source: Shutterstock)

SINGAPORE (ICIS)–Indonesia and Canada have signed a Comprehensive Economic Partnership Agreement (CEPA) in Jakarta after negotiations that lasted 2.5 years. The free trade pact was signed on 2 December in Jakarta is expected to take effect in 2026, according to Indonesia’s Ministry of Trade. “Through this Indonesia-Canada CEPA, market access for Indonesian products will be wider to the North American region, especially Canada,” Indonesian trade minister Budi Santoso said. In addition to trade in goods, the agreement will also provide preferential treatment for Indonesian service providers, including the business services, telecommunications, construction, tourism, and transportation sectors, he added. Indonesia, which is southeast Asia’s biggest economy, is Canada’s 22nd largest merchandise trading partner with two-way merchandise trade totalling $5.1 billion in 2023, data from the Canadian government showed. The southeast Asian country is Canada’s largest export market in the region, and a key destination for Canadian agricultural products, manufactured goods, and natural resources, it added. In January–September 2024, the total value of Indonesia-Canada trade was $2.6 billion, up by 4% year on year, according to Indonesia’s trade ministry.

MUSCAT (ICIS)–In this special edition of the ICIS podcast, Asia deputy news editor Nurluqman Suratman speaks with ICIS market development executive John Richardson on the sidelines of the 18th Annual Gulf Petrochemicals and Chemicals (GPCA) Forum on current issues facing the industry. Ongoing issues over a UN plastics treaty highlight divide between major producers and smaller players Upcoming US tariffs to change trade flows, dynamics for Middle East Global oversupply remains in focus as China demand growth slows Thumbnail image: At the 18th Annual GPCA Forum in Muscat, Oman – 3 December 2024 (By Nurluqman Suratman)

SINGAPORE (ICIS)–US carmaker General Motors (GM) and South Korea’s LG Energy Solution will join hands to develop prismatic battery cells for electric vehicles (EVs). “GM expects the prismatic cell technology developed under the agreement to power future GM electric vehicles, as part of the company’s strategy to diversify its supply chain, leveraging multiple chemistries and form factors,” GM said in a statement on 2 December. Prismatic cells feature a flat, rectangular shape with a rigid enclosure, which allows for space-efficient packaging within battery modules and packs. This can reduce EV weight and cost, while simplifying manufacturing by reducing the number of modules and mechanical components, GM said. The two companies are extending their 14-year battery technology partnership to include prismatic cell development. “LG Energy Solution has both experience with prismatic cell production and an extensive patent portfolio on battery design and manufacturing technologies, including packaging,” GM said. LG Energy solution executive vice president and head of advanced automotive battery division Wonjoon Suh said: “We look forward to deepening our collaboration to drive the right chemistry and battery combinations for continued growth in the EV market.” The automotive industry is a major global consumer of petrochemicals, which account for more than a third of the raw material costs of an average vehicle. EVs and associated battery markets, on the other hand, provide growth opportunity for the chemical industry. Chemical producers have been separately developing battery materials, as well as specialty polymers and adhesives, for the environment-friendly vehicles. “Together with LG Energy Solution, we’ve built Ultium Cells into one of the largest battery cell manufacturers in North America,” GM vice president of battery cell and pack Kurt Kelty said. Ultium Cells – which are currently being produced in Ohio and Tennessee in the US - power GM’s latest EVs including the Chevrolet Silverado EV, GMC Sierra EV, Cadillac LYRIQ, Chevrolet Blazer EV and Chevrolet Equinox EV, as well as the GMC HUMMER EV Pickup and sports utility vehicle (SUV). “We’re focused on optimizing our battery technology by developing the right battery chemistries and form factors to improve EV performance, enhance safety, and reduce costs,” Kelty said. In a separate statement on 2 December, GM said it has reached a non-binding agreement to sell its stake in the nearly completed Ultium Cells LLC battery cell plant in Lansing, Michigan to its joint venture partner LG Energy Solution. Financial details were not disclosed, but the transaction is expected to close in the first quarter of 2025. (Adds details throughout) Additional reporting by Pearl Bantillo Thumbnail image: Hummer electric vehicles at a General Motors factory in Detroit, Michigan, US – 17 November 2021 (By Dominick Sokotoff/Shutterstock)