Propylene oxide (PO)

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Crucial in the manufacture of a range of end products from cosmetics to antifreeze, propylene oxide is industrially produced and traded on a major scale. Keeping track of trading activity, prices, output levels and demand fluctuations across all the key markets around the world means monitoring vast amounts of data. The rapidly changing market dynamics create opportunities for producers, buyers, sellers and traders of propylene oxide. However, the key to success is world class market intelligence. Be sure you are on top of all the market fundamentals to act quickly and decisively to secure a profitable deal.

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Europe top stories: weekly summary

LONDON (ICIS)–Here are some of the top stories from ICIS Europe for the week ended 15 March. Europe ethylene and propylene sentiment cautiously optimistic for remainder of H1 Given the better-than-expected demand conditions, with improved sales volumes and higher prices lifting many out of the mire that was 2023, the question on everyone’s lips is how long can we expect this state of affairs to last. Potential for oil market deficit in 2024 as demand expectations grow – IEA Higher oil demand expectations and fresh production cuts from the OPEC+ alliance could push the 2024 crude market balance from a surplus to a slight deficit if the voluntary reductions remain in place for the rest of the year, according to the International Energy Agency. Surging PET bottle bale prices threaten to ‘destroy’ Europe’s R-PET market Feedstock bale prices hit €930/tonne ex-works in Poland on Monday, prompting recycled PET participants to suggest such price levels threaten to destroy the R-PET market as they fear a repeat of 2022’s disastrous price volatility. Europe acetic acid, VAM contract talks for March focus on supply disruption March negotiations are underway for European acetic acid and vinyl acetate monomer (VAM) contract pricing with security of supply a key influence on negotiations amid LyondellBasell’s force majeure in the US and other disruptions to global trade flows. Caution caps optimism as peak season arrives for Europe styrene market Spot activity in the Europe styrene market was moderate in the week ended 8 March, as players attended a key industry event, while cautious and conservative sentiment persisted alongside crosswinds from ongoing demand weakness and thin liquidity, high feedstock costs and reduced availability. Participants pointed to only slight improvements in demand and market optimism from levels seen in 2023. Europe cracker margins up on firmer ethylene, co-products pricing Cracker margins in Europe rose in the week on the back of firmer ethylene and co-product pricing, ICIS Margin Analysis showed on Monday.

18-Mar-2024

Lotte Chemical mulls 'strategic measures' for Malaysian-listed LC Titan

SINGAPORE (ICIS)–South Korean producer Lotte Chemical said on Thursday that it is exploring options for its Malaysian subsidiary, in response to local media reports that the unit is up for sale. "We are considering various strategic measures related to LC Titan [Lotte Chemical Titan] which is our subsidiary, but nothing has been decided so far," Lotte Chemical chief financial officer Seong Nak-sun said in a stock exchange filing. "We will re-announce the details within a month or when they are decided in the future," Seong added. Lotte Chemical and LC Titan could not be immediately reached for further comments on the potential sale. At 05:30 GMT, shares of the two listed companies were trading lower, with Lotte Chemical down 1.63% in Seoul, and LC Titan down 1.72% in Kuala Lumpur. According to media reports on Thursday, Lotte Chemical has already initiated the process of selling LC Titan, citing unnamed sources. "We're actively reviewing ways to optimize our portfolio, which includes considering the potential sale of LC Titan. However, a definitive decision has not yet been reached," an unnamed Lotte Chemical official was quoted by The Korea Economic Daily (KED) as saying. Lotte Chemical is approaching both domestic and international companies, along with private equity firms through investment banks, to be potential buyers for its Malaysian arm, KED reported. The Korean producer is planning to sell all outstanding shares of LC Titan traded on the Malaysian stock market, which is equivalent to 74.7% of the company, valuing the firm at around $550m based on current market capitalization, it added. LC Titan has incurred a second year of net loss, which widened to Malaysian ringgit (M$) 780.3m in 2023 as sales declined by 24% to M$7.65bn. Malaysia's LC Titan full-year financial results in thousand ringgit (M$) FY2023 FY2022 % change Sales           7,646,170         10,019,083 -23.7 Loss from operations           (868,001)         (1,041,451) -16.7 Net profit            (780,286)            (731,061) 6.7 Meanwhile, parent firm Lotte Chemical swung into a net loss last year. S Korea's Lotte Chemical full-year financial results in billion S Korean won (W) 2023 2022 % Change Sales 19,949 22,276 -10.4 EBITDA 839 185 353.5 Operating profit -333 -763 Net income -301 28 In the notes accompanying its financial results released on 7 February, Lotte Chemical had stated that that it “will pursue advancement and improvements to the business portfolio in order to actively respond to changes in the business environment of the petrochemical industry and improve profitability through efficient management of existing petrochemical businesses”. “The weak market conditions of the petrochemical industry are ongoing due to reduced demand and dropping product prices resulting from global uncertainties, as well as increased supply burdens caused by large-scale ethylene plant expansions in China,” it said. The acquisition of Malaysian company Titan Chemicals in 2010 was the Korean firm’s first foray into southeast Asia. The acquired company was rebranded Lotte Chemical Titan, and in 2017, was listed on the Malaysian bourse. LC Titan operates 12 plants at two sites in Johor, Malaysia; and holds a 40% stake in LOTTE Chemical USA based in Houston, Texas. In Indonesia, the company operates polyethylene plants, and in Q1 2022,  started construction of LOTTE Chemical Indonesia New Ethylene (LINE) Project, which will increase production capacity in Cilegon by 65% to 5.88m tonnes/year. The project is expected to produce 1m tonnes/year of ethylene; 520,000 tonnes/year of propylene; 250,000 tonnes/year of polypropylene (PP); and 140,000 tonnes/year of butadiene (BD). It is scheduled to be completed in 2025. Focus article by Nurluqman Suratman ($1 = M$4.71; $1 = W1,330) Thumbnail image: A Lotte Chemical Titan plant in Pasir Gudang, Malaysia (Source: Lotte Chemical Titan)

07-Mar-2024

Indorama Ventures will divest, right-size assets and cut costs under revised strategy

LONDON (ICIS)–Fundamental long-term changes in global chemicals markets have prompted a significant review of strategy, Indorama Ventures said on Monday. The company suffered a heavy loss in 2023 against the backdrop of oversupplied markets and weak demand. Supply side pressure and weaker demand in China are among the factors that have created unprecedented industry conditions it said. It is shifting strategy to right-size operations, deleverage its business and cut costs. The company reported a 53% drop in earnings for 2023 as revenues fell by 17%, with fourth quarter EBIDTA down 46% on 8% lower sales. A net loss for the year of $310 million (from a profit of $884 million in 2022) included an asset impairment on an incomplete plant in Texas. The company said that it plans to reduce net debt by $2.5 billion to around $4.3 billion in 2026. This includes generating $800 million in cashflow from “operational improvements” and a further $1.7 billion from actions including divestments, “asset actions” and “select business listing”. The aim is to reduce its debt to EBITDA (earnings before, interest, tax, deprecation and amortisation) ratio to less than 3X. An asset optimization program is targeted at lifting the company’s operating rate from 74% to 89%, it said. This will include “moving to lower-cost facilities and right sizing manufacturing capacity”, it added. A further $450 million run rate of efficiency gains is planned to be in action by 2026. The sale of non-core assets and other “value unlocking strategies” aims to generate about $1.3 billion in cash proceeds. Indorama Ventures said that by leveraging sustainability innovation it can create an additional $350 million/year of value. Under the revised strategy the company’s Integrated Oxides and Derivative (IOD) business segment will be renamed Indovinya. Intermediate chemicals assets, including integrated purified ethylene oxide (PEO), ethylene glycol (EG) and methyl tertiary butyl ether (MTBE) assets will move to Indorama Ventures’ Combined PET (CPET) segment. Indovinya will focus on downstream products and for Indorama Ventures markets will include home & personal care, crop solutions, coatings & solutions and energy & resources, it said. A run rate of $527 million in efficiency gains was achieved in 2023 and the roll out of a new enterprise management system in 2024 will unlock further value, it added. A $308 million non-cash impairment was taken in Q4 2023 it said on the suspension of activity on the partially completed purified terephthalic acid (PTA)-polyethylene terephthalate (PET) joint venture with Alpek in Corpus Christi, Texas.

04-Mar-2024

Korea’s S-Oil targets $2bn capex for Ulsan oil-to-chems project in '24

SINGAPORE (ICIS)–South Korean refiner S-Oil has earmarked won (W) 2.72tr ($2bn) this year for its thermal crude-to-chemical (TC2C) project called Shaheen, representing 87% of the total capital expenditure (capex) set for 2024. The full-year capex at W3.14tr was up 54% from 2023, the company said in its Q4 results presentation released in early February. Construction of Shaheen at the Onsan Industrial Complex of Ulsan City started in March 2023 and will be in full swing this year, with mechanical completion targeted by the first half of 2026. The funds that will go to the project – whose name was derived from the Arabic word for falcon – were up 86% from 2023 levels. As of end-December 2023, site preparation was 48% complete, with engineering, procurement and construction at 18.7%, according to S-Oil. “Site preparation and EPC [engineering, procurement and construction] work is under full-fledged execution with the actual progress going smoothly according to the plan,” the company said. The project will leverage on the T2C2 technology of its parent company Saudi Aramco, the world’s biggest crude exporter. Aramco owns more than 63% of S-Oil. The project is expected to yield 70% more chemicals, with a capex/operating expenditure savings pegged at 30-40% versus conventional process. Meanwhile, for upgrade and maintenance of plants in 2024, total expenses will fall by about 32% to W298bn, with just two plants due for turnaround in the year – its No 1 crude distillation unit (CDU) and its No 1 lube HDT (hydrotreatment) unit, the company said in the presentation, noting that the plan is preliminary. ICIS had reported that S-Oil will conduct maintenance at its Group I and Group II base oils units in Onsan, Ulsan for more than a month from mid-September this year. On 23 February 2024, a fire broke out at the company’s Onsan production site in Ulsan, shutting one of the three crude distillation units (CDUs) of its 669,000 bbl/day refinery, with some reduction in propylene output of the residue fluid catalytic cracker (RFCC) at the site, industry sources said. Other downstream operations at the site were not affected, but this could not be immediately confirmed with the company. Its Onsan complex can produce 910,000 tonnes/year of propylene; 187,000 tonnes/year of ethylene; 600,000 tonnes/year of benzene; and 1m tonnes/year of paraxylene (PX), according to the ICIS Supply & Demand Database. The company was planning to restart the No 3 CDU by 27 February, news agency Reuters reported, quoting unnamed sources. 2023 NET PROFIT SLUMPSS-Oil posted a 54.9% slump in net profit, with sales sliding by about 16% to as operating rates across its plants declined. in billion won (W) FY2023* FY2022 Yr-on-yr % change Revenue 35,726.7 42,446.0 -15.8 Operating income 1,354.6 3,405.2 -60.2 Net income 948.8 2,104.4 -54.9 *Revised figures from S-Oil on 26 February 2024 in billion won (W) FY2023 FY2022 Yr-on-yr % change Refining operating profit 399.1 2,344.3 -83.0 Petrochemical operating profit 203.7 -49.8 -509.0 Lube operating profit 815.7 1,110.7 -26.6 Source: S-Oil presentation, 2 February 2024 Average operating rates across the company’s plants declined and were in the  range of 75.1% to 90.4% in 2023 due to weakening global demand, with paraxylene (PX) plants registering the lowest run rate. Source: S-Oil, February 2024 2024 OUTLOOK “Regional refining markets are forecast to maintain an above average level by steady demand growth coupled with low inventory levels,” S-Oil said. Refining margins in the first quarter will likely be supported by “heating demand in winter and spring maintenance season", it said. “With uncertainties on start-up timing and pace of major new refineries, market impact is estimated to be restricted in 2H [second half] or beyond,” the company said. Paraxylene (PX) and benzene markets “are projected to be supported by firm demand growth” on the back of new downstream expansions as well as demand for gasoline blending, “amid drastically reduced capacity addition”. Polypropylene (PP) and propylene oxide (PO) markets “are likely to gradually improve in tandem with pace of China’s economic recovery, while pressures from capacity addition continues”, while for lube base oils (LBO), the product spread is projected to be solid “on limited capacity additions and sustained demand growth”, according to S-Oil. Thumbnail image: S-Oil's Residue Upgrading Complex (RUC) and the Olefin Downstream Complex (ODC) in Ulsan, South Korea (Source: S-Oil) Focus article by Pearl Bantillo ($1 = W1,334)

29-Feb-2024

AdvanSix petitions US to impose Superfund taxes on imports of nylon 6, capro

HOUSTON (ICIS)–AdvanSix has requested that the US impose Superfund taxes on imports of nylon 6 and caprolactam (capro). On Tuesday, AdvanSix did not immediately respond to a request for comment. AdvanSix proposed a tax rate of $14.77/ton. The next step is for the government to gather comments and consider requests for hearings about AdvanSix's request. The deadline to file comments or request hearings is 22 April. HOW THE SUPERFUND TAX WORKSThe US introduced the Superfund taxes in mid-2022 on taxable chemicals and imports of taxable substances. The proceeds raised by the taxes will help replenish the government's Superfund program, which pays for clean-up at waste sites. The Superfund tax regime divides materials into two groups. The first group is levied on the sale or use of 42 chemicals by producers or importers. Many of these chemicals are fundamental building blocks such as ethylene, propylene, butadiene (BD), benzene, toluene, xylene and methane. The second group is restricted to imports and covers substances that are sold or used in the US. This second batch of taxes applies to substances that contain at least 20% of the 42 taxable chemicals. In addition, the taxable rate would depend on the proportion of the 42 taxable chemicals contained in the substance. The request by AdvanSix falls under this second group. As part of its request AdvanSix filed two petitions asking the US to add nylon 6 and capro to its list of taxable substances. Thumbnail shows nylon Image by Shutterstock.

27-Feb-2024

Europe top stories: weekly summary

LONDON (ICIS)–Here are some of the top stories from ICIS Europe for the week ended 23 February. Europe PE/PP contract prices reach three figure hikes for February Contract prices for European polyethylene (PE) and polypropylene (PP) have settled upwards from initial moves earlier in February, in the pivotal third week of the month. Chemical firms back call for stronger business environment in EU The chief executives of BASF, INEOS, Covestro, Clariant and Dow Europe among others on Tuesday backed a new declaration calling for stronger European Commission prioritisation of business, calling for an industrial deal to be placed at the core of the new Parliament. Europe propylene limitations raise concerns down value chain The European propylene (C3) supply and demand balance is in a tighter than expected position due to a combination of healthy demand and planned and unplanned production constraints. BASF navigates low-growth environment as China Verbund spending continues As BASF prepares to provide more detail on its 2023 financial performance, the Germany-based chemicals major is to navigate the still-chilly waters of 2024 as spending on its flagship China Verbund site in Zhanjiang continues and project pipelines face ever-tougher scrutiny. INSIGHT: EU chemicals plead for help while production sinks to 1999 levels As chemical production in Europe plunges to levels last seen during the 2008/9 financial crisis and back in 1999, industry leaders are urging the EU to improve the regulatory framework and do more to protect them from unfair competition. But with the fundamentals of supply and demand so out of balance globally, there are limits to how much politicians can achieve in Europe.

26-Feb-2024

TOPIC PAGE: Sustainability in the fertilizers industry

Updated on 26 February. On this topic page, we gather the latest news, analysis and resources, to help you to keep track of developments in the area of sustainability in the fertilizers industry. LATEST NEWS HEADLINES Germany’s Heraeus invests in Japanese ammonia tech company By Stefan Baumgarten 22-Feb-24 LONDON (ICIS)–German technology group Heraeus has invested an undisclosed amount in Tsubame BHB, a Japanese company that has developed a precious metal-based technology for decentralized ammonia production. Malaysia’s PCG, Sarawak Petchem agree to study low-carbon ammonia and urea plant By Nurluqman Suratman 21-Feb-24 SINGAPORE (ICIS)–Malaysia’s PETRONAS Chemicals Group (PCG) and methanol producer Sarawak Petchem on Wednesday signed an agreement for a joint feasibility study aimed at establishing a low-carbon ammonia and urea production facility in Bintulu, Sarawak. Egypt’s Helwan signs agreement to produce black urea By Deepika Thapliyal 20-Feb-24 LONDON (ICIS)–In Egypt, Helwan has signed an agreement with SML-INNO UK Ltd to set up the world's first vertical integrated unit to produce black urea, with a capacity of 130,000 tonnes annually, the company said today. EU eases climate proposals after widespread farmer protests By Chris Vlachopoulos 07-Feb-24 LONDON (ICIS)–European Commission President Ursula von der Leyen announced on Tuesday that the EU has agreed to ease key demands in its climate proposal plans, following intense protests from farmers. Tecnimont awarded engineering contract for Portugal green hydrogen, ammonia plant By Graeme Paterson 05-Feb-24 LONDON (ICIS)–Tecnimont has been awarded an engineering contract to develop an integrated green hydrogen and green ammonia plant at Sines, Portugal, its parent company Maire said on Monday. EU proposes relaxation in policy following farmer protests By Deepika Thapliyal 31-Jan-24 LONDON (ICIS)–The European Commission Wednesday proposed relaxing green farming requirements under the Common Agricultural Policy (CAP), in its first attempt to quell farmer protests across Europe as the sector struggles to stay economically viable. Biden Administration invests $207m in domestic fertilizer and clean energy endeavours By Chris Vlachopoulos 23-Jan-24 LONDON (ICIS)–The Biden Administration is investing $207m in domestic fertilizer and renewable energy projects, the US Department of Agriculture (USDA) Secretary Tom Vilsack announced on Monday, 22 January. Brazil’s state of Ceara, Bp sign MoU for green hydrogen site By Jonathan Lopez 18-Jan-24 SAO PAULO (ICIS)–The government of the Brazilian state of Ceara and UK-headquartered energy major Bp signed this week a Memorandum of Understanding (MoU) to build a green hydrogen site. Atome Energy in talks with buyers for green fertilizer from Paraguay unit By Manuja Pandey 17-Jan-24 LONDON (ICIS)–UK's Atome Energy Plc is in advanced negotiations with leading international players for the offtake of green calcium ammonium nitrate (CAN) fertiliser from its production facility in Villeta, Paraguay. Sweden's Cinis targets Asia potash market with Itochu partnership By Andy Hemphill 16-Jan-24 LONDON (ICIS)–Swedish green-tech start-up Cinis Fertilizer has signed a letter of intent (LOI) with Japan-headquartered trading house Itochu to launch its environmentally-friendly mineral fertilizer in the Asian market. Helwan selects Eurotecnica's Euromel G5 technology for new melamine facility in Egypt By Melissa Hurley 15-Jan-24 LONDON (ICIS)–Eurotecnica has been selected by Helwan Fertilizers Company (HFC) for the implementation of a world-scale melamine plant based on proprietary Euromel G5 melamine technology, the technology arm of Switzerland's Proman said on Monday. India’s Adani Group plans $24bn green energy park; RIL to commission giga complex By Priya Jestin 12-Jan-24 MUMBAI (ICIS)–India’s western Gujarat state is set to become the domestic hub of green energy projects following an announcement by the Adani Group to set up a large green energy park and Reliance Industries Ltd (RIL) set to commission its giga complex in the state soon. INPEX and LSB pick technology for US ammonia project By Stefan Baumgarten 10-Jan-24 HOUSTON (ICIS)–INPEX Corp and LSB Industries have chosen KBR’s blue ammonia technology for a planned 1.1m tonne/year low-carbon ammonia project on the US Gulf Coast, KBR said on Wednesday. Bayer partners with energy firms on hydrogen cluster in Germany By Stefan Baumgarten 09-Jan-24 LONDON (ICIS)–Pharmaceuticals and agrochemicals company Bayer has signed a memorandum of understanding (MoU) with three energy firms – E.ON, Iqony and Westenergie – to establish a hydrogen cluster at its Bergkamen production site near Dortmund, at the eastern edge of Germany's Ruhr industrial region. At the core of the project will be the production of green hydrogen from imported ammonia. S Korean group picks KBR tech for Malaysian green ammonia project By Al Greenwood 08-Jan-24 HOUSTON (ICIS)–A South Korean consortium has chosen KBR's K-GreeN process technology for a green ammonia project that it will develop in Sarawak, Malaysia, the US-based engineering company said on Monday. Abu Qir signs MoU for green ammonia project in Egypt By Sylvia Traganida 03-Jan-24 LONDON (ICIS)–North Abu Qir for Agricultural Nutrients has signed a memorandum of understanding (MoU) with ABB International Group, MPS Infrastructure Company, and Petrojet for the supply of green hydrogen and renewable electricity. EU CARBON BORDER ADJUSTMENT MECHANISM (CBAM) EXPLAINED What is it? The risk of carbon leakage frustrates the EU’s efforts to meet climate objectives. It occurs when companies transfer production to countries that are less strict on emissions, or when EU products are replaced by more carbon-intensive imports. This new mechanism would counteract this risk by putting a carbon price on imports of certain goods from outside of the EU. How will it work? EU importers will buy carbon certificates corresponding to the carbon price that would have been paid, had the goods been produced under the EU's carbon pricing rules. Conversely, once a non-EU producer can show that they have already paid a price for the carbon used in the production of the imported goods, the corresponding cost can be fully deducted for the EU importer. This will help reduce the risk of carbon leakage by encouraging producers in non-EU countries to make their production processes greener. A reporting system will apply from 2023 with the objective of facilitating a smooth roll out and to facilitate dialogue with non-EU countries. Importers will start paying a financial adjustment in 2026. How is the fertilizer industry affected? The fertilizer industry is one of the sectors to fall under the CBAM. The more energy-intensive nitrogen fertilizers will be affected most in the sector by the mechanism. DEFRA CONSULTATIONS EXPLAINED The UK’s Department for Environment, Food & Rural Affairs (DEFRA) launched a consultation at the beginning of November 2020 on reducing ammonia emissions from urea fertilizers. The consultation ran until 26 January 2021. It set out three options for tackling ammonia emissions: A total ban on solid urea fertilizers A requirement to stabilise solid urea fertilizers with the addition of a urease inhibitor. A requirement to restrict the spreading of solid urea fertilizers to between 15 January and 31 March of a given year. Liquid urea is excluded from any new rules or restrictions. DEFRA is currently analysing the feedback received. In March 2022, DEFRA announced that it had delayed introducing restrictions on the use of urea by at least a year to support farmers with fertilizer availability and keep their costs down Should DEFRA decide to restrict the use of urea in the future, growers would be left with just ammonium nitrate-based fertilizers. PREVIOUS  NEWS HEADLINES Yara aims to launch first container ship to run off clean ammonia India’s Odisha state approves green hydrogen, ammonia, methanol projects ADM announces launch of regenerative agriculture program in Brazil Fertiglobe completes first renewable ammonia shipment with carbon certification Allied Green Ammonia picks Topsoe’s tech for Australia project Germany’s VNG looks to secure offtake from Norwegian low carbon ammonia plant Gentari enters into agreement with AM Green to invest into a green ammonia delivery platform ITOCHU Corporation, Orascom Construction sign MOU for development of ammonia bunkering in Suez Canal India developing port infrastructure for green hydrogen exports S Korea, Saudi Arabia firms sign 46 pacts, includes blue ammonia project INSIGHT: CBAM reporting begins, fertilizer exporters to EU challenged to account for carbon KBR to supply green ammonia tech to Madoqua Power2X site in Portugal Germany’s SOM to build green hydrogen, ammonia facility in Brazil’s Piaui state US ADM and Syngenta sign MoU to collaborate on low carbon oilseeds to meet biofuel demand Tecnicas Reunidas, Allied Green Ammonia to build green hydrogen and green ammonia plant in Australia Australian fertilizer producer Orica accelerates climate change targets Nestle, Cargill and CCm Technologies launch joint UK trial on sustainable fertilizer EnBW acquires stake in planned Norwegian ammonia plant  Yara Germany signs agreement for decarbonisation of cereal cultivation using green fertilizers Hyphen, ITOCHU ink MoU to explore potential Namibia hydrogen collaboration  INSIGHT: BASF grapples with demand trough, slow road back SABIC AN ships low-carbon urea to New Zealand US Cargill and John Deere collaborate to enable revenue for farmers adopting sustainability Canada’s Lucent Bio announces approval of biodegradable nutrient delivery patent Aker, Statkraft’s 10-year PPA to spur European renewable ammonia push further BASF, Yara Clean Ammonia to evaluate low-carbon blue ammonia production facility in US Gulf Coast Yara Clean Ammonia, Cepsa to launch clean hydrogen maritime corridor EU details CBAM reporting obligations Saudi Arabia’s Ma’aden exports its first low-carbon blue ammonia shipments to China US Bunge and Nutrien Ag announce alliance to support sustainable farming practices Maire subsidiary Stamicarbon wins US green ammonia engineering contract India’s IFFCO launches liquid nano-DAP fertilizer EU Parliament backs CBAM, emissions trading measures OCP granted €100m green loan to build solar plants at Morocco facilities EU unveils plans to tackle greenwashing India’s IFFCO and CIL to manufacture nano DAP for three years USDA awards Ostara funds to boost sustainable phosphate fertilizer output Canadian prime minister confirms fertilizer emission goal is voluntary US fertilizers industry increases carbon capture in 2021 – TFI Indian president calls for reduction in chemical fertilizer use IFFCO plans to export nano urea to 25 countries Amman selects Elessent Clean Technologies for Indonesia sulphuric acid plant Lotte Chemical forms clean ammonia consultative body with RWE and Mitsubishi Corporation Global 2020-2021 specialty fertilizer demand growth led by north America, Asia BASF and Cargill extend enzymes business and distribution to US Saudi Aramco awards sulphur facilities overhaul contract to Technip India sets green hydrogen targets for shipping, oil & gas, fertilizer sectors Germany misses climate target despite lower energy consumption TFI reacts to US Congress passing the Water Resources Development ActHelm becomes a shareholder in UK bio-fertilizer company Unium Bioscience Yara inks deal to deliver fossil-free green fertilizers to Argentina Canadian firms plan fuel cell generator pilot using green ammonia Deepak Fertilizers awards contract to reduce emissions, increase productivity Saudi Aramco launches $1.5bn sustainability fund to support net zero ambition CF Industries and ExxonMobil plan CCS project in Louisiana Canada’s plan to cut fertilizer emissions is voluntary – minister Canada’s fertilizer emission goal raises food production concerns Uniper, Vesta to cooperate on renewable ammonia site in the Netherlands German Uniper to work with Japan’s JERA on US clean ammonia projects ADNOC ships first cargo of low-carbon ammonia to Germany US Mosaic and BioConsortia expand collaboration to microbial biostimulant IMO deems Mediterranean Sea area for sulphur oxides emissions control Canada's Soilgenic launches new enhanced efficiency fertilizers technology for retail Austria's Borealis aims to produce 1.8m tonnes/year of circular products by 2030 European Parliament rejects proposed carbon market reform IFA ’22: southern Africa looks to bio-fertilizer as cheaper, sustainable option IFA '22: Indian farmers will struggle to embrace specialty fertilizers – producer Canadian Nutrien plans to build world’s largest clean ammonia facility in Louisiana Japan's JGC Holdings awards green ammonia plant contract to KBR Bayer to partner with Ginkgo to produce sustainable fertilizers Australia Orica and H2U Group partner on Gladstone green ammonia project Canada sets tax credit of up to 60% for carbon capture projects UK delays urea restrictions to support farmers as fertilizer costs at record high EU states agree to back carbon border tax Yara to develop novel green fertilizer from recycled nutrients USDA announces plans for $250m grant programme to support American-made fertilizer Canada seeks guidance to achieve fertilizer emissions target Fertilizer titan Pupuk Indonesia develops hydrogen/blue ammonia business India launches green hydrogen/ammonia policy, targets exports Canada AmmPower to develop green hydrogen and ammonia facility in Louisiana US DOE awards grant to project to recover rare earth elements from phosphate production Fertiglobe, Masdar, Engie to develop green hydrogen for ammonia production Czech Republic’s Spolana enhances granular AS production India’s Reliance to invest $80bn in green energy projects Yara, Sweden’s Lantmannen aim to commercialise green ammonia by 2023 Novatek and Uniper target Russia to Germany blue-ammonia supply chain Fertz giant Yara goes green with electrification of Norwegian factoryCanada Arianne Phosphate exploring use of phosphate for hydrogen technology FAO and IFA renew MoU to promote sustainable fertilizer use Sumitomo Chemical, Yara to explore clean ammonia collaboration Sri Lanka revokes ban on imports Tokyo scientists convert bioplastic into nitrogen fertilizer Aramco plans Saudi green hydrogen, ammonia project China announces action plan for carbon peaking & neutrality Saudi Aramco targets net zero emissions from operations by 2050 Fertiglobe goes green with Red Sea zero-carbon ammonia pro Australian fertilizer major Incitec Pivot teams up for green ammonia study INTERVIEW: BASF to scale up new decarbonisation tech in second half of decade – CEO India asks fertilizer companies to speed up production of nano DAP Japan's Itochu set to receive first cargo of blue ammonia for fertilizer use Norway's Yara acquires recycled fertilizers maker Ecolan Bayer Funds US start-up aims to cut nitrogen fertilizer use by 30% BP: Green ammonia production in Australia feasible, but needs huge investment Origin and MOL explore shipping green ammonia from Australia India’s IFFCO seeks to export nano urea fertilizer Sri Lanka reinstates ban on import of chemical fertilizers Nutrien to cut greenhouse gas emissions 30% by 2030 RESOURCES IFA – Fertilizers and climate change  TFI – Sustainability report 

26-Feb-2024

PODCAST: Asian olefins to see support amid tighter supply, Panama congestion persists

SINGAPORE (ICIS)–Asia's ethylene (C2) market saw supply tighten amid fewer volumes from the US in Q1 as a direct result of congestion at the Panama Canal. Over in the Asian propylene (C3) markets, while arbitrage flows remain curtailed by high freight rates, some emerging interest has been gleaned in the market as regards moving Asian material westwards. In this podcast, ICIS market editors Josh Quah  and Julia Tan discuss Asia's olefins flows, with a forward view on the March market. C2 sees support from constrained deep-sea supply NE Asia C2 and C3 outlooks for March Impact of shipping congestion on olefin trade flows

21-Feb-2024

Asia petchem markets await China's demand signals after holiday

SINGAPORE (ICIS)–Asia's petrochemical markets will closely watch China's demand signals after the Lunar New Year holiday amid ongoing concerns about the country’s economic health. Asia markets eye China's post-holiday demand signals China's economic health remains central concern Prices likely to rise amid supply constraints Markets in Asia took a breather in the week of 12-16 February, with Lunar New Year holidays in China, Taiwan, Malaysia and Singapore, while countries such as South Korea, Japan and Indonesia observed public holidays as well. Market participants are cautious about the post-holiday market; while some downstream buyers will restock after the holidays, there is concern that existing inventory held by domestic China producers and distributors will largely satisfy demand until early March. PRICES LIKELY TO RISE AMID SUPPLY CONSTRAINTSPetrochemical prices in Asia are expected to continue to increase in February, supported by capacity losses from outages and run-rate reductions, according to ICIS analysts. Among the 31 major petrochemical commodities covered by the ICIS Asia Price Forecast, average February prices for at least 22 of these commodities are anticipated to increase. Ethylene (C2), butadiene (BD) and styrene butadiene rubber (SBR) are expected to lead in terms of gains. In Asia’s C2 market, end-users who have yet to settle March arrival cargo are expected to hit the ground running once most of players return to the market this week. In the southeast Asia C2 market, demand enquiries were largely heard from Thailand last week, while other end-users in Indonesia have begun to look towards the April window for spot cargo. "The Asia C2 industry is likely to be characterised by tight supply in the weeks to come," said Paolo Scafetta, ICIS senior olefins analyst. "February should see about 7% of total monthly nameplate capacity lost due to downtime unless unplanned events cause further technical hiccups." The upstream naphtha market in Asia should be influenced by a few bearish factors, Scafetta added. These include the shift from naphtha to liquefied petroleum gas (LPG) as an alternative cracking feedstock and an improvement in supply from March as naphtha cargoes are expected to increase as Middle East refineries return from their maintenance. Asia's naphtha market is likely to be plagued with volatility in the short term as tensions in the Red Sea will continue to disrupt supplies. In Asia’s propylene (C3) market, trade was largely subdued during the Lunar New Year break but picked up towards the close of the week with most market players, except China, returning from their holiday. Talks and discussions in Taiwan commenced at the end of the week after the holidays ended. However, the post-holiday buying sentiment weakened on the back of ample supply, leading sellers to progressively lower their offers and selling indications. With buyers in China largely away from the market, overall business activity during the week was muted. In southeast Asia, while demand was also heard in Malaysia and Indonesia, most buyers continued to hold back from purchases on the expectation that supply tightness might result in an easing in offers down the road. In Asia’s benzene market, post-holiday restocking is expected to pick up in the second half of February amid strong competition for April and May cargoes from global players. February and March benzene cargoes have been already sold out and April cargoes are in strong demand. Benzene buyers based in both Asia and the West had actively sought procurement since end-January, for pre-holiday and pre-summer stocking up respectively. Asia's acetone market looks poised to maintain its strength. This is due to the high prices of benzene, reduced production leading to tighter supply, and a resurgence in trading flows between Asia and the West. A significant increase in demand for Asia acetone from the US market is bolstering this trend. Limited supply in the US, a result of low phenol production and ongoing allocations, is driving this demand. Meanwhile, supply within Asia is also constrained as phenol/acetone producers scale back production in response to unprofitable margins and decreased demand for phenol in China. In the xylene markets, further support in the market will be dependent on downstream sectors after the Lunar New Year holidays, with eyes firmly on China. For paraxylene (PX), there remains optimism for gasoline-blending demand heading into the second quarter, with positive arbitrage window economics for exports to the West. Firm upstream naphtha prices have also provided some support for PX. Several market participants noted there had been pre-buying of mixed xylenes (MX) and toluene by gasoline blenders to the US. Demand and price developments in the downstream purified terephthalic acid (PTA) and polyester sectors will help provide clarity about whether high PX costs can be absorbed down the chain. Asia's butyl acetate (butac) and ethyl acetate (etac) markets are poised to stay afloat on anticipated post-holiday demand, albeit at a gradual pace. Sellers of butac in both China and the region largely maintained their spot offers for March loading prior to the Lunar New Year holiday. Spot butac prices were on a downtrend in the early part of the fourth quarter of 2023 and have climbed since December, in part driven by cost pressures upstream as suppliers worked towards mitigating compressed margins. Asia’s methylene chloride (MEC) market might be bullish after the Lunar New Year holiday, as rising demand is likely to shift the market to a more balanced state. Most buyers were in a wait-and-see mode, monitoring prices and observing what producers would offer after the Lunar New Year break, with market participants in southeast Asia eyeing a rebound in demand through Q2, around the Ramadan period. CHINA'S ECONOMIC HEALTH IN FOCUS ICIS analysts expect most of China's end-use consumption, including in industries such as agriculture and home appliances, to recover from March. The China government's Two Sessions policy meetings, widely seen as the most important political meeting of the year for the country, will be held on 4-11 March. ICIS analysts expect another series of policies to be introduced to stimulate economic growth. Further market and infrastructure investment can boost petrochemicals demand. Latest official data from China is pointing to some recovery from domestic tourism trips and revenues. Domestic tourism trips and revenues during the Lunar New Year holidays in China jumped by 34.3% and 47.3% year on year respectively, with their levels at 19.0% and 7.7% above pre-pandemic levels in 2019, data from the country’s Ministry of Culture and Tourism (MCT) shows. "Most official and private media channels have been reporting strong (or even exceptionally strong) Lunar New Year holiday consumption data, and markets risk getting caught up in the euphoria of the moment, under the supposition that China’s economy is suddenly bottoming out, driven by the Chinese people’s hidden passion for spending," research analysts from Japan's Nomura Global Markets Research said in a note. "Although we do see some strength in the data, we urge market participants to exercise caution," it said, adding that China's property sector continued its downward spiral, right before the Lunar New Year holiday, and there was no sign of a recovery during the holiday. "Despite the positive [Lunar New Year] data, we maintain our view that the ongoing economic dip is likely to worsen into the spring," Nomura said. With additional reporting by Josh Quah, Julia Tan, Seng Li Peng, Angeline Soh, Helen Lee, Keven Zhang, Melanie Wee and Samuel Wong Focus article by Nurluqman Suratman Thumbnail photo: Lunar New Year lanterns in Shenyang, northeast China's Liaoning Province, on 1 February 2021. Asia will closely watch China's demand signals after the Lunar New Year holiday amid concerns about the country’s economic health. (Source: Xinhua/Shutterstock)

19-Feb-2024

Asia top stories – weekly summary

SINGAPORE (ICIS)–Here are the top stories from ICIS News Asia and the Middle East for the week ended 16 February 2024. Singapore Jan petrochemical exports rise 8.7%, NODX up 16.8% By Nurluqman Suratman 16-Feb-24 09:55 SINGAPORE (ICIS)–Singapore’s petrochemical exports in January rose by 8.7% year on year to Singapore dollar (S$) 1.11bn ($822m), with non-oil domestic exports (NODX) posting a 16.8% growth for the month, official data showed on Friday. Asia fatty acids market faces cost pressures on strong palm oil prices By Helen Yan 15-Feb-24 13:10 SINGAPORE (ICIS)–Asia’s fatty acids market is likely to face costs pressures from recent spikes in upstream crude palm oil (CPO) prices, while demand is expected to stay tepid. PODCAST: Asia R-PE, R-PET see slow 2023; legislations, waste management to shape future By Damini Dabholkar 15-Feb-24 14:07 SINGAPORE (ICIS)–Asia recycled polymers markets were sluggish for the most part in 2023. In early 2024 too, challenges that dim the short-term outlook persist. INSIGHT: Indonesia polls raise questions over Nusantara, import curbs By Pearl Bantillo 13-Feb-24 19:27 SINGAPORE (ICIS)–Indonesia, southeast Asia’s biggest economy, will go to the polls on 14 February to elect a new president, posing uncertainties on continuity of economic policies, from import restrictions coming into effect in March to incumbent President Joko Widodo’s flagship project of building a new capital called Nusantara in Kalimantan province. Asian EPDM market quiet amid holidays; demand outlook mixed By Ai Teng Lim 13-Feb-24 17:22 SINGAPORE (ICIS)–Discussions for Asian spot imports of ethylene propylene diene-monomer (EPDM) ground to a halt this week, with much of Asia out of action on extended Lunar New Year holidays.

19-Feb-2024

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