Epoxy resins

SAO PAULO (ICIS)–Brazil's chemicals industry is facing its worst performance in 30 years, with the producing companies in the sector operating at just 60% of installed capacity during January and February, the country’s trade group Abiquim said. According to the Abiquim-Fipe Economic Monitoring Report (RAC), all key indicators showed a decline in the two-month period, year on year: production fell by 5.6%, domestic sales dropped 0.8%, and national demand for industrial chemical products decreased by 4.0%. As domestic producers' market share diminishes, imports continue reaching Brazil’s shores at pace, with the country’s chemicals trade deficit continuing to increase. In the 12 months to February 2025, it reached $49.59 billion, up from $48.68 billion in the same 12-month comparable period a year prior. Imports now represent 49% of total domestic demand, with significant increases in thermoplastic resins (28.3%), other inorganic products (26.7%), and organic chemicals (25.1%). IDLENESSChemical plants’ 40% idleness average level in January-February was the worst recorded since data collection began in 1990, said the trade group, which represents mostly chemicals producers. Some product groups posted even higher idleness rates, such intermediates for fertilizers (44%), intermediates for plastics (48%), intermediates for synthetic fibers (41%), and intermediates for plasticizers (61%). February’s results were particularly concerning, with production plummeting 10.1% compared to January, domestic sales decreasing 4.5%, and national apparent consumption dropping 17.1%. Abiquim said companies attributed this poor performance to operational problems, idle units, plants in hibernation, low demand, raw material restrictions, electricity supply variations, and fewer operating days in February. Despite the clouds, prices for chemical products rose 5.1% between January and February 2025, with real prices increasing 3.6% when accounting for inflation. In dollar and euro terms, real prices are 11.3% and 11.2% higher, respectively, compared to 2024. Abiquim’s executive president, Andre Passos, preferred to see the glass half full – despite all evidence pointing to it being half empty – and said two state programs for the chemicals sector had the potential to turn things around by the end of this decade and “save” Brazilian chemicals. Passos said the breaks on some input materials, called REIQ, including provisions linking tax incentives to investments, was a re-implementation linked to investments to create new or expand existing capacities. Passos added that, only in 2025, companies could invest up to Brazilian reais (R) 1 billion thanks to the provisions included in the REIQ bill. ‘SAVE THE SECTOR’This week Abiquim focused on another bill, the Special Program for Sustainability of the Chemical Industry (Presiq). The Presiq acronym may be heard more often from now on if what Abiquim’s Passos said about it comes to pass – if implemented in full and correctly, Presiq could become the savior the struggling chemicals industry has for years been looking for. Earlier in April, Brazil’s parliament passed what could be considered the country’s response to the EU Green Deal or to the US IRA, now in danger of extinction: widespread tax incentives for companies going greener and embracing low-carbon processes and technologies. Presiq itself is an ambitious project which, beyond attracting more low-carbon investments, aims to bring the sector to near full capacity, targeting 95% utilization rates by the end of this decade. Presiq has two financial lines – one aimed at credits for the purchase of less polluting inputs and raw materials, such as natural gas versus other more polluting fossil fuels; secondly, the program will offer investment credits of up to 3% of invested value for petrochemical plants and chemical industries committed to expanding installed capacity. Starting in 2027, Presiq budgeted up to R4 billion for financial credits, and up to R1 billion for investment credits. “The Brazilian chemical sector is facing a delicate moment, aggravated by the trade war between the US and China. The government must take urgent measures to strengthen the national chemical industry, just as its international competitors have done with incentive programs,” said Passos. "The new law [Presiq] will help reduce the deficit in the chemical industry, and it could become an important source of revenue. It will also add value to the country through the sustainable use of natural resources. This plan can save the sector." Front page picture: Chemicals facilities in Brazil Source: Abiquim ($1 = R5.93)

16-Apr-2025

MUMBAI (ICIS)–India’s Deepak Chem Tech Ltd (DCTL) plans to set up a manufacturing complex to produce phenol, acetone and isopropyl alcohol (IPA) at a cost of Indian rupee (Rs) 35 billion ($407 million). The company will build a 300,000 tonne/year phenol unit, a 185,000 tonne/year acetone plant and a 100,000 tonne/year IPA line at Dahej in the western Gujarat state, its parent firm Deepak Nitrite Ltd (DNL) said in a statement to the Bombay Stock Exchange (BSE) on 9 April. It expects to fund the new project through a mix of debt and equity. DCTL is a wholly owned subsidiary of DNL. “The new capacity of phenol and acetone would be integrated to produce polycarbonate (PC) resins,” DNL said. In November 2024, DCTL announced plans to build a new 165,000 tonne/year PC plant in Dahej using technology from US-based engineering materials producer Trinseo. Trinseo sold its PC technology license, as well as all of its proprietary PC equipment at Stade, Germany to DCTL last year. DCTL expects to begin operations at all the new plants in the fiscal year ending March 2028. Once the plants are operational, DCTL “will be one of the most integrated producers of PC,” it said, adding that the complex will help Deepak to meet India's growing market demand for PC-based products. To make its Dahej complex fully integrated, DNL’s wholly owned subsidiary Deepak Phenolics Ltd (DPL) entered into a 15-year agreement with Petronet LNG for the procurement of 250,000 tonne/year of feedstock propylene and 11,000 tonnes/year of hydrogen in October 2024. DPL currently produces 330,000 tonnes/year of phenol, 200,000 tonnes/year of acetone and 80,000 tonnes/year of IPA at its production complex at Dahej. In March, Deepak Advanced Materials Limited (DAML), another wholly owned subsidiary of DNL, began operations at its PC compounds facility at Vadodara in the Gujarat state. This facility produces PC compounds for the electronic and mobility sectors. Separately, DCTL also plans to invest Rs2.20 billion to build a plant that will manufacture specialty fluorochemicals. DNL also plans to commission its greenfield 40,000 tonne/year methyl isobutyl ketone (MIBK) and 8000 tonne/year methyl isobutyl carbinol (MIBC) plants before September 2025. ($1 = Rs86.01)

11-Apr-2025

MUMBAI (ICIS)–India’s vinyl industry is entering a new era of accelerated growth and global relevance as it emerges as the single-largest contributor to global polyvinyl chloride (PVC) demand expansion, even as the broader chemical industry faces overcapacity and trade re-alignments. India leads global PVC demand growth through 2030 Rising imports, Chinese dominance raise trade and dumping concerns Domestic capacity, infrastructure push support long-term market expansion At the Vinyl India 2025 conference held in Mumbai, senior executives and market watchers outlined India’s evolving role in global petrochemical dynamics, particularly as its PVC consumption is projected to double by 2030, fueled by urbanization, infrastructure programs, and a burgeoning middle class. The south Asian country is set to become the world’s second-largest economy by 2050 based on analysts’ projections. Its economic rise is bringing the PVC industry into sharper focus as a key enabler of infrastructure transformation. “PVC is no longer just a material; it’s an infrastructure backbone,” said Unmesh Nayak, polymer chain president at Indian conglomerate Reliance Industries Ltd. From pipes, cables, and fittings to flooring and films, vinyl products are essential to India’s economic growth. STRUCTURAL SHIFT IN GLOBAL CHLOR-ALKALI MARKETS While India’s PVC demand outlook remains bullish, global chlor-alkali players are navigating complex shifts in supply-demand dynamics. A senior industry executive noted that caustic soda demand remains resilient due to its wide industrial use, while chlorine – which is primarily linked to PVC production – faces higher volatility and weaker margins. Following price spikes for caustic soda, chlorine and PVC in 2021–2022, new investments – particularly in Asia – have triggered capacity overbuild, with a long market expected through to 2029. This imbalance is expected to benefit PVC buyers but continue to strain global margins. Meanwhile, India’s energy imports, logistics costs, and new tariff structures are altering traditional trade flows. US Gulf Coast vinyl exports face mounting challenges, even as India steps up to absorb rising global supply. PVC TRADE FLOWS REBALANCE AMID GLOBAL GLUT According to market experts, the global PVC market is set to grow by 16 million tonnes by 2034, a near one-third increase from 2024 levels. However, the center of gravity is shifting. While China remains the largest demand driver, its role in capacity additions is waning. India, southeast Asia, and the Middle East are rising as new hubs. India is expected to post the highest compounded annual growth rate (CAGR) in PVC demand globally, backed by growth in construction, water management, and mobility. However, trade imbalances are creating new risks. Chinese producers are increasingly exporting PVC in the form of finished goods – films, rods, sticks – nearly doubling exports to India since 2019. Today, 95% of India’s PVC product imports come from China, raising concerns over the health of the domestic downstream industry. “China is exporting its overcapacity through products, not resin,” noted the industry analyst. “This is easing domestic supply pressures in China but creating dependency risks for India.” INDIA STRUCTURAL DEMAND OUTLOOK REMAINS ROBUST Despite global headwinds, India’s structural story remains intact. Tricon Energy president & CEO Ignacio Torras outlined how China’s chemical capacity has outpaced demand, with nearly 20% of its PVC capacity idle due to a real estate slowdown. In stark contrast, India’s PVC consumption is on a steep upward curve. “India has electrified every corner, internet access has reached 70% of the population, and 150 million more people will join the middle class within five years,” he said. “These trends will directly translate to PVC demand.” India’s per capita PVC use is expected to rise from 2.6 to 5.0 kilogram (kg) by 2030, still well below China’s 16 kg – indicating significant headroom for growth. Even amid margin pressure, as tracked by Tricon’s internal index, the executive maintained that India offers scale, resilience, and long-term opportunity. GROWTH BUT NOT WITHOUT CHALLENGES While the outlook is positive, challenges loom. Stakeholders repeatedly highlighted the need for: Tariff safeguards to prevent dumping of cheap PVC and derivatives Investment in downstream manufacturing to reduce reliance on finished product imports Policy and institutional reforms to support rapid infrastructure rollout Circularity and ESG (environment, social, governance) compliance, as sustainability becomes central to investment decisions The National Infrastructure Pipeline (NIP) and other public sector initiatives are playing a catalytic role, but speakers emphasized that regulatory consistency and private-public coordination will be key to unlocking India’s full vinyl potential. As the global industry braces for a prolonged phase of overcapacity and price volatility, India offers a unique growth engine – one that could reshape demand dynamics in both resin and downstream vinyl markets. Insight article by Aswin Kondapally Visit the ICIS Topic Page: US tariffs, policy – impact on chemicals and energy.

11-Apr-2025

MUMBAI (ICIS)–India’s vinyl industry leaders voiced optimism about long-term demand growth while raising caution over rising imports and the need for a stable regulatory framework at the 12th Vinyl India Summit held in Mumbai on April 10-11, 2025. The conference brought together domestic producers, global suppliers, and policymakers to chart the future course of one of the fastest-growing vinyl markets in the world. India’s per capita polyvinyl chloride (PVC) consumption remains significantly below global averages, but growth momentum is building rapidly, said Vivek Jain, managing director of DCW Ltd., in his keynote address. Jain projected PVC demand to reach 7 million tonnes by FY2030, growing at a compound annual growth rate (CAGR) of 7.7%, underpinned by robust infrastructure expansion and broadening end-use applications. “PVC and CPVC are finding increased traction in plumbing, fire safety, and commercial construction,” Jain noted, adding that India’s policy environment must continue to support domestic manufacturing to sustain this trajectory. IMPORT SURGE RAISES TRADE CONCERNS While demand prospects are upbeat, rising imports remain a pressing concern for Indian producers. India imported 1.9 million tonnes of PVC in financial year (FY) 2022-23 (April to March), a figure that is expected to surge to 3 million tonnes by FY25, with China accounting for 43% of the inflows, Jain said. Ongoing global tariff disputes and surplus capacities in major exporting countries could make India vulnerable to dumping, he warned, strengthening the case for a re-evaluation of anti-dumping duties (ADDs). “Without adequate trade safeguards, India risks becoming a dumping ground,” he said. “Strategic and timely regulatory action is vital.” GOVERNMENT PROGRAMS DRIVING DOMESTIC DEMANDEchoing the bullish sentiment, Anil Jain, vice chairman and CEO of Jain Irrigation Systems Ltd., pointed to major infrastructure initiatives as the cornerstone of future demand. “With the Jal Jeevan Mission, river-linking projects, and aggressive rural irrigation programs, we are seeing a once-in-a-generation opportunity for PVC applications in water management,” Jain said. He highlighted that India aims to bring 10–20 million hectares of farmland under irrigation, a move that will significantly boost rural infrastructure and drive multi-decade demand for PVC. Jain also emphasized the expansion of chlorinated PVC (CPVC) beyond premium housing into affordable housing, powered by government plans to build 100 million new homes. MARKET OPTIMISM ROOTED IN DOMESTIC RESILIENCEDespite global economic volatility, both executives underscored India’s internal strength as a consumption-driven economy. “India’s growth story is being written at home. Domestic demand is strong, and if PVC price stays around $700/tonne, we’ll remain the fastest-growing market globally,” Anil Jain stated. New resin capacities coming online by 2026–27, combined with a policy environment that encourages investment, are expected to propel India’s PVC sector through what Jain described as a “rocking five years” ahead. The conference also emphasized the importance of ESG compliance, green material innovation, and the circular economy as integral to sustainable growth. “Growth and environmental responsibility must go hand in hand,” Vivek Jain concluded, urging stakeholders to collaborate on a long-term roadmap to 2030. Focus article by Aswin Kondapally

11-Apr-2025

SAO PAULO (ICIS)–Here are some of the stories from ICIS Latin America for the week ended on 4 April. NEWSMexico’s chemicals breathe sigh of relief on US tariffs; Brazil’s industry urges for dialogueMexican chemicals sources were relieved on Thursday to see their country spared from the most punitive US tariff rates, but challenges related to the tariffs on automotive and auto parts remain. Brazil opens antidumping investigation on PET imports from Malaysia and VietnamBrazil’s Department of Trade Defense (DECOM) has launched an investigation into the alleged dumping of polyethylene terephthalate (PET) resin imports from Malaysia and Vietnam, according to the Ministry of Development, Industry, Trade and Services. INSIGHT: Brazil’s chems producers lobby to expand protectionism as economic issues growBrazil’s chemicals producers represented by Abiquim have already started lobbying the cabinet to keep “or even expand” the higher tariffs on chemicals products implemented in October, initially for a 12-month period. US should focus on era-defining China vs North America dichotomy – Braskem Idesa execUS import tariffs on Mexico and Canada risk weakening the much-integrated North American trade bloc allowing China to strengthen its formidable rise, according to an executive at Mexico’s polyethylene (PE) producer Braskem Idesa. Argentina's economy firmly on the mend but exchange rate concerns cloud outlook – economistArgentina's economy has emerged from "intensive care" but remains in hospital as the country turned from the brink of hyperinflation and default in December 2023 to its current state of fragile stability, according to an economist at Buenos Aires-based consultancy Fundacion Capital. Mexico’s manufacturing slumps on tariffs woes, sentiment plummets amid ‘bleak’ outlookMexico's manufacturing sector deteriorated at its fastest pace since January 2022 as tariff announcements drove sharp declines in sales and production during March, according to S&P Global. Argentina’s chemicals expectant on US tariff deal, IMF bailout as Milei arrives in WashingtonPetrochemicals sources in Argentina were expectant about President Javier Milei’s trip to the US started on Friday and whether he can return home with a deal with Donald Trump’s administration to lower import tariffs on Argentina. PRICING LatAm PP domestic prices fall on lower feedstock costs, cheaper importsDomestic polypropylene (PP) prices fell across Latin American (LatAm) countries on lower feedstock costs and cheaper imports. LatAm PE international prices steady to lower on cheaper US export offersInternational polyethylene (PE) prices were assessed as steady to lower across Latin American (LatAm) countries on the back of cheaper US export offers.

07-Apr-2025

SAN ANTONIO (ICIS)–Uncertainty about the US economy is delaying what could be a further rebound in housing activity, the CEO of Huntsman said. "It's not that we are seeing seasonal demand recovering. We are," said Peter Huntsman, CEO of Huntsman. He made his comments in an interview with ICIS on the sidelines of the International Petrochemical Conference (IPC), held by the American Fuel & Petrochemical Manufacturers (AFPM). But a larger recovery will require more certainty, he said. Consumers will be more reluctant to buy a house during volatility in the stock market. Possible tariffs and changes in the outlook for monetary policy are also contributing to the uncertainty. Additional uncertainty surrounds mortgage rates. Although rates for 30-year home loans have declined from earlier in the year, they are still well above levels seen in the previous decade. Some may be delaying purchases in the hope that mortgage rates return to those lower levels. Meanwhile, existing homeowners who bought their houses with low-interest mortgages are reluctant to sell because they will have to finance their purchase with a loan bearing a much higher rate. Overall, uncertainty will delay a further rebound in housing activity, Huntsman said. "I think we're going to see a late start." That said, the conditions exist for a housing recovery. Huntsman said the US has a large backlog in housing because of population growth and years of under-construction. New housing is a key end-use market for chemistry in the form of paints, wire insulation, house-wrap, sealants, roofing materials, resilient flooring, vinyl siding, and related products. New housing also generates sales of appliances, furniture, carpet, fixtures, and window treatments. In total, each start engenders on average over $13,000 worth of chemistry. Existing home sales generate sales of chemistry through purchases of paints and coatings, new furniture, carpet, resilient flooring, window treatments, appliances, and fixtures. In architectural coatings, about 80% of sales are tied to existing home sales. Huntsman makes polyurethanes, epoxy resins and maleic anhydride (MA), a key feedstock in unsaturated polyester resins (UPR). Hosted by the American Fuel & Petrochemical Manufacturers (AFPM), the IPC takes place on 23-25 March in San Antonio, Texas. Interview article by Al Greenwood Thumbnail photo source: Shutterstock Visit the US tariffs, policy – impact on chemicals and energy topic page Visit the Macroeconomics: Impact on chemicals topic page Visit the Logistics: Impact on chemicals and energy topic page

25-Mar-2025

SINGAPORE (ICIS)–Here are the top stories from ICIS News Asia and the Middle East for the week ended 21 March. Bearish sentiment prevails in Asia petrochemicals amid oversupply By Jonathan Yee 17-Mar-25 14:39 SINGAPORE (ICIS)–Weak downstream demand, exacerbated by economic and geopolitical uncertainties, keeps sentiment bearish and buyers cautious across petrochemical markets in Asia. China unveils consumption stimulus to safeguard growth By Fanny Zhang 17-Mar-25 16:00 SINGAPORE (ICIS)–China’s State Council announced on Sunday a special action plan to boost consumption, in fresh efforts to help achieve its growth target of around 5% for 2025. Monthly price gaps between Asia rPET, PET remain wide in Q1 By Arianne Perez 17-Mar-25 17:07 SINGAPORE (ICIS)–Average monthly spot prices between bottle-grade recycled polyethylene terephthalate (rPET) and polyethylene terephthalate (PET) pellets were persistently wide amid various factors in the Asian markets. Asia methanol in flux as Iran capacities expected to come onstream By Damini Dabholkar 17-Mar-25 17:26 SINGAPORE (ICIS)–The Asian methanol market has seen some price uncertainty over the last few weeks, with several market participants closely watching developments related to the start-up of methanol plants in Iran. INSIGHT: Asia chemical prices to soften in March amid crude oil losses – ICIS By Ann Sun 18-Mar-25 13:03 SINGAPORE (ICIS)–Asia’s petrochemical prices in March are expected soften due to downward pressure from crude oil losses. This forecast is driven by bearish sentiment caused by concerns over OPEC and its allies’ (OPEC+) planned output increase and the US’ trade policies. China remains net SM importer in 2024, setting stage for active exports in 2025 By Luffy Wu 18-Mar-25 16:04 SINGAPORE (ICIS)–Despite market players' rising focus on China's styrene monomer (SM) export market, the country remained a net SM importer in 2024 with an annual SM trade deficit of 159,719 tonnes. INSIGHT: China PET resin production growth to decelerate in 2025 By Jimmy Zhang 18-Mar-25 17:30 SINGAPORE (ICIS)–On an annual basis, China PET resin (mainly bottle grade) production growth remained quite high in both 2023 and 2024, at around 10% and 15% respectively. ICIS China February petrochemical index dips; March demand soft By Yvonne Shi 19-Mar-25 12:13 SINGAPORE (ICIS)–China’s domestic petrochemical prices weakened in February amid a sluggish market, with downstream factories slow to resume operations after the Lunar New Year holiday. PODCAST: Volatility seen in Asia, Mideast isocyanates amid recent supply changes By Damini Dabholkar 19-Mar-25 13:25 SINGAPORE (ICIS)–Asia and Mideast isocyanates prices climbed rapidly immediately after the Lunar New Year holiday, followed by sharp corrections in mid to end-February. Indonesia central bank keeps policy interest rate at 5.75% after market rout By Nurluqman Suratman 19-Mar-25 17:38 SINGAPORE (ICIS)–Indonesia’s central bank kept its policy rate unchanged at 5.75% on Wednesday, a day after local stocks closed nearly 4% lower, on concerns over the country’s economic growth prospects and government finances. Arbitrage widens for Asia-Europe acetic acid, etac spot trades By Hwee Hwee Tan 20-Mar-25 13:03 SINGAPORE (ICIS)–Traders leveraging on easing freight rates and a stronger euro have fixed several spot cargoes for acetyl products bound for Europe from China, lifting Asia-Atlantic trade volume into March. INSIGHT: Persistent capro oversupply sees plant closures, consolidation in Asia By Isaac Tan 20-Mar-25 14:00 SINGAPORE (ICIS)–The global caprolactam (capro) market is grappling with significant challenges, as oversupply from expanding Chinese production capacities, weak downstream demand, and rising margin pressures combine to create a pessimistic outlook for producers worldwide. Vopak's €1bn investments in energy transition projects underway – exec By Jonathan Yee 20-Mar-25 15:49 SINGAPORE (ICIS)–Dutch storage and infrastructure firm Vopak is doubling down on its energy transition strategy, re-affirming its commitment to invest €1 billion in low-carbon infrastructure through to 2030, the company’s Asia and Middle East chief told ICIS. Japan Feb core inflation at 3.0%; upholds interest rate hike hopes By Nurluqman Suratman 21-Mar-25 12:18 SINGAPORE (ICIS)–Japan's core consumer prices excluding fresh food in February rose by 3% year on year, remaining above the central bank's 2% target, reinforcing market expectations of further interest rate hikes this year. PODCAST: A tale of two olefins; C2, C3 to see diverging demand trends By Damini Dabholkar 21-Mar-25 13:32 SINGAPORE (ICIS)–Asia propylene (C3) editor Julia Tan speaks with Asia ethylene (C2) editor Josh Quah about the impact of recent tariff wars on downstream market sentiment, along with the markets' outlook for the second quarter.

24-Mar-2025

SAN ANTONIO (ICIS)–Here is a summary of chemical market stories, heading into this year’s International Petrochemical Conference (IPC). Hosted by the American Fuel & Petrochemical Manufacturers (AFPM), the IPC takes place on 23-25 March in San Antonio, Texas. AFPM ‘25: US tariffs, retaliation risk heightens uncertainty for chemicals, economies The threat of additional US tariffs, retaliatory tariffs from trading partners, and their potential impact is fostering a heightened level of uncertainty, dampening consumer, business and investor sentiment, along with clouding the 2025 outlook for chemicals and economies. AFPM '25: New US president brings chems regulatory relief, tariffs The new administration of US President Donald Trump is giving chemical companies a break on regulations and proposing tariffs on the nation's biggest trade partners and on the world. AFPM ’25: Shippers weigh tariffs, port charges on global supply chains Whether it is dealing with on-again, off-again tariffs, new charges at US ports for carriers with China-flagged vessels in their fleets, or booking passage through the Panama Canal, participants at this year's IPC have plenty to talk about. AFPM ’25: LatAm chemicals face uncertain outlook amid oversupply, trade policy woes Latin American petrochemicals face ongoing challenges from oversupplied markets and poor demand, with survival increasingly dependent on government protectionist measures. AFPM ’25: US propane supply long; ethane prices rising The US petrochemical industry is seeing a glut of upstream propane supply and rising prices for key feedstock ethane. AFPM ’25: Weak demand takes toll on US ethylene as supply concerns ease Persistently poor demand, underpinned by worries over global tariff policies and a sluggish US economy are putting downward pressure on US ethylene prices. AFPM ’25: US propylene demand weak despite recent supply disruptions Weak demand in the US propylene market has counterbalanced recent supply disruptions, pushing spot prices and sentiment lower. AFPM ’25: US BD supply lengthening; rubber demand optimistic US butadiene (BD) has been rather balanced in Q1 despite a couple of planned turnarounds and cracker outages limiting crude C4 deliveries, but supply is expected to lengthen, and demand is cautiously optimistic. AFPM ’25: US aromatics supply ample amid low demand Domestic supply of aromatics is ample and demand is relatively poor. AFPM ’25: US methanol exports, bunker fuel demand to grow, but domestic demand sentiment low US methanol participants’ outlook on the key downstream construction and automotive sectors has dimmed, but optimism continues for export growth and bunker fuel demand. AFPM ’25: Tariffs, weak demand weigh on US base oils Uncertain US trade policy paired with already weak finished lubricant demand weighs on base oil market sentiment. AFPM ’25: Trade policies dampening outlook for Americas PE The US polyethylene (PE) industry started 2025 with some early successes amid the backdrop of lower year-on-year GDP growth. Now, with the impact of volatile tariff policy on top of the aforementioned lower GDP forecast, the outlook for PE has fallen. AFPM '25: Tariffs to shape the trajectory of caustic soda in US and beyond The North American caustic soda market is facing continued headwinds coming via potential tariffs, a challenged PVC market and planned and unplanned outages. US President Donald Trump has threatened to implement tariffs on Mexico, Canada and the EU as well as on products that are directly tied to caustic soda but has delayed enactment on multiple occasions. These delays have bred uncertainty in the near-term outlook, impacting markets in the US and beyond. AFPM '25: US PVC to face headwinds from tariffs, economy The US polyvinyl chloride (PVC) market is facing continued headwinds as tariff-related uncertainties persist. The domestic PVC market is expected to grow between 1-3% in 2025 but continues to face challenges in housing and construction. Meanwhile, export markets continue to wrestle with the threat of protectionist policies and tariffs at home and abroad. AFPM ’25: US spot EG supply balanced-to-tight on heavy turnaround season; EO balanced Supply in the US ethylene glycols (EG) market is balanced-to-tight as the market is undergoing a heavy turnaround season. The US ethylene oxide (EO) market is balanced as demand from derivatives including surfactants is flat. AFPM ’25: US PET prices facing upward price pressure on tariffs, China’s antimony exports ban, peak seasonUS polyethylene terephthalate (PET) prices continue to face volatility as the market assesses the impacts of potential tariffs on imports from Canada and Mexico. AFPM ’25: US PP volatility persists amid weak demand The US polypropylene (PP) market is facing weak demand, raw material volatility and tariff uncertainty. AFPM ’25: US ACN rationalization inevitable amid declining demand Production of acrylonitrile (ACN) in the US is being reduced or shuttered as already weak demand continues to fall and as downstream plants are shutting down. Changes to the supply/demand balance, trade flows and tariff uncertainties are weighing on market participants. AFPM ’25: US nylon trade flows shifting amid global capacity changes, tariff uncertainties US nylon imports and exports are changing as capacity becomes regionalized and geographically realigned. The subsequent changes to trade flows, price increase initiatives and tariff uncertainties are weighing on market participants. AFPM ’25: US ABS, PC face headwinds from closure and oversupply The US acrylonitrile butadiene styrene (ABS) and polycarbonate (PC) markets are lackluster and oversupplied. Demand remains soft kicking off the year, and the closure of INEOS’s Addyston, Ohio, ABS facility and tariff uncertainties continue to pressure ABS and PC markets. AFPM ’25: US styrene market facing oversupply amid weak demand, trade uncertainty The US styrene market is transitioning from a period of supply tightness to one of potential oversupply, driven by weak derivative demand and the recent restart of Styrolution’s Bayport, Texas, unit. This return to full operation, coupled with subdued demand, suggests ample supply in the short term. AFPM ’25: US PS faces slow start to 2025 amid weak demand Domestic polystyrene (PS) demand started the year off weaker than expected, with limited restocking and slower markets. AFPM ’25: US phenol/acetone face challenging outlook heading into Q2 US phenol and acetone are grappling with a lot of moving pieces. AFPM ’25: US MMA facing new supply amid volatile demand heading into Q2 US methyl methacrylate (MMA) is facing evolving supply-and-demand dynamics. Roehm's new plant in Bay City, Texas, is in the final stage of start-up, but is not in operation yet. There is anticipation of sample product being available in Q2 for qualification purposes. AFPM ’25: US epoxy resins in flux amid duties, tariffs heading into Q2 US epoxy resins is grappling with changes in duties and trade policies. AFPM ’25: Acetic acid, VAM eyes impact of tariffs on demand, outages on supply The US acetic acid and vinyl acetate monomer (VAM) markets are waiting to see what impact shifting trade and tariff policy will have on domestic and export demand, while disruptions are beginning to tighten VAM supply. AFPM '25: US etac, butac, glycol ethers markets focus on upcoming paints, coatings demand US ethyl acetate (etac), butyl acetate (butac) and glycol ethers market participants are waiting to see if the upcoming paints and coatings season will reinvigorate demand that has been in a long-term slump. AFPM ’25: Low demand for US oxos, acrylates, plasticizers countering feedstock cost spikes US propylene derivatives oxo alcohols, acrylic acid, acrylate esters and plasticizers have been partly insulated from upstream costs spikes by low demand, focusing outlooks on volatile supply and uncertain demand. AFPM ’25: N Am expectations for H2 TiO2 demand rebound paused amid tariff implementations After initial expectations of stronger demand for titanium dioxide (TiO2) in the latter half of 2025, the North American market is now in flux following escalating tariff talks. AFPM ’25: US IPA, MEK markets look to supplies, upstream costs US isopropanol (IPA) market has an eye on costs as upstream propylene supplies are volatile, while the US methyl ethyl ketone (MEK) market is evaluating the impact of global capacity reductions. AFPM ’25: US melamine prices continue to face upward pressure on duties, tight supply US melamine is experiencing upward pricing pressure, thanks in large part to antidumping and countervailing duty sanctions and tight domestic supply. AFPM '25: US polyurethane industry braces for cascade effect of tariffs US polyurethane prices for toluene diisocyanate (TDI), methylene diphenyl diisocyanate (MDI) and a variety of polyether and polyester polyols continue to see increase pressure as the market assesses the impacts of potential tariffs on imports from Canada and Mexico. AFPM ’25: US BDO market eyes costs, demand outlook uncertain US 1,4 butanediol (BDO) production costs have been mounting, and margins have been crunched. Supply is ample and demand has been lackluster. AFPM ’25: US propylene glycol demand begins softening after prior feedstock-driven uptick After a cold winter with strong demand for seasonal propylene glycol (PG) end-uses in antifreeze and de-icers in many parts of the US, demand is starting to cool. AFPM ’25: US MA sentiment cautious ahead of potentially volatile Q2 US maleic anhydride (MA) is facing a volatile economic backdrop. Spot feedstock normal butane has fallen below $1/gal in March due to the end of peak blending season and strong production. AFPM ’25: US PA, OX face trade uncertainty, production constraints US phthalic anhydride (PA) and orthoxylene (OX) demand remains relatively weak. Prices have been remaining flat and are expected to settle lower this month after losing mixed xylene (MX) price support and underlying crude oil price declines. AFPM '25: Tight feedstock availability to keep US fatty acids, alcohols firm despite demand woes Tight supplies and high prices for oleochemical feedstocks are expected to keep US oleochemicals prices relatively firm, as continued macroeconomic headwinds, including escalating trade tensions between the US and other countries, only further weigh on consumer sentiment and discourage players from taking long-term positions. AFPM '25: Historic drop in biodiesel production to keep US glycerine relatively firm A drop in US biodiesel production to levels not seen since Q1 2017 is likely to keep the floor on US glycerine prices relatively firm through at least H1 as imports of both crude and refined material fail to fully offset the short-term shortfalls in domestic supply. PRC ’25: US R-PET demand to fall short of 2025 expectations, but still see slow growth As the landmark year, 2025, swiftly passes, many within the US recycled polyethylene terephthalate (R-PET) industry doubt the demand and market growth promised by voluntary brand goals and regulatory post-consumer recycled (PCR) content minimums will come to fruition. PRC ’25: US pyrolysis recycling players churning through regulatory, economic uncertainty As both regulatory and economic landscapes continue to change, production and commercialization progress among pyrolysis based plastic recyclers continues to be mixed. Pyrolysis, a thermal depolymerization/conversion technology which targets polyolefin-heavy mixed plastic waste, or tires, is expected to become the dominant form of chemical recycling over the next decade. Visit the US tariffs, policy – impact on chemicals and energy topic page Visit the Macroeconomics: Impact on chemicals topic page Visit the Logistics: Impact on chemicals and energy topic page Visit the Recycled Plastics topic page

22-Mar-2025

SINGAPORE (ICIS)–Click here to see the latest blog post on Asian Chemical Connections by John Richardson. At the end of 2024, Beijing ditched “prudent” for “moderately loose” monetary policy—raising hopes of a growth reboot. But I warned: deep structural issues and growing global trade tensions would blunt any gains. Now, three months on, the most sweeping consumer stimulus in 31 years has landed. Key measures include: Budget deficit raised to 4% of GDP (31-year high) 13% increase in local government borrowing 30% increase in long-term bonds to fund consumer trade-ins RMB 500bn ($70bn) injection into state-owned banks Wage increases, childcare subsidies, rural income support Expansion of social benefits Backing for AI and emerging sectors Sounds bold—but deep-rooted problems persist: Housing wealth down ¥25tn ($3.4tn) Youth unemployment above 10% CPI fell 0.7% in Feb; PPI deflation for 29 consecutive months Consumption grew just ~5% in 2024 (vs ~8% pre-pandemic average) As Michael Pettis notes, China would need: Higher wages (hurts exports) Higher taxes (hurts investment) Stronger RMB (hurts trade) To hit the 6–7% consumption growth needed for 4–5% GDP. Then there’s demographics: Population may fall to 1.1bn by 2050, under 400m by 2100 Fertility rate: 0.8 Some estimates say 2020 population was 130m lower than reported And rising trade protectionism: China accounts for 40% of global resins demand Dominates 600+ global export categories Trade surpluses with EU, Japan, and rest of Asia are swelling Retaliation and reshoring are accelerating On AI: Stock market rally, but under 20% of adults own shares Investment is concentrated; automation risks job loss Consumer sentiment remains cautious PE Spread & Margin Reality Check: Jan–Feb 2025 average PE spread: $294/tonne Post-NPC average (to 14 March): $300/tonne Supercycle average (1993–2021): $532/tonne NEA PE margin since 2022: $7/tonne (vs $462/tonne during Supercycle) Conclusion: Short-term rally? Maybe. Long-term recovery? Not without deep reform. Weak consumption Property slump Demographic drag Trade backlash Let’s see how spreads and margins evolve over the next 12–18 months. 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.

21-Mar-2025

HOUSTON (ICIS)–As both regulatory and economic landscapes continue to change, production and commercialization progress among pyrolysis based plastic recyclers continues to be mixed heading into this year’s Plastics Recycling Conference (PRC). Pyrolysis, a thermal depolymerization/conversion technology which targets polyolefin-heavy mixed plastic waste, or tires, is expected to become the dominant form of chemical recycling over the next decade. This comes at a time when sought after food grade, natural colored mechanically recycled polyethylene (R-PE) and recycled polypropylene (R-PP) resins continue to be in tight supply and chemically recycled resin could help to close the gap. However, all types of recycled resin face rising premiums compared to softening virgin markets. REGULATION: FEDERAL AND STATEChemical recycling technologies, such as pyrolysis, have previously been under scrutiny at the federal level through Environmental Protection Agency (EPA) regulation. The latest 2023 stance, officials asked for more time to review the full life cycle and environmental impact of chemical recycling facilities before deregulating permit processes. Counter to this stance and while not explicitly stated, it is assumed the Trump administration would likely be supportive of chemical recycling, due to the underlying petrochemical industry involvement and pro-business fundamentals. At a state level, 25 states have passed bills classifying chemical recycling technologies as recycling technologies rather than waste management processes. This potentially opens the door for pyrolysis facilities in those states to qualify for state grants and tax incentives that are available to manufacturing operations as well as supports the case for recycled resin from chemical recycling processes to count towards post-consumer recycled (PCR) content minimums. However, there is a catch: among the states that have accepted chemical recycling, there are a few states that explicitly exclude certain processes. For example, states such as Kentucky and Kansas are among those that exclude processes that turn plastic to fuel. One example of this can be seen in the State of Kentucky’s HB 45, which notes, "Advanced recycling does not include energy recovery or the conversion of post-use polymers into fuel." Similar language can be found in the State of Kansas’ SB 114, "Advanced recycling does not include incineration of plastics or waste-to-energy processes, and products sold as fuel are not recycled products." In these specific situations, pyrolysis may still not be counted as a form of recycling. Similarly, there are several states which have passed or proposed passing laws which prohibit processes such as pyrolysis to count as recycling. PYROLYSIS HURDLES FROM PCR/EPR MANDATESStates with plastic recycled content requirements have mixed views on acceptance of recycled content from chemical recycling, including pyrolysis. Currently, five states – California, Maine, Connecticut, Washington and New Jersey – have passed PCR laws, through of which are currently active. However, none of these states are among the 25 mentioned above that have formally accepted chemical recycling into legislation. This fact means that it is often unclear if outputs from chemical recycling are ineligible to count toward PCR requirements, undermining the industry’s potential impact and growth. In some cases, clarity is brought informally through "Frequently Asked Questions (FAQ)" documents, such as in New Jersey. A notable exception exists in Washington, where its PCR law explicitly states: “Both mechanical and chemical recycling methods are acceptable.” This language demonstrates a more inclusive approach, contrasting with states like California and Maine, which remain cautious about embracing chemical recycling. This mirrors uncertainty in extended producer responsibility (EPR) policies which are currently implemented on a state-by-state basis. At present, five states have passed plastic packaging related EPR – Oregon, Colorado, California, Minnesota and Maine. However, the relationship between EPR and chemical recycling remains complex. A key issue lies in how EPR laws define acceptable “end markets” for collected plastics. Oregon’s definition of responsible end markets appears tailored to traditional mechanical recycling, inadvertently excluding many chemical recycling technologies. This exclusion stems from the varied outputs of chemical recycling, which can range from plastics to fuels or chemical precursors, complicating their classification as traditional recycling. Pyrolysis is one of the recycling processes that produce multiple outputs, meaning that it will likely suffer from this definition. INVESTMENT, PROGRESS MIRRORS FRAGMENTATIONAs a result of these legislative hurdles, as well as financial burdens, lack of commercial success in the face of premiums, and public pushback on the environmental consequences of these processes, there have been project cancellations for chemical recycling in 2024. Two notable pyrolysis cancellations are Regenyx and Encina. Announced this week, another US pyrolysis player, Brightmark, has filed for chapter 11 bankruptcy, thus placing their existing Ashley, Indiana plant in jeopardy, though with the hope that both existing and planned facilities will be able to continue operations in the future. Per the bankruptcy filing, the Ashley facility, with an installed capacity of 100,000 tonnes, had been operating at less than 5% capacity. Progress on the Thomaston, Georgia facility announced last year is on going. Brightmark had previously cancelled plans for a separate Georgia facility. Moreover, several facilities continue to see operational challenges and are also heard to be producing a minimal amount of material. Despite these setbacks, pyrolysis is projected to have the most growth based on announced plants. According to data gather from the ICIS Chemical Recycling Supply Tracker – which tracks these facility announcements – the chemical recycling capacity could potentially grow 10 times by 2030, with a majority of that growth expected to come from pyrolysis. Reasons for this include synergies with mechanical recycling by targeting different feedstock and the ability to handle a wider range of feedstock, reducing the degree of sorting needed. Notable expected facilities include ExxonMobil's expansion plans, Braven Environmental's recently announced plans, and LyondellBasell's future plans for the Houston refinery. The chemical recycling industry is nascent as well as controversial. As such, there is a considerable amount of both optimism and challenges. Despite all of the challenges on the horizon, the chemical recycling industry and pyrolysis continue to push forward. Hosted by Resource Recycling Inc, the PRC takes place on 24-26 March in National Harbor, Maryland. ICIS will be presenting "Shaping the Future of Recycled Plastics: Trends and Forecasts" on Monday, March 24th at 11:15AM in room Potomac D. As well as attending our session, we would love to connect with you at the show- please stop by our booth, #308. Visit the US tariffs, policy – impact on chemicals and energy topic page Visit the Macroeconomics: Impact on chemicals topic page Visit the Logistics: Impact on chemicals and energy topic page Focus article by Joshua Dill Additional reporting by Emily Friedman

20-Mar-2025