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Speciality Chemicals23-Jan-2025
LONDON (ICIS)–Wacker Chemie has started up two
new specialty silicones plants in Japan and
South Korea to meet growing demand in Asia, it
said on Thursday.
The facilities in Tsukuba, Japan and Jincheon,
South Korea, will meet rising demand from the
automotive and construction industries.
The Germany-based chemicals producer said it
invested an amount in the “double-digit million
euro range” in the expansion. It did not
disclose specific capacity figures.
Wacker said its’ Tsukuba site in Japan would
focus on the automotive sector, particularly
electric vehicles.
At Jincheon in South Korea, it aims to increase
the output of silicone sealants for the
construction industry.
As well as automotive and construction,
specialty silicones are used in the chemicals,
cosmetics, medical technology, energy,
electronics, paper and textiles sectors.
Speciality Chemicals23-Jan-2025
BARCELONA (ICIS)–Detailed modeling by Europe’s
principal chemicals trade association analyzes
different potential routes and technologies as
the industry moves towards its aim of carbon
neutrality by 2050.
Report aims to guide chemicals to 2050 EU
Green Deal goal of climate neutrality
Covers Scope 1, 2, 3 including embedded
carbon and end of life emissions
Modeling covers many types of technologies
Industry will compete with other sectors
for access to scarce resources
Report models the huge level of investment
required
Click
here to download Cefic’s report “The
Carbon Managers: Modelling Possible Pathways
for the EU Chemical Sector’s Transition Towards
Climate Neutrality and Circularity with
iC2050.”
In this Think Tank podcast, Will
Beacham interviews Florie
Gonsolin, director industrial
transformation projects at Cefic, Nigel
Davis and John
Richardson from the ICIS market
development team 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.
Gas23-Jan-2025
Ministry of energy working with ministry of
finance to ease taxation regime
Romania developing renewables, nuclear, gas
and biomethane production by 2030
Priority is to improve interconnections
with Republic of Moldova
LONDON (ICIS)–Romania needs to develop liquid
markets and reduce taxes as it seeks to expand
its varied energy mix by the end of the decade,
the Romanian energy minister Sebastian-Ioan
Burduja told ICIS in an exclusive interview.
The minister said his priority is the
development of competitive markets, with the
ministry expected to submit a final proposal
for liberalization this month.
“It will be a gradual, cautious liberalization
which will ensure end consumers are protected
while also guaranteeing market liquidity and
competition,” he said.
Romania, one of the EU’s growing economies and
its largest gas producer, will
grow even further in importance with its
domestic gas production set to double once the
Neptun Deep offshore gas output reaches markets
in 2027.
The renewable capacity target in Romania is to
add 10GW, build large and small-scale nuclear
generation, alongside the potential to develop
2 billion cubic meters of
biomethane annually.
However, despite its resources and strategic
position, it has not been able to harness its
full potential because of an unpredictable
regulatory environment and a burdensome tax
regime.
Nevertheless, the minister whose mandate has
now been renewed following recent parliamentary
elections, is determined to address all
challenges.
MARKET AND TAX CHALLENGES
The ministry will work closely with the
regulator ANRE and the electricity exchange
OPCOM to remove barriers to free trading, he
said.
Another instrument the ministry is keen to
promote are contracts for difference (CfD) to
offer long-term stability for investors.
The CfD scheme in Romania has mobilized €3bn
for solar and wind projects, with 1.5GW of
capacity successfully tendered in 2024, the
minister said. Another 3.5GW will be tendered
in 2025.
On taxation, the ministry of energy is working
with the ministry of finance to streamline
regulations affecting the energy sector.
He also stressed the importance of removing
legal barriers that have been slowing access to
electricity or gas networks and insisted on the
need to build new capacity required to
encourage the energy transition, as well as
digitalize networks to bring more flexibility
to markets.
The ministry intends to support startups in the
energy sector through dedicated financing
schemes or public-private partnerships similar
to the Unicorn Factory Lisboa, a project
envisioned by Lisbon city council to expand the
entrepreneurial ecosystem from startups to
scaleups.
REGIONAL ROLE
Regionally, Romania intends to advance new
projects or develop existing ones, that would
enhance market integration and security of
supply.
“Our priority is to improve our
interconnections with the Republic of Moldova.
Projects include gas and electricity
interconnections, storing gas in Romania and
the completion of the 400kV
Suceava-Balti overhead power transmission
line,” he said.
Romania’s partnership with Moldova and the
region could be consolidated via the Vertical
Gas Corridor, which could bring natural gas
sourced primarily as regasified LNG in Greece
and shipped in reverse to Bulgaria, and further
north into Romania, Moldova and Ukraine.
One of the biggest challenges in developing
this corridor is the high
transmission costs charged by Romania’s gas
grid operator Transgaz. Companies active
regionally say it costs €15.46/MWh/day to ship
gas along the full route, with the Romanian
transmission tariff alone covering a third of
the full fee.
“We work closely with ANRE and transmission and
distribution system operators to analyze the
actual tariff structure and means to optimize
them,” Burduja told ICIS.
“We’re also focusing on […] upgrading and
digitalizing the infrastructure. These
investments could lead to reducing operating
expenses and implicitly lead to tariff
adjustments,” he said.
Furthermore, the ministry is working on the
establishment of a ‘green corridor’ connecting
Azerbaijan to Hungary via Georgia, a subsea
section of the Black Sea and Romania, he added.
BLACK SEA GAS
The most critical project for Romania and the
region, however, is the increase in domestic
gas production once output at the Neptun Deep
offshore bloc comes onstream in 2027.
The project, jointly developed by the Romanian
incumbent Romgaz and Austrian-Romanian OMV
Petrom, aims to bring up to 10bcm/year to the
market, boosting Romania’s annual production to
20bcm.
There were recent reports that
OMV Petrom had auctioned off small volumes as
part of the company’s strategy.
However, the minister said the bulk of gas
would be for internal use, as the country would
be looking to develop petrochemical
or pharmaceutical production.
Nevertheless, he said surplus volumes could be
considered for exports.
Finally, he noted the importance of taking
advantage of Romania’s significant agricultural
potential and develop a national biomethane
sector.
Companies say the country could produce as much
as 2bcm of biomethane annually.
“The ministry of energy recognizes this
opportunity and has initiated for the first
time ever in Romania the development of a new
financing instrument dedicated to advanced
biofuels, including biomethane through a
modernization fund,” he said, noting that at
least 5% of the final energy consumption in the
transport sector could come from biofuels by
2030.
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Crude Oil23-Jan-2025
SINGAPORE (ICIS)–ExxonMobil has committed to
invest in carbon capture and storage (CCS)
facilities as well as a new petrochemical
complex in Indonesia, the biggest economy in
southeast Asia.
A memorandum of understanding (MoU) was signed
between Indonesia’s Coordinating Ministry for
the Economy and ExxonMobil on the prospective
projects, the ministry said on 22 January.
The MoU aims to explore ExxonMobil’s
“investment potential in the construction of a
world-class petrochemical complex in Indonesia,
with an estimated investment value of $10
billion”, it said.
“ExxonMobil will build a project related to
CCS,” Indonesia’s coordinating minister for
economic affairs Airlangga Hartarto said in a
post on social media platform X on 22 January,
adding that the US oil and gas company will
also build a petrochemical plant.
“This MoU not only strengthens the national
petrochemical sector but also brings Indonesia
closer to its vision as a pioneer of green
technology at the global level,” Hartarto said.
ExxonMobil has yet to reply to ICIS queries on
the projects at the time of writing.
In November 2023, then Indonesian President
Joko Widodo had said that ExxonMobil is
planning to invest up to $15 billion in a
petrochemical project and CCS facilities in
Indonesia.
Indonesia is heavily reliant on imports of
petrochemicals, including polymers, amid
limited domestic production.
Its current sole integrated petrochemical
complex located in Cilegon, Banten province, is
operated by Chandra Asri Petrochemical
ExxonMobil and Indonesia’s state-owned energy
company Pertamina had announced plans last May
to do preliminary works to develop and build a
CCS hub in the Sunda-Asri basins in the Java
Sea, in northern coast of Java Island.
A preliminary study by the two companies
indicates the basin has the potential to store
up to 3 gigatonnes of carbon dioxide (CO2). The
project is estimated to require a $2 billion
investment.
Thumbnail image: A transport ferry
sailing toward the sea port in Merak, on Java
Island, from Sumatra island, in Indonesia, on
17 July 2024. (Adriana
Adie/NurPhoto/Shutterstock)
Speciality Chemicals22-Jan-2025
HOUSTON (ICIS)–Container vessel operations
will begin at Port Houston at 19:00 local time
on Wednesday, while all Port Houston facilities
will begin normal operations on Thursday.
Port Houston closed all facilities on Tuesday,
and they will remain closed through Wednesday
because of a winter
storm that brought snow and icy
conditions to the region.
Container terminal truck gates closed Monday
afternoon and vessel operations were suspended
later that evening.
At the Port of New Orleans in Louisiana, both
Ports America and New Orleans Terminal will
remain closed through Thursday.
Ports America and New Orleans Terminal will run
gate operations on Saturday, 25 January.
Ethylene22-Jan-2025
HOUSTON (ICIS)–Winter storm Enzo, which caused
a hard freeze along the US Gulf Coast, led to
widespread shutdowns among chemical plants and
refineries.
Companies shut down at least five ethylene
glycol (EG) units and at least eight crackers
because of bad weather. Other plants, such as a
propane dehydrogenation (PDH) unit, also shut
down.
Pre-emptive shutdowns and operational
disruptions reported so far include:
BASF idles Geismar,
Louisiana, EO operations following winter
weather
BASF TotalEnergies cracker shuts down due
to weather
Dow’s Plaquemine, Louisiana, glycol ethers
site down following
winter weather
Dow’s Taft, Louisiana, glycol ethers site
down following
winter weather
Dow idles Taft,
Louisiana, EO site following winter weather
Dow’s Taft, Louisiana, ethanolamines site
down following
winter weather
Enterprise’s PDH1 unit in Texas has
unplanned shutdown
Formosa shuts Louisiana
PVC unit ahead of
freeze
GCGV Portland, Texas, EG
site down ahead of
freezing temperatures
Indorama’s Clear Lake, Texas, EG
site down for
winter weather
Indorama Lake Charles
cracker shut due to
weather
Indorama shuts Port
Neches, Texas, cracker ahead of winter storm
Indorama’s Port Neches, Texas,
ethanolamines unit down due to winter
weather
Indorama’s Port Neches, Texas, EG
unit down ahead of
winter weather
Ingleside, Texas, cracker shut before
winter storm
LACC Lotte/Westlake Louisiana cracker and
EG unit down ahead of
winter weather
Lyondell Channelview, Texas,
crackers flaring on
operations issues
Lyondell La Porte, Texas, cracker
shutting due to
weather
Sasol’s Lake Charles, Louisiana, EO unit
down following
freezing temperatures
Shell’s Geismar, Louisiana, EO, EG site
down following
winter weather
SHUTDOWNS AT REFINERIES AND
BIOFUELSMotiva’s refinery in
Port Arthur, Texas, experienced unexpected
interruptions and shutdowns of several critical
pieces of equipment, it said
in a filing with the Texas Commission on
Environmental Quality (TCEQ). The
disruptions caused emissions at a catalytic
reformer, a fluid catalytic cracking (FCC) unit
and a delayed coker unit.
Renewable Biofuels conducted a planned shutdown
at its biodiesel plant in Port Neches, Texas,
for freeze protection,
according to a filing with the TCEQ.
MIDSTREAM DISRUPTIONSIn
some cases, midstream companies reported freeze
offs and hydrates forming.
If these happen on a wide enough scale, they
could interrupt the supply of natural gas.
Chemical plants and refineries burn natural gas
to produce process heat, and power plants use
it to produce electricity.
PORTSPorts in Houston
and New Orleans
were closed through Wednesday because of
cold weather.
Container vessel operations will
begin at Port Houston at 19:00 local time
on Wednesday, while all Port Houston facilities
will begin normal operations on Thursday.
NO WIDESPREAD POWER
OUTAGES
Texas avoided the widespread power outages that
had led to several plant shutdowns during
winter storm Uri in 2021.
FREEZING TEMPERATURES TO END BY
FRIDAYTemperatures rose above
freezing during Wednesday, and daily highs
should continue to rise as the week progresses.
Lows should be just below freezing on Wednesday
and Thursday, according to meteorologists.
(Thumbnail shows snow, which can
precipitate in the type of cold weather that
can disrupt plant operations. Image by Michael
Ainsworth/AP/Shutterstock)
Ammonia22-Jan-2025
SAO PAULO (ICIS)–Brazil’s
fertilizers-intensive agricultural sector is
expected to produce 322.3 million of grains,
pulses, and oilseeds in the 2024-2025 harvest,
up 8.2% year on year, according to the National
Supply Company (Conab).
Soybean production will continue dominating
Brazil’s agro sector as exports are expected to
keep rising, with a sharp recovery in output
after a lower-than-expected harvest in the
previous period.
In 2024-2025, Brazil’s is expected to produce
more than 166 million tonnes of soybean, up by
more than 11% from the prior harvest.
The country’s warm weather and its fertile land
allows for two harvests a year in some grains,
such as corn for which total production is
expected at 119.6 million tonnes in 2024/2025,
up 3.3%.
Rice output is also expected to rise sharply in
the current cycle, up 13.2% to 11.99 million.
The 2023-2024 cycle was greatly disrupted by
weather events such the historic floods in Rio
Grande do Sul state in May 2024 as well as
high temperatures and a
severe drought in other parts of the
country.
In 2024, Brazil’s harvest stood at 292.7
million tonnes, down 7.2% from 2023.
“After a year of crop failure, the current
cycle tends to recover the average productivity
of crops. For this season, an average yield of
3,509 kilograms per hectare (kg/ha) is
expected, compared to 3,201 kg/ha recorded in
2023/2024,” said Conab.
“The planting of the oilseed occurred in a
concentrated manner, mainly from the end of
October. As a result, the harvest should also
occur, for the most part, from the end of
January. The weather conditions, in the period
analyzed, have been favorable for the crop so
far.”
WORLD BREADBASKETAfter
dips in the previous cycle, Brazil’s grain
exports, which have made it a key breadbasket
for the world’s markets, are expected to regain
much of the ground lost.
In 2024-2025, soybean exports are expected at
105.47 million tonnes, up from the prior
cycle’s 98.6 million tonnes. Among others,
China is one of the key consumers of Brazilian
soybean, which the country uses mostly to feed
livestock.
Corn exports are expected to fall as domestic
consumption rises, said Conab, with shipments
overseas expected at 34 million tonnes, down
from 38.5 million tonnes – the result of a
higher, 86.4 million tonnes consumption by
Brazilian consumers, up from 83.57 million
tonnes in the previous cycle.
“An important addition to rice on Brazilians’
plates, total bean production is also expected
to grow by 4.9%, estimated at 3.4 million
tonnes, the second largest harvest in the last
15 years, behind only the 2013/2014 season,”
said Conab.
“The result reflects both the increase in area
and productivity. In the first legume harvest
alone, the harvest is expected to increase by
15.5%, estimated at just over 1 million tonnes.
The harvest of this first cycle of the crop is
underway, with 19.4% completed in the first
week of January.”
Polycarbonate22-Jan-2025
LONDON (ICIS)–The Packaging and Packaging
Waste Regulation (PPWR) has passed into law
following its publication in the Official Journal of
the EU on Wednesday.
The PPWR was certain to pass into law following
the EU Council vote in December, but the date
of publication marks the date the legislation
comes into force. This date is important for
several of the clauses.
For example, the EU Commission will be required
to review the state of technological
development and environmental performance of
bio-based plastic packaging within 3 years of
the commencement of the PPWR.
The PPWR is one of the most significant pieces
of legislation for the packaging and recycling
value chains in decades and will fundamentally
reshape both industries in the coming decades.
The wide-ranging regulation introduces:
• Mandated packaging recyclability
• Minimum recycled content and reuse targets
across packaging, albeit with potential
derogations based on availability of recycled
material
• Mandatory deposit return schemes (DRS) and
separate packaging collection targets
• New reporting and labeling obligations
• Extension of extended producer responsibility
(EPR) schemes
• Restriction on placing on the market of
food-contact packaging containing per- and
polyfluorinated alkyl substances (PFAS) above
certain thresholds
• Restriction on plastic collation films except
for transportation purposes
• Possibility of bio-based plastic contributing
to recycling targets
• Allowance of imports to count toward
recycling targets provided they are of similar
quality as domestic material and have been
separately collected
More details on the scope and impact of the
PPWR can be found here.
ICIS assesses more than 100 grades
throughout the recycled plastic value chain
globally – from waste bales through to pellets.
This includes recycled polyethylene (rPE),
recycled PET (rPET), rPP, mixed plastic waste
and pyrolysis oil. On 1 October, ICIS launched
a recycled polyolefins agglomerate price range
as part of the Mixed Plastic Waste and
Pyrolysis Oil (Europe) pricing service. For
more information on ICIS’s recycled plastic
products, please contact the ICIS recycling
team at recycling@icis.com.
Benzene21-Jan-2025
HOUSTON (ICIS)–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.
While the investigations take place, the US
can use the threat of possible tariffs to
negotiate agreements. If the negotiations fail,
the US would have taken the steps necessary to
respond with tariffs.
Trump did indicate that he is considering
imposing tariffs on Canada and Mexico as early
as 1 February. This could rely on using
existing laws in unprecedented ways.
The US chemical industry is vulnerable to
tariffs because it has deficits in commodities
such as benzene, melamine and methyl ethyl
ketone (MEK). Its large exports of plastics
make it vulnerable to retaliatory tariffs.
TRUMP LAYS FOUNDATION FOR
TARIFFSAmong the investigations
that will be launched by
Trump’s executive order, those into
national security could lead to Section 232
tariffs, which Trump imposed on steel during
his first term.
Discriminatory trade practices would open the
door to Section 201 tariffs, which were imposed
on washing machines and solar panels.
Unfair trade practices could lead to Section
301 tariffs. The US imposed these against
numerous Chinese imports. That unleashed a
trade war, with China imposing retaliatory
tariffs, many of which targeted US exports of
plastics and chemicals.
POSSIBLE NEW
TARIFFSTrump’s first-day order
pointed to other reviews that his
administration could complete faster and lead
to new tariffs imposed under different sections
of the law.
These could fall under the International
Emergency Economic Powers Act of 1977 (IEEPA),
Section 338 and Section 122.
Trump’s first-day order did not mention these
specific laws, but it did mention national
security, discriminatory actions against US
products and balance of payment deficits – all
issues that these laws were designed to
address.
These laws could allow Trump to impose tariffs
on a faster schedule. The IEEPA only requires
consultation with Congress, and Section 1222
can apparently be imposed unilaterally,
according to the American Action Forum (AAF), a
think tank.
THREAT OF CANADIAN, MEXICAN TARIFFS ON
1 FEBRUARYTrump would need such
speed if he were to impose 25% tariffs on
Canada and Mexico goods on 1 February, a
possibility that he mentioned on Monday,
according to CNBC and other
publications.
Drug trafficking and immigration could provide
the national security basis needed under these
laws.
REVISITING THE PHASE 1 AGREEMENT WITH
CHINATrump’s first-day order
called for a review of the Economic and Trade
Agreement to determine if China is living up to
its end of the deal.
The agreement is more commonly known as the
phase one deal, and
the two countries signed it in January
2020.
It included commitments by China to
purchase more goods from the US; to adopt
policies that will protect intellectual
property; and to reduce pressure on companies
to transfer technology.
China has not fulfilled its import
commitments under the agreement, and
Trump’s order said the country could impose
additional tariffs in response.
US CHEMS VULNERABLE TO
TARIFFSUnless Trump carves out
exceptions, his proposed tariffs on China and
Mexico could raise costs for US chemical
producers.
Canada provides US refiners with heavier grades
of oil that are not produced in sufficient
quantities domestically for the nation’s
refineries. Canadian oil complements the light
grades of oil that the US produces in abundance
from its shale fields.
Regional US markets may rely on Canadian
imports because they are closer than the more
distant sources along the US Gulf. Those
customers will have to reroute their supply
chains if they want to avoid tariffs.
For the broader tariffs that Trump proposed in
his campaign, they could prompt countries to
impose retaliatory duties on US shipments of
plastics and chemicals.
The US is vulnerable to such tariffs because it
has large surpluses of many plastics and
chemicals, such as vinyl acetate monomer (VAM),
methanol, ethylene glycols (EG), polyethylene
(PE) and polyvinyl chloride (PVC).
Tariffs on Chinese imports of rare earth
materials would increase production costs for
catalysts.
Tariffs on fluorspar and hydrofluoric acid (HF)
could increase costs for US producers of
fluorochemicals and fluoropolymers.
Insight article by Al
Greenwood
(Thumbnail shows cranes and containers, which
make up important infrastructure used in
international trade. Image by
Costfoto/NurPhoto/Shutterstock)
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