Americas top stories: weekly summary

HOUSTON (ICIS)–Here are some of the top stories from ICIS Americas for the week ended 25 September 2016.

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Too many new ships driving down US chem freights
Too many new ships continue to plague the chemical shipping market, with a recent report citing the growth of vessel tonnage for depressing freight rates on major US trade lanes. Freight rates on two major routes this year are flat to down, according to ICIS. Eastbound transatlantic rates for 5,000 tonnes remain flat compared to early January figures, while rates for the US Gulf-Asia route are down 13% for the year.

Shale gas remains mostly a US phenomenon
INEOS recently held a press tour with several UK journalists at two shale-gas sites in the northeast US, in an attempt to win support for its own drilling programme in England. INEOS would very much like to start producing shale gas in England, where it has a gas cracker in nearby Grangemouth, Scotland. But even as the shale-gas revolution approaches its first decade, it remains mainly a US phenomenon. INEOS itself has acknowledged that the UK will not produce significant amounts of shale gas any time soon.

Dynamics changing for Latin America PS market
The Latin America polystyrene (PS) market’s dynamic related to crystal and high impact (HIPS) resins has changed recently. The demand for crystal – a resin used to process disposable plastic cutlery and dinnerware – was described as good, while the demand for HIPS still remains soft, market participants said. The high price of HIPS was said to be softening its demand, as processors that have the technology switched to other lower-priced resins such as acrylonitrile butadiene styrene (ABS).

US glycerine markets restructure from net importer status
The US glycerine market is restructuring as a move is made from an historical net import position to self-sufficiency. Global supply remains lengthy and imports prevalent. The US market is seeing some stability in the fourth quarter this year but facing downward price pressure from supply length amid structural changes in the market because of increased domestic refining capacity and ample imported product looking into 2017.

US ethylene spot falls on easing concerns over supply
US ethylene spot prices receded from the previous week’s run-up as panic from recent supply concerns subsided. ICIS assessed prices on Friday were 35.000-40.625 cents/lb, from 38.250-42.000 cents/lb in the previous week. Spot had climbed in the previous week, following the shutdown of two more crackers for scheduled maintenance.

US federal court rules against OSHA on ferts policy
The District of Columbia Circuit Court of Appeals ruled on Friday that the US Occupational Safety and Health Administration (OSHA) acted illegally in imposing new safety requirements on fertilizer dealers. Specifically, the court determined that OSHA overstepped when it redefined exemptions for retail facilities included in the Process Safety Management (PSM) standard. The changes were set to go into effect 1 October.

US Senate panel eyes Bayer-Monsanto, other deals
North American farmers’ groups are raising their voices over the proposed merger by Bayer and Monsanto, while a congressional panel convenes on Tuesday to look into that and other deals. German chemical major Bayer would acquire US agriculture titan Monsanto for $66bn, which represents $128/share, by the end of 2017 in a deal that would capture a lion’s share of the US seed and crop protection business. However, it is subject to regulatory approvals, speculated to be a lengthy undertaking.

US Mosaic sued over Florida plant sinkhole impacts
Three Florida residents filed suit in US District Court on Thursday against Mosaic over a sinkhole at the fertilizer producer’s New Wales phosphate facility and the release of about 215m gallons of slightly radioactive water into the state’s aquifer. In the proposed class-action case, the plaintiffs assert that Mosaic’s conscious actions and omissions were in disregard to foreseeable risks to human health, safety and the environment.

US propylene inventories up for fourth straight week
US propylene inventories rose by 1.4% in the week ending on 16 September, marking the fourth consecutive week of increases, according to the US Energy Information Administration (EIA). The increase came despite a slight drop in refinery operating rates, as well as gasoline supplies. Propylene inventories are now at their highest level since 5 August, when stocks totalled 2.605m bbl.

US Federal Reserve leaves rate at 0.25-0.50%
The US Federal Reserve voted on Wednesday to keep the nation’s interest rate at 0.25-0.50%, but added that the argument for raising it has become more compelling. The Federal Open Market Committee (FOMC) “judges that the case for an increase in the federal-funds rate has strengthened, but decided, for the time being, to wait for further evidence of continued progress toward its objectives”.