ICIS Supply and Demand Database

SINGAPORE (ICIS)–Malaysian state energy giant PETRONAS is shedding 10% of its workforce by the end of the year to navigate challenging operating conditions, primarily driven by falling crude prices. Some 5,000 staff to be affected by the ongoing "right-sizing" process will be notified by the end of this year, PETRONAS president and CEO Tengku Muhammad Taufik Tengku Aziz was quoted as saying by state media Bernama. The company chief held a press briefing in Kuala Lumpur on 5 June to make the announcement. "PETRONAS 2.0 will be run differently, organized differently, will have different work processes, and to move towards that, we will have to correct the work process," he said. The company did not immediately respond to ICIS’ queries on the job cuts. PETRONAS aims for a lean and nimble operation, even if oil prices were to reach $100 per barrel, Muhammad Taufik said. "There is a logic, an assumption set, and a projection that backs it up. Over time, we have seen this—those who have tracked our history will know that when the fields were easier, our profit before tax margin was around 35 to 40 per cent," he said. "Today, it is [between] 25% and 38%. These margins are going to shrink further … So the value-added (PETRONAS) 2.0 has to transform into an organization that monetizes molecules commercially and competitively, not just at home, but also abroad," he said. In 2024, PETRONAS reported a 32% year-on-year decline in its after-tax profit to Malaysian ringgit (M$) 55.1 billion ($13 billion), as revenue fell by 7% due to lower average realized prices. Its petrochemicals arm – PETRONAS Chemicals Group – had a 30.7% slump in net profit over the same period to M$1.18 billion, despite a 7% increase in sales to M$30.7 billion. PETRONAS' budget is predicated on Brent crude trading between $75/barrel and $80/barrel. Currently, the crude benchmark is hovering near $65/barrel, marking a roughly 13% decrease year on year, influenced by global trade tensions and increased output by OPEC and its allies (OPEC+). ($1 = M$4.23) Thumbnail image: PETRONAS Twin Towers in Kuala Lumpur, Malaysia – 15 March 2025 (Md Rafayat Haque Khan/ZUMA Press Wire/Shutterstock)

06-Jun-2025

HOUSTON (ICIS)–Rates for shipping containers from Asia to the US spiked again this week – and have almost doubled over the past four weeks – as demand has surged ahead of the possible reinstatement of tariffs while capacity remains tight. Supply chain advisors Drewry said the latest sudden, short-term strengthening in supply-demand balance in global container shipping has reversed the trend of declining rates which had started in January. Rates from Shanghai to Los Angeles spiked by 57% this week while rates from Shanghai to New York jumped by 39%, according to Drewry and as shown in the following chart. The drastic increases are seen from other shipping analysts as well. On the Shanghai Containerized Freight Index (SCFI), the Shanghai-USWC rate rose by 58% to $5,172/FEU (40-foot equivalent unit), the largest week-on-week percentage gain since 2016 as strong demand has coincided with tight supply, though capacity is increasing as carriers resume previously suspended services and reinstate blank sailings. Sea-Intelligence CEO Alan Murphy said almost 400,000 TEUs (20-foot equivalent units) are coming back online in the near term. “If we aggregate it across June/July for Asia-USWC, then in June, the lines are increasing capacity 12.8% compared to before the tariff pause, and in July, the capacity injection is increasing to 16.5% compared to the pre-pause situation,” Murphy said. “Capacity has also ramped up sharply compared to just a week ago, with this injection of capacity equaling 397,000 TEU across the two months.” The growth in capacity is shown in the following chart from Sea-Intelligence. Peter Sand, chief analyst at ocean and freight rate analytics firm Xeneta, said the spike is likely because shippers are so concerned about getting goods moving during the 90-day window that they are willing to pay more. “Right now, it seems carriers are telling shippers to jump, and some are replying ‘how high?’,” Sand said. “This will not last because capacity is heading back to the transpacific and the desperation of shippers to get supply chains moving again will ease once boxes are on the water and inventories begin to build up,” Sand said. “Spot rates are expected to peak in June before downward pressure returns.” Rates from online freight shipping marketplace and platform provider Freightos have yet to capture the dramatic increase, but Judah Levine, head of research at the company, said 1 June general rate increases (GRIs) are starting to push daily prices up sharply. “Rates have spiked 72% to the West Coast since last week to $4,765/FEU and 44% to the East Coast to $5,721/FEU, with more increases likely and additional hikes announced for mid-month,” Levine said. Analysts at US logistics platform provider Flexport said they expect a further rush of cargo from southeast Asia to the US West Coast toward the end of June. Flexport analysts expect carriers to be back to full capacity on the transpacific eastbound trade lane by the end of June, noting that week 23 capacity is 11% below standard levels but is expected to exceed standard levels by 3% by week 25. 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 US chemical tanker freight rates assessed by ICIS were mostly unchanged. However, rates decreased from the US Gulf to Europe. The USG to Rotterdam route is overall steady as weaker demand is being offset by limited availability, particularly for larger parcels. Larger requirements are well represented, with several larger lots of methanol, methyl tertiary butyl ether (MTBE) and caustic soda fixed or indicated to the ARA. There was also some interest in sending some smaller lots of glycols and styrene. From the USG to Asia, the uptick in interest to rush glycols to beat the deadline to China seems to have all but ended as the market saw only a few new inquiries. On the other hand, several larger parcels of methanol were either fixed or quoted to the region. As contract of affreightment (COA) volumes are being firmed, and due to the absence of market participants, freight rates have eased some, with more downward pressure on smaller parcels. On the USG to Brazil trade lane, the market has been steady, leading rates to remain unchanged week on week. There was a stable level of spot activity with only a handful of new requirements. Overall, the market remains slow despite several cargoes being quoted and fixed. Despite the uptick in inquiries there is not enough significant activity that would suggest any increase in demand, with caustic soda, glycols and styrene the most active. The regular owners have space remaining and are trying to fill space while supporting current freight levels. Activity typically picks up during summer months, but this is not currently being seen. As a result, freight rates are now expected to remain steady for the time being. Focus story by Adam Yanelli Additional reporting by Kevin Callahan Visit the US tariffs, policy – impact on chemicals and energy topic page Visit the Logistics: Impact on chemicals and energy topic page

05-Jun-2025

SAO PAULO (ICIS)–Logistical mayhem at Mexico’s largest port of Manzanillo is hitting imports of chemicals and industrial goods after a strike in May by customs personnel worsened an already poor performance. Players in the distribution sector have said practically all products coming to Manzanillo in Colima state, the port of entry for Asian imports into Mexico with around 40% of the country’s container cargo, are affected as queues are extending to days and affecting the related road and rail transport. The situation has become so dysfunctional that many companies are opting to change their logistical plans and opting to send cargo to the Lazaro Cardenas Port, 350km south in the state of Michoacan. “We're paying a fortune in delays. It is taking days to get a date to make your shipments, and when they give you a date, it keeps moving forward several times, adding to the increasing costs we are facing. We are reducing as much as we can any operation involving Manzanillo,” a chemical's distributor source said. Due to chemicals trade’s safety requirements, the source added the company’s logistical woes had been widened by the implementation of a new Administrative and Customs Matter Proceeding (PAMA in its Spanish acronym) system introduced in 2024, which has increased the checks and costs for many of the shipments. In a written statement to ICIS, a spokesperson for logistical firm Logistica de Mexico (LDM) said the company is turning increasingly pessimistic about the port’s crisis, adding it now expects the crisis could take up three months to normalize. In a letter to customers seen by ICIS, one of the operators at the port of Manzanillo, SSA Marine Mexico, said the crisis “continues without significant improvement” because the resumption of operations after the strike at the end of May had been “partial and with insufficient” staff. The Port of Manzanillo is the largest containerized port in Mexico, with 70% of cargo coming from Asia entering Mexico through it. It handles around 35 million tonnes/year of cargo. STRIKE WORSENS POOR PERFORMANCEUp to May, the Port of Manzanillo already suffered performance problems, attributed by trade unions representing workers at Mexico’s National Customs Agency of Mexico (ANAM) to the lack of staff compounded by poor working conditions for workers. Internal protests escalated during May, with the government increasing presence of military personnel from the Navy (Secretaria de Marina) and deepening the rift. By mid-May, the crisis reached boiling point and protestors “completely blocked” access, the Navy said in a statement on 15 May. An intermittent strike followed, with hours-long stoppages, which practically paralyzed the port up to the week commencing on 23 May. Talks between the government and trade unions continue, with the latest round held on Thursday, but progress has been slow. As well as salary demands, trade unions have said customs workers at the facility have faced workplace harassment, exploitation and unjustified dismissal. The Association of Terminals and Operators of Manzanillo (ASTOM) has been quoted on Mexican news outlets this week saying it expects a resolution the crisis to be found as soon as this week or early next week. ASTOM had not responded to a request for comment at the time of writing. “Right now, Manzanillo is saturated, with congestion at all the port’s terminals. Even if you get customs clearance after making the payment, you will be given an appointment for the actual shipment one week later. It’s become completely dysfunctional,” said the source at the chemicals distributor. “It’s hard to have an estimate for when the delays will be cleared. This is a situation now affecting all importing and exporting companies using this important facility. Because of the location of our facilities, Lazaro Cardenas port does not work so well for us – otherwise we would have already diverted to that port.” UP TO 12 WEEKS RESOLUTION – ALL GOING WELLIn its written statement to ICIS, the spokesperson for LDM confirmed what the company’s CEO, Jose Ambe, said earlier this week in an interview with Mexican news outlet El Mañana in which he gave the most pessimistic assessment of how long the crisis could linger: three months. "Although we see that the authorities are taking some measures to restore operations and partially resume activities, to be honest, the port's full normalization will take between eight and 12 weeks. This is based on the flow we are seeing, the containers that are delayed, and the lack of personnel," Ambe said. "The port has been opened but a bottleneck was created, which meant it couldn't be moved, and there is a lack of personnel to address this. There are still protests from port and customs workers, who continue to protest amid the lack of personnel.” Ambe concluded saying that unjustifiably dismissed personnel will likely have to be reinstated and authorities may need to meaningfully improve the customs employees’ working conditions for the crisis to overcome the impasse. In its letter to customers dated 30 May, SSA Marine Mexico gave a hint of how the crisis deepened in May, a month when 45% of import containers had not been delivered and 32% of export containers had not been shipped, while 40% of scheduled empty containers have not been received and shipped. The letter went on to say that, as a response to the crisis, ANAM had adjusted the issuance of appointments, according to the operational capacity of Manzanillo’s customs office, which caused SSA Marine Mexico's  capacity to fall from 1,800 import appointments/day to 1,100/day. “This backlog has limited operational capacity at both terminals. If the scheduled appointments for 2 June [the letter was dated 30 May] are not met, the terminals will be severely affected, increasing the utilization of our yards, generating delays of more than two days in the berthing of upcoming vessels, and affecting our operations in general,” said the company. SSA Marine Mexico had not responded to a request for comment at the time of writing. The crisis now affects the entire supply chain – from the large terminal operators with more financial muscle to individual truck drivers for whom one day delay upend tight finances. A representative for the Manzanillo Freight Transporters Union (UTCM) said in a TV interview this week that costs for truck drivers are shooting up as the crisis extends. “For a typical carrier, it costs between [Mexican pesos (Ps)] 2,500-2,800/day ($130-146/day) if the truck is waiting, not able to load and has to wait. And, if you manage to get the load, the process of entering the port and then re-route to leave the port can take between eight and 12 hours,” they stated. UTCM was contacted for further comment but had not responded at the time of writing. AND THEN, THERE IS PAMAIn 2024, the Mexican government implemented the PAMA regulations aiming to improve the clearance of goods at customs facilities and the seizing of illegal goods. In practice, the detailed regulation has added costs in the form of bureaucracy and, in the case of chemicals, sharply slowed down the entry of imports into Mexico. PAMA entails companies now must give more information about the load. For example, if the declared weight of the load deviates in the slightest from the weight showed on the customs scale, this can be a reason to send the load back to square one, with a fine potentially also imposed, according to the source in chemicals distribution. “Right now, we have a container which has held for 45 days, and we can't release it. There was a mismatch in the weight: it was missing two decimal places. We paid a fine, and corrected the error, but to no avail: today [4 June] we are still battling to release that container,” said the source. “It is a very serious problem – many of our loads get stuck because of PAMA-related issues, and becomes a burdensome, time-consuming process. Moreover, the fines are disproportionate, ranging from 70% to 100% of the value of the merchandise. And, since May, this problem has been compounded by Manzanillo’s crisis.” Insight by Jonathan Lopez  Thumbnail image: One of Manzanillo Port's terminal. (Image source: Manzanillo's port authority (ASIPONA Manzanillo))

05-Jun-2025

LONDON (ICIS)–LyondellBasell has entered into exclusive talks with an industrial investor for the sale of four European production sites, slightly over a year after launching a review of its asset base in the region. The company entered into the talks with AEQUITA, a Germany-based investment group specialising in turnarounds and carve-outs. Other assets acquired by the firm include a bake disc technology company purchased from Bosch, a cloud solutions business from Fujitsu, and a glass manufacturer from Saint-Gobain. AEQUITA is in position to take control of four sites of the nine operated by LyondellBasell in Europe in the deal, spanning France, Germany, Spain and the UK. Sites to be sold Site Production (tonnes/year) Berre, France Ethylene (465,000 tonnes/year) LDPE (320,000 tonnes/year PP (350,000 tonnes/year Propylene (255,000 tonnes/year) Munchsmunster, Germany Ethylene (300,000 tonnes/year) HDPE (320,000 tonnes/year) Propylene (190,000 tonnes/year) Carrington, UK PP (210,000 tonnes/year) Tarragona, Spain PP (390,000 tonnes/year) That leaves LyondellBasell with its Knapsack and Wesseling, Germany, site – collectively its largest production centre in Europe – as well as Frankfurt, Germany; Moerdijk, Netherlands; Brindisi, Italy and Tarragona, Spain. Collectively, the sites represent a “scaled” olefins and polyolefins platform with operations close to customer demand, LyondellBasell said, although the size of the crackers in the portfolio are smaller than many capacities that have come on-stream in the last few years. “We are confident in our ability to accelerate their development under AEQUITA’s ownership approach,” said Christoph Himmel, Managing Partner at AEQUITA. The current agreement entered into takes the form of a put option deed, which grants the owner the right but not the obligation to sell an asset at a specific price. In this case, AEQUITA has agreed to purchase at the agreed-upon terms if LyondellBasell opts to exercise the option after concluding works council consultation processes. The financial terms of a sale have not yet been disclosed, but the current timeline would see the deal close in the first half of 2026, LyondellBasell added. The Europe review is part of a wider shift in footing towards three key pillars for the business. Announced in 2023, this is based on prioritizing spending on businesses where the company “has leading positions in expanding and well-positioned markets”, growing circular solutions earnings to $1 billion/year by 2030, and shifting from cost controls to a broader idea of value creation. The company’s strategy for its remaining European asset base will be based around sustainability and the circular economy, according to Lyondell CEO Peter Vanacker. “Europe remains a core market for LyondellBasell and one we will continue to participate in following this transaction with more of a focus on value creation through establishing profitable leadership in circular and renewable solutions," he said. Update adds detail throughout Thumbnail photo: LyondellBasell's site in Wesseling, Germany, one of the European assets it is retaining (Source: LyondellBasell)

05-Jun-2025

SINGAPORE (ICIS)–South Korea’s revised real GDP shrank by 0.2% on-quarter, unchanged from advanced estimates in April, the first on-quarter contraction in nine months, central bank data showed on Thursday. Exports fall 0.6% on drop in chemical products GDP growth forecasted at 1.0% – OECD US trade negotiations, economic policy on new president Lee’s agenda Real GDP growth shrank 0.1% year-on-year in January-March 2025 amid political turmoil from a martial law declaration as well as US tariffs, the Bank of Korea (BoK) said in a statement. Both manufacturing and exports decreased by 0.6% quarter on quarter, mainly on drops in production and export of chemical products as well as machinery and equipment. Private consumption decreased by 0.1% as consumers spent less on services such as recreation, sport, and culture, while government consumption remained at the same level as the previous quarter. South Korea elected its new president Lee Jae-myung on 4 June, ending six months of chaos wrought by former President Yoon Suk Yeol’s declaration of martial law, Singapore-based UOB Global Economics & Market Research said in a note on 4 June. His immediate goals will be to boost the economy and “restore livelihoods” while balancing US trade negotiations with China relations, as the two world’s largest economies continue talks towards ending a trade war. Lee has until 8 July, when a 90-day suspension on 25% “reciprocal” tariffs imposed by US President Donald Trump will be lifted, to negotiate a US trade deal. A supplementary spending package worth 0.1% of GDP, or won (W) 13.8 trillion ($10 billion), was approved by the government in May, while Lee has announced an economic task force to boost growth. Talks have been ongoing since April but with no definitive result due to South Korea’s presidential void. The country announced a snap election on 8 April after Yoon was impeached and removed from office. “Despite external uncertainties, the domestic outlook may start to pick up after the presidential election,” UOB said, forecasting a 1.0% GDP growth for 2025. The Organisation for Economic Co-operation and Development (OECD) expects the South Korean economy to recover in 2026, projecting growth by 2.2% in 2026, it said in a report on 3 June. However, the BoK sharply lowered its GDP forecast for 2025 to 0.8% from 1.5% previously, warning that tariffs and economic uncertainty would lead to weaker exports. “Going forward, domestic demand is expected to recover modestly but at a slower pace, while exports are expected to slow further due to the impact of US tariffs,” the BoK said on 29 May. Focus article by Jonathan Yee Thumbnail image: Mandatory Credit: Aerial view of a container pier in South Korea's southeastern port city of Busan (Source: YONHAP/EPA-EFE/Shutterstock) Visit the US tariffs, policy – impact on chemicals and energy topic page

05-Jun-2025

COLORADO SPRINGS, Colorado (ICIS)–Uncertainty surrounding tariffs is tempering what could be a recovery in US demand for polypropylene (PP), executives at Braskem said on Wednesday. Uncertainty about the final makeup of tariffs and their effects on end markets have caused consumers and companies to delay purchases, said Alexandre Elias, vice president, PP, North America and Europe, Braskem. Elias made his comments in an interview with ICIS on the sidelines of the annual meeting of the American Chemistry Council (ACC). Companies are reluctant to build inventories and make investments – especially industrial PP customers that have long investment cycles, Elias said. TARIFFS HAVE COUNTERVAILING EFFECTS ON AUTOAutomobiles are one of the main end markets for PP, and the tariffs have had mixed effects on production, contributing to the uncertainty of PP demand from the sector. The US has imposed tariffs on imports of automobiles and auto parts, which could ultimately stimulate local production and PP demand. Prior to those tariffs, consumers splurged on automobiles to beat the tariffs. All of that pre-buying lowered inventories of US autos, said Bill Diebold, vice president – commercial, Braskem America, polyolefins. US producers will ultimately replenish those inventories, which will further increase auto output and PP demand. On the other hand, consumer confidence has fallen after the introduction of the tariffs and that tends to slow demand growth for automobiles and other durable goods that are made with PP. Chinese restrictions on shipments of rare earth magnets could cause some automobile companies to shut down production within weeks if they cannot find workarounds, according to an article from the Wall Street Journal, a business publication. The US recently increased its tariffs on imports of steel and aluminium to 50% from 25%, which would increase production costs for US automobiles and potentially make them less affordable. The future of the tariffs themselves is uncertain because the US frequently changes the rates. It could impose new tariffs, and the courts could rule that the US lacks authority to impose them under a key provision. The interactions of all of these variables make it difficult to forecast PP demand from the US automobile industry, Elias said. PP DEMAND REMAINS FLAT YEAR ON YEARIn the US, PP demand is up in Q2 versus Q1 but flat year on year, Diebold said. Similarly demand improved in Q1 versus Q4, the latter of which was a challenging time for the US market, Diebold said. Packaging, another major end market for PP, remains strong. PP is enjoying a boost from a wave of product substitutions, Elias said. Over the years, many polystyrene (PS) processors have switched to PP because of its price. Many of those substitutions have played out, but a smaller wave is now taking place. That said, uncertainty could be capping the potential of product substitutions from other processors. LPG RESTRICTIONS TO CHINA COULD ALTER PP TRADE FLOWSGlobal trade flows of PP could change significantly if the US restricts exports of liquefied petroleum gas (LPG) to China. China relies heavily on US LPG shipments to provide feedstock for its large fleet of propane dehydrogenation (PDH) units, which produce on-purpose propylene. The US already has imposed restrictions on exports of ethane to China, which would disrupt a few ethane crackers in the country. If trade tensions rise, it could expand the restrictions to cover LPG. Global markets got a taste of the ramifications of restricted LPG shipments earlier this year when China increased tariffs on US imports by triple digits. Had China maintained those increases, Chinese propylene production would likely fall, according to ICIS. China could still procure LPG from exporters from other parts of the world, but that would increase costs and make some production uncompetitive. Lower Chinese propylene production would have a cascading effect. It could lower domestic production of PP and cut down on Chinese exports to other parts of Asia. That, in turn, could allow domestic Asian producers to sell more material locally, allowing them to be less aggressive about exporting PP, Elias said. "This could have a significant impact on trade flows globally," Elias said. In fact, restrictions on US LPG shipments to China would likely have a bigger effect on PP trade flows then actual tariffs on the resin. So far, the introduction of US tariffs has had little direct effect on US PP, because the market is relatively balanced. In 2023 and 2024, apparent consumption was about 85% of total production in the US, according to the ICIS Supply and Demand Database. Braskem does have an option to export PP from a terminal in Charleston, South Carolina, but this terminal functions more as a way to take advantage of arbitrage opportunities and leverage its PP plants in North America, Elias said. As an option, it has worked well. LITTLE NEED FOR NEW PROPYLENE CAPACITYBraskem relies on third parties for propylene for its PP plants in the US. So far, there is no need for Braskem to build its own propylene capacity, Elias said. The US is long in propylene, as illustrated by the global competitiveness of its exports, he said While Braskem has relied on propylene imports from Canada, trade tensions between it and the US have eased. Were trade tensions to resume and cause an increase in tariffs, Braskem could manage around it, Elias said. The ACC Annual Meeting runs through Wednesday. Focus article by Al Greenwood Thumbnail shows a product made with PP. Image by Shutterstock.

04-Jun-2025

SINGAPORE (ICIS)–Click here to see the latest blog post on Asian Chemical Connections by John Richardson. Is the petrochemicals industry really a free market? Or have we been telling ourselves a comforting fiction? As we sift through margins, P&Ls, and operating rates to predict a recovery, we might be asking the wrong questions. Let’s rewind to 2014. While China’s state media signalled a major push toward self-sufficiency in petrochemicals, many Western analysts dismissed it — seeing China through the lens of profit maximisation. But I was told way back in 2000 that China’s strategy had just as much to do with jobs and economic value creation as with profits. Fast forward to today: polyester fibres, , polyethylene terephthalate (PET) film and bottle grade resins, purified terephthalic acid (PTA), styrene and polypropylene (PP),— China is nearly or completely self-sufficient in these markets. The drivers? National security, supply certainty, and industrial policy. And it’s not just China. Middle East investments — underpinned by cheap feedstocks, state ownership, and now oil demand substitution — follow similar, non-market logic. If key players haven’t been led by market signals alone, what happens next? Despite the deepest downturn in petrochemical history — likely to stretch into 2028 — new capacities keep rising. Not from those chasing short-term profit, but from those with long-term, state-backed agendas. Just a modest rise in China’s PP operating rates above the ICIS base case assumption could flip China into being a net exporter by 2027. The trade war may play a role here, as it has increased supply security concerns. True, there are more private petrochemical companies in China than ten years ago. But this latest wave of investment is more state-owned-enterprise-led than the previous one. And private companies can also benefit from local and central government support Saudi investments in refinery-to-petrochemicals will persist. More ethane crackers in the Middle East will be built. China’s plant-build costs are often 50%+ lower than the U.S., thanks to relentless innovation support. So… what does this mean for producers operating on pure market terms? Can they survive, let alone thrive, in a landscape shaped by strategic ambition rather than shareholder return? Your thoughts are welcome. Let’s start the conversation. 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.

04-Jun-2025

SAO PAULO (ICIS)–Brazil's customs auditors have announced a new five-day "zero clearance period" at the Port of Santos on 2-6 June in which no physical inspections will be carried out, according to a letter to customers by logistics company Unimar seen by ICIS. The action at Santos – Latin America’s largest port – extends a strike started in 2024 which has disrupted logistics for months. The port is a key exit and entry point for some chemicals and a wide range of industrial goods, as well as of fertilizers imports feeding Brazil’s powerful agricultural sector. “Brazil’s Superior Courts have ruled that industrial action cannot entirely paralyze essential public services, such as the clearance of perishable cargo. Judicial intervention may be required to ensure the continuity of critical operations, assessed on a case-by-case basis,” said Unimar’s letter. “Currently, marine terminals at major ports have reported that most cargo is cleared automatically via the system, except for those not classified under the ‘Green Channel.’ Therefore, the strike is expected to primarily impact cargo that requires physical inspections.” Under normal conditions, average clearance times at Santos are five to seven days for imports and one to two days for exports – the action plan up to 6 June may cause delays for cargo requiring physical inspection, while clearance of vessel spare parts at major airports typically takes three to five days. Brazil's Superior Courts have ruled that industrial action cannot entirely paralyze essential public services, such as clearance of perishable cargo. Judicial intervention may be required to ensure continuity of critical operations on a case-by-case basis. A YEAR-LONG STRIKEThe strike by customs workers, with no sign of resolution in sight, is about to reach one year of duration, some of the longest strikes by civil servants ever seen in Brazil. Smaller strikes started to take place in mid-2024 but then escalated into a comprehensive two-month stoppage. Several rounds of talks between the union representing tax auditors and the government have failed to reach agreement. The union is demanding salary increases and better working conditions, including maintenance and upgrades at ageing customs points across Brazil. President Luiz Inácio Lula da Silva's government is attempting to control spending amid investor concerns about the fiscal deficit. Chemicals players have said to ICIS they are increasingly concerned about rising logistics costs, in part due to the strike. The trade group Brazilian Association of Distributors of Chemical and Petrochemical Products (Associquim) warned that companies handling perishable goods or materials requiring quick delivery – pharmaceuticals, food products – are facing particular difficulties. "We have chemical products that have to have a special place for storage, and if too much accumulates in those special storage places, then it will filter down to the end-user, and create a safety problem," said Associquim president Rubens Medrano earlier this year. NEW SYSTEM DEPLOYMENT AT RISKSomething most logistics players have mentioned and remain a key concern is how the strike could threaten the implementation of Brazil's New Import Process on the Single Foreign Trade Portal, approved in 2023 to reduce delivery times and costs. The system's third and most critical phase is due in the second half of 2025. Trade group the Brazilian Machinery Builders' Association (Abimaq) estimated the new system could save companies Brazilian reais (R) 40bn ($7.07bn) annually when fully implemented, nearly halving delivery times from nine days to five days through increased electronic processing. Meanwhile, the trade group representing chemicals producers Abiquim has equally warned that prolonged strike action could negatively impact the current implementation phase of the import system designed to simplify processes and reduce logistics costs. The Santos Port Authority had not responded to a request for comment at the time of writing. Front page picture: The Port of Santos in Sao Paulo state Picture source: Santos Port Authority  Additional reporting by Sylvia Traganida

03-Jun-2025

LONDON (ICIS)–Gas grid operators on the Trans-Balkan corridor have been working to enable traders to access natural gas via Greek LNG terminals or pipelines for shipments to Ukraine at a unified discounted tariff. The bundled transmission capacity product launched in May could open opportunities for diversification and tightening security of supply. Nevertheless, many traders say the format may not be compliant with EU network codes and insist they had limited information prior to the first auction held in May. As the five TSOs are preparing a new round of auctions, the Greek regulator RAE has started a consultation and companies are expected to submit their views by 9 June 2025. ICIS reporter Aura Sabadus has collected 15 questions from gas traders active regionally and invited Sotirios Bravos (DESFA), Nikola Delev, (Bulgartransgaz), Marius Lupean, (Transgaz), Liviu Duminica, (VMTG) and Andrii Prokofiev (GTSOU) to answer them in detail.

03-Jun-2025

COLORADO SPRINGS, Colorado (ICIS)–US-based chemical distributor Univar Solutions has better positioned itself for growth and resilience with a sharper focus on key industries, said the head of its Ingredients + Specialties (I+S) business. More than a decade earlier when the specialties business was underperforming, Univar undertook a major shift in strategy by setting up four focus industries – food ingredients, pharmaceuticals, coatings and beauty care – to run them as standalone business units, recalled Nick Powell, CEO of Global I+S. “Everybody in each of those business units, that's all they did – focus on those industries. Prior to that, any seller, product manager or technical person may have served an oil refinery in the morning, and in the afternoon a food customer – no differentiation, no ability to sell our value,” said Powell in an interview with ICIS. Powell spoke to ICIS on the sidelines of the American Chemistry Council (ACC) Annual Meeting) This new business model worked well in Europe where Powell led the changes, and was then replicated in the Americas and Asia-Pacific but with different leadership for each region, he said. Then Univar CEO David Jukes, who assumed the role in 2019, decided to globalize all of the distributor’s businesses into six focus industries – each of them under a single leader, said Powell. SIX FOCUS INDUSTRIESThese six focus industries now fall under two segments. The I+S division now has three focus industries – CARE (beauty & personal care, homecare & industrial cleaning), Health & Nutrition (food ingredients, pharmaceutical ingredients) and Performance Materials (coatings, adhesives, sealants and elastomers (CASE), lubricants and metalworking). The Chemical Distribution & Services (CD&S) division also has three focus industries – General Industrial, Refining & Chemical Processing, and Service Solutions. Univar’s online platform ChemPoint is its third division, focused on demand creation and multi-channel digital marketing campaigns for a wide range of chemicals and ingredients. “In essence, we’re able to adjust to the very specific needs of suppliers who are producing products that go into those spaces, or our customers who want to be treated differently, depending on their market,” said Powell. And in each of the focus businesses, Univar has specialists that can connect the value the supplier has in its product portfolio to the value it can generate for a customer, typically by helping solve a technical problem or producing a new product from its globalized network of laboratories that goes to market, he pointed out. The strategy has been “extremely successful” for Univar, allowing it to outperform its peers, he noted. GLOBALIZATION AND CUSTOMER WINSWith the globalization of the focus industries, Univar is able to provide suppliers the same type and level of service in any region, adding local nuance when appropriate, said the executive. “That gives them confidence that we can deliver for them. We found that suppliers have really liked that business model, and a number of them have been awarding us large pieces of new business in geographies where we've not dealt with them in those product portfolios,” said Powell. In February 2025, Univar announced an expanded distribution partnership with BASF, securing the exclusive right to serve as a distributor of LuquaSorb Superabsorbent Polymers (SAPs) in the US and Canada in industrial applications. In January 2025, Univar Solutions announced an exclusive distribution agreement for the US, Canada and Puerto Rico with dsm-firmenich, adding its skin actives and bioactive skin care ingredients including synthetic peptides, organically grown plant extracts and other natural ingredients. In November 2024, Univar announced a new exclusive distribution agreement with Syensqo to become, effective 1 January 2025, the sole distributor of its beauty care ingredients across the US and Canada. “We are able to demonstrate to them that we have this large specialty and ingredients business inside the portfolio that’s staffed by technical people who are able to take their products to market and gain value for them,” said Powell. “They were able to do that in conjunction with our solution centers (labs), helping customers solve problems or create new products to go and take more share in their marketplaces,” he added, calling the strategy a game changer of growth” for Univar. The ACC Annual Meeting runs through Wednesday. Interview article by Joseph Chang

03-Jun-2025