Glycol ethers

LONDON (ICIS)–Here are some of the top stories from ICIS Europe for the week ended 17 April. Europe PE endures week of tariff chaos, emerges with softer outlookThe European polyethylene (PE) market has suffered a week of tariff-based turmoil, which resulted in a significant shift in market sentiment. Low river Rhine severely restricts chemical shipping, rates riseDry weather conditions are starving the river Rhine of water, restricting its use for chemicals traffic and pushing up shipping rates, with no improvement forecast until later in April. Europe MPG players say seasonal improvement unlikelyEuropean monopropylene glycol (MPG) sellers do not see any respite from tough market conditions as the construction sector is struggling, arbitrage with Asia is wide and US tariffs are creating uncertainties through the value chain. INSIGHT: Europe chems players move to the side lines on tariff upheavalThe market volatility following the intensification of tariff threats has cast a pall over European chemicals sector activity, with players avoiding committing to long-term orders if possible in the face of demand uncertainty and currency volatility.

21-Apr-2025

HOUSTON (ICIS)–Rates for shipping containers from east Asia and China to the US reversed direction and edged slightly higher this week as US tariffs went into effect and as capacity tightened. The increases are in line with global average rates, which ticked higher by 3% this week, according to supply chain advisors Drewry and as shown in the following chart. Rates from Shanghai to Los Angeles rose by 3% and rates from Shanghai to New York rose by 2%, as shown in the following chart. Drewry expects rates to increase in the coming weeks due to tariffs and reduced capacity. Rates from online freight shipping marketplace and platform provider Freightos also rose over the week, with Asia-USWC rates up by 3% and Asia-USEC rates up by 5%. Judah Levine, head of research at Freightos, said many shippers rushed to get cargo loaded in the small window before tariffs went into effect, but noted that there are concerns that the sudden policy changes could also mean delays at US customs for arriving shipments. Levine said he expects to see a drop in demand for containers into the US as shippers wait for the situation to stabilize. Peter Sand, chief analyst at ocean and freight rate analytics firm Xeneta, said global maritime supply chains have become more complex amid the trade war between the US and China. “Shippers will be monitoring freight costs across the major and secondary trades,” Sand said. “Japan, for example, is one the key trade partners with the US, so a rush to frontload goods could put upward pressure on spot rates on this trade.” Container ships and costs for shipping containers are relevant to the chemical industry because while most chemicals are liquids and are shipped in tankers, container ships transport polymers, such as polyethylene (PE) and polypropylene (PP), are shipped in pellets. Titanium dioxide (TiO2) is also shipped in containers. They also transport liquid chemicals in isotanks. LIQUID TANKER RATES HOLD STEADY US liquid chemical tanker freight rates as assessed by ICIS held steady this week despite downward pressure for several trade lanes. There is downward pressure on rates along the USG-Asia trade lane as charterers are seeking to divert cargoes to other regions. Overall, most market participants continue to struggle with tariff uncertainties and other alternatives. As a result of the limited cargo activity, spot rates appear to be softening. However, methanol requirements from the region remain active to Asia. Similarly, rates from the USG to Rotterdam were steady this week, even as space among the regular carriers remains limited. However, several larger size cargos of caustic soda, methanol, MTBE, ethanol and styrene were seen in the market. Several outsiders have come on berth for both April and May, adding to the available tonnage for completion cargos. Easing demand for clean tankers has attracted those vessels to enter the chemical sector. Contract tonnage continues to prevail, with interest in styrene, methyl tertiary butyl ether (MTBE), methanol and ethanol. For the USG to South America trade lane, rates remain steady with a few inquiries for methanol and ethanol widely viewed in the market. Overall, the market was relatively quiet with fewer COA nominations, putting downward pressure on rates as more space has become available. On the bunker side, fuel prices have declined as well, on the back of plummeting energy prices, as a result week over week were softer. Additional reporting by Kevin Callahan Thumbnail image shows a stack of shipping containers. Image by Shutterstock

11-Apr-2025

NEW YORK (ICIS)–It is now a full-blown trade war between the US and China with the launch of massive salvos of tariffs and retaliatory tariffs, far exceeding levels during the first US-China trade war which started in 2018. Trade flows are set to be disrupted in a big way, resulting in a seismic shift in the global chemical industry. The US implemented additional 84% tariffs on imports from China on 9 April – a 34% reciprocal tariff announced on 2 April, and another 50% in response to China’s initial planned retaliation of 34% tariffs on imports from the US. With the earlier 20% tariffs on China implemented in February (+10%) and March (+10%), the additional US tariffs on imports from China jump to 104%. The US escalation against China brings the US effective tariff rate to 29.4%, the highest level since 1890 during the McKinley administration, pointed out Kevin Swift, ICIS senior economist. Since 2 April, dubbed ‘Liberation Day’ by US President Trump, the US claims over 50 countries have reached out for negotiations. “It’s been a week, and this is causing real damage to the economy. Credit markets starting to show signs of stress,” said Swift. “We are increasingly concerned as this continues to play out with no sign of resolution.” The ICIS economist sees a 34% probability of a recession in the US economy in the next 12 months but adds that “the risk of recession is rising every day this goes on”. US PE, EG EXPORTS TO CHINAChina plans to retaliate against the retaliation, upping the tariff ante by another 50% and bringing tariffs on US imports to 84% if implemented on 10 April. US exports of polyethylene (PE) and ethylene glycol (EG) to China can fully be expected to grind to a halt. Since 2018, the start of the first US-China trade war, US ethylene, PE and EG exports to China have exploded more than four times to over 3.5 million tonnes in 2024, with PE at around 2.4 million tonnes – more than three times the volumes in 2018, according to the ICIS Supply and Demand Database. US PE exports to China accounted for between 15-20% of total US PE exports, depending on grade. US EG exports accounted for over 30% of total US EG exports. "There is no other market that can absorb as much EG as China. There could be some reshuffling, but not complete substitution," said Antulio Borneo,  vice president and Americas olefins lead analyst at ICIS. Even with China’s initial planned retaliatory tariffs of 34%, “US PE margins go negative at current production costs,” said Harrison Jacoby, director of PE at ICIS, who noted that US PE exports overall have been down 8.1% year to date. While US PE exports could shift to Europe, the EU is planning retaliatory tariffs against the US, with PE initially among the targets. In retaliation for US 25% tariffs on steel and aluminium imports that took effect on 12 March, the EU approved a new round of tariffs on imports from the US on 9 April. The initial list of proposed tariffs released in March included high density PE (HDPE), linear low density PE (LLDPE) and low density PE (LDPE), along with a range of plastics and rubber products. The EU tariff levels percentage levels reportedly range from 10-25%, with one set of tariffs to go into effect on 15 April and another on 15 May, according to media reports. On 9 April the US implemented 20% tariffs on imports from the EU as part of its broad reciprocal tariffs. The US is also a major exporter of PE to Europe. In 2024, the US exported nearly 1.5 million tonnes of LLDPE, over 500,000 tonnes of HDPE, and around 150,000 tonnes of LDPE to the EU; representing around 19% of total LLDPE exports, 11% of total HDPE exports and 8% of total LDPE exports, according to the ICIS Supply and Demand Database. US PE exports to the EU in 2024 were almost 1.5 times higher than in 2018. Total US PE exports to China and Europe comprised 32% of total US PE exports in 2024. The US is a major importer of methylene diphenyl diisocyanate (MDI) with China and the EU as major suppliers. With 104% tariffs on China, the US will not see anything close to the 229,000 tonnes of MDI imported from China in 2024, which accounted for 57% of total US MDI imports, according to the ICIS Supply and Demand Database. CHINA EXPOSUREUBS analyst Joshua Spector on 9 April highlighted publicly traded US chemical companies’ exposure to China. Those with a meaningful percentage of sales from China include Methanex (22%), Celanese (19%), DuPont (19%), Huntsman (18%), Eastman, Axalta Coating Systems, PPG (all at 11%), and Celanese and Dow (both 10%). “Chemical demand in China is typically about equal to US and Europe combined. China is overall a net importer of petrochemicals but an exporter of several coal and mineral-based chemicals (including caustic soda and titanium dioxide), and often several niche chems (rare earth chemicals, pesticide ingredients, etc) that are small but critical to many chemicals,” said Spector. Visit the US tariffs, policy – impact on chemicals and energy topic page Infographics by Yashas Mudumbai Insight article by Joseph Chang

09-Apr-2025

NEW YORK (ICIS)–2 April 2025 – dubbed ‘Liberation Day’ by US President Trump – saw a sweeping and substantial salvo of reciprocal tariffs, with a baseline tariff set at 10% but for many countries, much higher customized levels. The higher reciprocal tariffs are scheduled to come into effect on 9 April, with the baseline 10% tariff imposed on 5 April. However, as of 8 April, there is emerging optimism on the potential for trade deals following comments from US President Trump that South Korea and China want to make a deal, and from administration officials that the US is in discussions with a number of countries. The reciprocal tariff levels – which include 34% on China, 20% on the EU, 46% on Vietnam, 32% on Taiwan, 26% on India, 25% on South Korea and 24% on Japan – were very much higher than anticipated. For China, 34% in reciprocal tariffs to come into effect on 9 April would be on top of the previous 20% tariffs the US implemented in February (10%) and March (10%), catapulting additional US tariffs on China this year to 54%. Products that fall under US sectoral tariffs, such as 25% on autos and auto parts, in effect since 5 April, will be exempt from the reciprocal tariffs. Products flagged for upcoming sectoral tariffs – pharmaceuticals, semiconductors, lumber and copper – will also be exempt from reciprocal tariffs. For Canada and Mexico, the US 25% tariff will remain in place, but only for non-USMCA (US-Mexico-Canada Agreement) compliant imports. DIRECT IMPACT ON US CHEMICAL MARKETSTariffs will undoubtedly raise costs for the US chemical industry and its customers, in the form of logistics, feedstocks and components such as additives and catalysts. For certain product chains where the US is self-sufficient, the direct impact should be somewhat limited. For example, Canada is the dominant exporter of chemicals and plastics to the US, but these are primarily in the olefins chain – polyethylene (PE), polypropylene (PP), propylene and ethylene glycol (EG) – where the US is more than self-sufficient and a big net exporter. These should also be USMCA compliant and thus exempt from tariffs. Even if there was a disruption, US producers in the US Gulf Coast could ship more volumes of ethylene and propylene derivatives domestically, replacing imports from Canada – although at higher logistics costs to some locations. The aromatics chain is more complicated. The US is a large net importer of benzene, toluene, xylenes and paraxylene (PX) – the bulk of which comes from South Korea, which is being hit with a 25% reciprocal tariff. The EU also exports aromatics to the US and will be subject to a 20% tariff. The US is a major importer of methylene diphenyl diisocyanate (MDI) with China and the EU as major suppliers. With 20% in additional tariffs imposed on all China exports in two stages – February (10%) and March (10%) – on top of the existing 25% tariff on China MDI, the US tariff on MDI from China is 45%. Adding the 34% reciprocal tariff brings this to a whopping 79% tariff level by 9 April. US EXPORTS IN CROSSHAIRS FOR RETALIATIONThe bigger risk to the US is for chemical and plastics exports. The US runs a chemical trade surplus of over $30 billion, according to the American Chemistry Council. Already China has announced a 34% tariff on all US imports to go into effect 10 April, while the EU prepares €18 billion in tariffs that would go into effect 15 April. The latter, which is in retaliation for US steel and aluminium tariffs, includes US PE and other polymers and chemicals. Even as the US is a much larger goods importer than exporter, particularly with China, it is the reverse for the US chemical industry, which will bear the brunt of the impact. “US goods exports to China in 2024 were $143.55 billion. The US imports far more – $462.64 billion – but this will have an impact on the US chemical industry as we compete against producers in the Middle East and elsewhere in Asia,” said Kevin Swift, ICIS senior economist for global chemicals. “This is the first large retaliatory challenge. Let’s hope it doesn’t devolve into a swirling beggar-thy-neighbor trade war,” he added. The new China 34% tariff on imports from the US could result in a $34 billion falloff in US exports of all goods to the nation – about a 24% decline, according to an analysis by Swift. Since 2018, the year that the first US-China trade war kicked off by the first Trump administration, US commodity chemical net exports have surged 88% to 2024, and are thus far more exposed to retaliatory tariffs than ever before. During this period, US exports of commodity chemicals and polymers to the world have increased 28% while imports declined 5%, according to the ICIS Supply and Demand Database. Top US chemical and polymers exports are linear low density PE (LLDPE), high density PE (HDPE), EG, polyvinyl chloride (PVC), caustic soda, methanol, low density PE (LDPE), vinyl chloride monomer (VCM), polypropylene (PP) and styrene. If China puts an additional 34% import tariff on US PE, the economics for exports do not work, even with the substantial US cost advantage. “With a 34% tariff on top of the current 6.5% tariff, US PE margins go negative at current production costs. US PE demand has been weak so far this year, particularly exports, down 8.1% year on year,” said Harrison Jacoby, director of PE at ICIS. “We see rebalancing of trade – less US PE into China, more to Europe. The industry already saw the start of this trend in 2024, with more US PE shifting from China to Europe. Now we need to see how Europe reacts on 13 April with its proposed retaliation targeting US PE, if they will increase their current 6.5% duty,” he added. In retaliation for US 25% tariffs on steel and aluminium imports that took effect on 12 March, the EU plans a new round of tariffs on around €18 billion of imports from the US, which includes high density PE (HDPE), linear low density PE (LLDPE) and low density PE (LDPE) along with a range of plastics and rubber products. This would be implemented in mid-April following a consultation period. The US is also a major exporter of PE to Europe. Total US PE exports to China and Europe were 32% of total US PE exports in 2024, according to the ICIS Supply and Demand Database. “The big picture is there are two low-cost PE regions that are the only net exporters – the US and Canada and the Middle East. These regions will continue to fill global production shortfalls, optimizing to mitigate the impact of tariffs,” said Jacoby. However, demand growth is likely to fall as a trade war will only further weaken demand for all goods and services, he added. Retaliatory tariffs on key US chemical exports could also have ripple effects throughout the chain. For example, retaliatory tariffs on US PE could lower cracker operating rates, in turn reducing crude C4 (CC4) feedstock coming out of those crackers for butadiene (BD) production. “I am concerned about impacts on our suppliers and customers. If there’s an impact on the ethylene industry which causes rate reductions because exports [of derivatives such as PE] get tougher, that would have an indirect effect on our supply of CC4s,” said Ed Dineen, CEO of BD producer TPC Group, in an interview with ICIS at the International Petrochemical Conference (IPC), hosted by the American Fuel and Petrochemical Manufacturers (AFPM). HIT TO KEY END MARKETSKey chemical end markets such as housing, automotive and durable goods will be burdened with higher costs with these reciprocal tariffs. Demand in these sectors has already been struggling for more than two years. “The economic law of demand holds that as prices of a good rise, demand for the good will fall,” said Kevin Swift, ICIS senior economist for global chemicals. US sectoral tariffs of 25% on steel and aluminium, in effect since March, will add nearly $1,500 to the cost of a light vehicle and result in lower sales for the automotive industry, he estimated. This would push down sales by about 525,000 units if the cost is fully pushed through, said Swift. In addition, 25% sectoral tariffs on autos and auto parts will put further upward pressure on pricing, in turn lowering demand further. The ultimate price impact, and not just for automotive, will also depend on consumer demand. It is likely the higher costs from tariffs will be shared by producers, suppliers and consumers. Housing costs are also poised to rise, with sectoral tariffs on steel and aluminum, and signaled tariffs on lumber and copper, along with reciprocal tariffs that will cover other imported goods such as vinyl floors, furniture, carpets and appliances. Consumer confidence is unlikely to improve anytime soon. The Conference Board’s consumer confidence reading in March for future expectations plunged 9.6 points, to 65.2, the lowest in 12 years. Inflation expectations for the next 12 months rose from 5.8% in February to 6.2% in March as consumers were concerned about high prices and the impact of tariffs. One silver lining is that other countries may lower their tariffs and trade barriers in response to US reciprocal tariffs, opening markets for US exports and in turn leading to the US lowering its reciprocal tariff levels. WALL STREET CUTS EARNINGS ESTIMATESIn the meantime, Wall Street is making sizeable cuts to US chemical company profit forecasts, with tariffs expected to squeeze margins in the form of higher costs as well as lower demand. “Uncertainty over tariffs has weakened US PE/PP trading volumes and we expect shifts in trade flows to create near-term negative supply chain/production impacts, which could be negative for Q1,” said UBS analyst Joshua Spector in a 7 April research note. “We are lowering estimates and price targets to better reflect a global [slowdown] that spills into 2026 and 2027,” said Jefferies analyst Laurence Alexander in a 7 April research note. “While we could easily be proven wrong by a couple of tweets (either escalating further or shifting from dramatic action to symbolism, bluff and rhetoric), we are adjusting our framework to reflect the current state of policy,” said Alexander. THE BIG PICTUREUltimately, US President Trump aims to engineer a “once in a hundred year pendulum shift” in the global economy and geopolitical order, said Rana Foroohar, global business columnist at the Financial Times, at the IPC hosted by the AFPM. “Tariffs are for real. Tariffs are here to stay…Trump sees the global economy as a giant gaming table, with the US consumer market as the biggest chip to put down. And he is going to use it in ways we haven’t seen in half a century, if not more,” said Foroohar. “This imbalance between Wall Street and Main Street – between the asset growth economy and the income-led economy – is really at the heart of what’s going on today…Cheaper is going away [and] place matters,” Foroohar added. Visit the ICIS Topic Page: US tariffs, policy – impact on chemicals and energy Infographics by Yashas Mudumbai Insight article by Joseph Chang and Yashas Mudumbai

08-Apr-2025

SINGAPORE (ICIS)–Here are the top stories from ICIS News Asia and the Middle East for the week ended 28 March. Japan Mar manufacturing activity deteriorates as output, new orders fall By Nurluqman Suratman 24-Mar-25 12:28 SINGAPORE (ICIS)–Japan's manufacturing purchasing managers' index (PMI) fell to 48.3 in March, marking its lowest point since February 2024 amid a sharp drop in output and new orders, preliminary estimates from au Jibun Bank showed on Monday. INSIGHT: Chandra Asri prioritizes Indonesia chlor-alkali-EDC project By Pearl Bantillo 24-Mar-25 19:42 SINGAPORE (ICIS)–Indonesian producer Chandra Asri Petrochemical is proceeding with its flagship chlor-alkali (CA) ethyl dichloride (EDC) project, taking a bottom-up approach in its planned second petrochemical complex amid a challenging global landscape. Asia MEK faces demand slowdown, mounting cost pressure entering Q2 By Joy Foo 25-Mar-25 13:19 SINGAPORE (ICIS)–Asia’s methyl ethyl ketone (MEK) prices have declined in March due to weakened demand, but Chinese makers’ cost pressure and low inventories may limit further market downside in the near term. INSIGHT: China's solar policy deadlines fuel volatility of EVA market By Joanne Wang 26-Mar-25 12:00 SINGAPORE (ICIS)–The recurring “rush-to-install” phenomenon in China’s photovoltaic (PV) industry- marked by deadlines like April 30 and May 31 – has profound ripple effects on China’s EVA (Ethylene Vinyl Acetate) market, a critical material for PV encapsulation films. INSIGHT: Can Q2 heavy turnarounds pull Asia MEG market out of its malaise? By Judith Wang 26-Mar-25 13:00 SINGAPORE (ICIS)–Asia's monoethylene glycol (MEG) prices had plunged to a six-month low by late March driven by slower-than-expected demand recovery and ample domestic supply in China. Emission regulations, lower cost needed for alternative marine fuels support – IEA By Jonathan Yee 26-Mar-25 17:41 SINGAPORE (ICIS)–Accelerating the transition to cleaner energy in the maritime sector will require emission regulations and financial incentives surrounding alternative fuels such as methanol and ammonia, according to the International Energy Agency (IEA)’s Regional Cooperation Centre. China presses on with PP exports as supply pressure intensifies By Jackie Wong 27-Mar-25 12:18 SINGAPORE (ICIS)–With self-sufficiency on the rise and even more production capacities coming onstream through 2027, China is pressing on with its polypropylene (PP) exports, even as weak economic conditions and slow end-product demand persist. Asia automakers’ shares slump on US’ 25% tariffs on car imports By Jonathan Yee 27-Mar-25 12:14 SINGAPORE (ICIS)–Shares of automotive companies in Asia slumped on Thursday after US President Donald Trump signed an executive order imposing 25% tariffs on all foreign-made cars from 2 April. Asia imports more US ethane feedstock on diversification, trade diplomacy By Jonathan Yee 27-Mar-25 15:30 SINGAPORE (ICIS)–Asian petrochemical firms are expected to import more US ethane feedstock in the coming years as energy diversification efforts grow in the region, alongside southeast Asian leaders looking to improve trade relations with the US amid President Donald Trump’s tariff threats on countries with trade surpluses. S Korea carmakers call for government measures to mitigate US tariff impact By Nurluqman Suratman 28-Mar-25 12:44 SINGAPORE (ICIS)–South Korea’s automotive industry leaders on Friday called on the government to implement measures to soften the expected impact of US tariffs, which will take effect in early April. INSIGHT: Asia adipic acid waits on verdict from Europe ADD investigations By Josh Quah 28-Mar-25 13:00 SINGAPORE (ICIS)–An ongoing anti-dumping duty investigation from the European Commission on adipic acid imports from China have rocked Asia adipic markets in recent weeks.

31-Mar-2025

SAN ANTONIO (ICIS)—Dow Chemical has indefinitely shut down its ethylene glycols (EG) unit at its Seadrift, Texas site, according to a company representative at this year’s International Petrochemicals Conference (IPC). The site went down due to an electrical failure before Winter Storm Enzo in late January, and remained down for the planned maintenance, originally scheduled for mid-February. The EG unit at the site has an annual capacity of 300,000 tonnes, according to the ICIS Supply & Demand Database. The ethylene oxide (EO) unit at the site is expected to restart in May, following the turnaround. Dow will focus on producing purified EO at the site for other derivatives consumption, including ethanolamines and glycol ethers. Hosted by the American Fuel & Petrochemical Manufacturers (AFPM), the IPC takes place on 23-25 March in San Antonio, Texas. 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

23-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

HOUSTON (ICIS)–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, heading into this year’s International Petrochemical Conference (IPC). Because US domestic suppliers of polyurethane products expect a cascading inflationary effect of these tariffs, they are trying to price the cost of this inflation in new pricing offers for Q2. At the same time, these tariffs could hinder demand for polyurethane products in downstream industries such as automotive, construction, the comfort sector (furniture and bedding) and appliances. 25% TARIFFS RISK CAUSING DISRUPTION IN THE AUTOMOTIVE SECTORThe ongoing worldwide tariff conflict heightens the chances of the automobile sector experiencing a prolonged disruption phase. This could imply a halt in the production of several car models, increased prices for new vehicles, and production delays due to hurdles in product development for the subsequent years, experts say. Automotive seating consumes large volumes of TDI and flexible polyether polyols. Some analysts approximate that nearly one-third of North America's vehicle production could face reductions as a response to the 25% tariffs on Mexico and Canada imposed by US President Donald Trump. These cuts would be part of the automakers attempts to balance the escalated costs, and simultaneously, consumers might procrastinate their new car and truck purchases. Flavio Volpe, the President of the Automotive Parts Manufacturers' Association (APMA), representing Canada's OEM suppliers within the global auto industry, has shared that Canadian car parts suppliers have funneled more than $10 billion into parts facilities situated across 26 US states. These plants employ up to 48,000 US workers, equating to the workforce of roughly 5-10 large car and truck factories. Focusing on Michigan, it alone houses 55 Canadian parts factories employing 17,000 US workers. TARIFFS MIGHT HINDER CONSTRUCTION SECTOR RECOVERYThe latest US housing starts numbers brought some hope for a recovery of the construction sector, which consumes a large amount of MDI and rigid polyols. 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. After plunging 9.8% month on month in January amid harsh winter weather, US housing starts rebounded 11.2% in February to an adjusted annual rate of 1.501 million, according to US Census Bureau data. February’s increase was led by an 11.4% gain in the single-family segment, noted Kevin Swift, ICIS senior economist for Global Chemicals. This segment is more sensitive to interest rates and housing costs that affect affordability. It is also more plastics intensive than the multifamily segment. DEMAND FROM THE COMFORT SECTOR REMAINS WEAKPoor demand continues to plague the comfort sector (furniture and bedding), with the latest sales on President's Day not showing the traditional consumer interest the industry expected. The comfort sector consumes the largest volumes of TDI and flexible polyether polyols. There is hope that demand might recover in the second half of the year. Labor Day is traditionally the strongest sales day of the year for furniture and bedding items. However, the latest consumer sentiment data does not bode well for expectations on consumer expenditures, which make up 70% of the US GDP. US consumer sentiment fell nearly 11% month on month in March amid ongoing economic policy and tariff uncertainties and inflation fears. The Michigan “Index of Consumer Sentiment” fell to 57.9 points in March, from 64.7 in February, according to preliminary results of the University of Michigan’s monthly consumer survey. Sentiment has now fallen for three consecutive months and is down 22% from December 2024. FLAME RETARDANTS FACE RISK OF SUBSTANTIAL INCREASESExpectations of further tariff increases are also feeding concerns about the rise of cost of flame retardants used in various polyurethane foams in the US. Case in point is Tris (chloropropyl) phosphate (commonly abbreviated TCPP), a chlorinated organophosphate flame retardant commonly added to polyurethane foams. TCPP is currently imported from China, often in blended form, but it can also be purchased as a sole product. Its cost in the US is currently above $2/lb and rising, although it's still available in Canada for 58 cents/lb. The prospect for further increases on imported products is having market participants scrambling to find TCPP alternatives that are economically viable. According to sources, some alternatives currently under consideration are Triethyl Phosphate (TEP), a halogen free flame retardant, and Tris(1,3-dichloro-2-propyl) phosphate (also known as chlorinated Tris, TDCP, TDCPP or Fyrol FR-2). There are other flame retardants available as well, but the key is to be able to find a solution that is economically viable compared to the cost of TCPP. Compounding the problem, last December China limited the sales of flame-retardant precursor antimony for exports, since antimony is also a dual-use product that can end up in military applications. Since 2020, antimony prices have increased over 234%, according to data from the Institute for Rare Earths and Metals. ANTICIPATION OF TARIFFS INFLATIONARY EFFECT DRIVES SUPPLIERS TO OFFER HIGHER PRICESCurrent negotiations for April and Q2 polyurethane pricing are wrapping up amid continued efforts by suppliers to increase prices. Especially in the flexible polyol segment, domestic suppliers are mentioning "margin improvement" and "inflation adjustment" needs as the main rationale for these price increases, which in some cases have come on top of prior increases announced in February for March. Foamers are fighting these increases, which have been offered for MDI and TDI as well. Fundamentals do not seem to support these Q2 increase efforts. To begin with, downstream demand is not recovering any time soon. Second, there is plenty of product in the market despite some minor turnarounds in effect for MDI and TDI between mid-March and mid-Aril. Third, feedstock costs are not justifying price increases, either. All main polyurethane feedstocks such as propylene, benzene, toluene, ethylene glycol and 1,4 butanediol (BDO) are moving on downtrend trajectories. Rather than being an adjustment to market dynamics, these increase pressures find their rationale in inflationary expectations of these tariffs, which polyurethane suppliers seem to be taking for granted. Hosted by the American Fuel & Petrochemical Manufacturers (AFPM), the IPC takes place on 23-25 March in San Antonio, Texas. 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 Umberto Torresan (Thumbnail shows polyurethane foam. Image by Shutterstock.)

21-Mar-2025

HOUSTON (ICIS)–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. The US chemical industry, a massive net exporter of chemicals and plastics to the tune of over $30 billion annually, is particularly exposed to retaliatory tariffs. Chemical company earnings guidance for Q1 and all of 2025 is already subdued, with the one common theme from the investor calls being little-to-no help expected from macroeconomic factors this year. Tariffs only cloud the outlook further. Tariffs have long been a feature of US economic and fiscal policy. In the period to the 1940s, tariffs were used as a major revenue source to fund the federal government before the introduction of the income tax and were also used to protect domestic industries. After 1945, a neo-liberal world order arose, which resulted in a lowering of tariffs and other trade barriers and the rise of globalization. With the collapse of the Doha Round of trade negotiations in 2008, this drive stalled and began to reverse. Heading into this year’s International Petrochemical Conference (IPC) hosted by the American Fuel & Petrochemical Manufacturers (AFPM), it is clear that the neo-liberal world order has ended. Rising geopolitical tensions and logistics issues from COVID led many firms to diversify supply chains, leading to reshoring benefiting India, Southeast Asia, Mexico and others, and to the rise of a multi-polar world. It is also resulting in the rise of tariffs and other trade barriers around the world, most notably as US trade policy. FLUID US TRADE POLICYThe US administration’s policy stance on tariffs has been very fluid, changing from day to day. It is implementing 25% tariffs on steel and aluminium imports on 12 March and has already placed additional tariffs of 20% on all imports from China as of 4 March (10% on 4 February, plus 10% on 4 March). On 11 March, the US announced steel and aluminium tariffs on Canada would be ramped up to 50% in retaliation for Canadian province Ontario placing 25% tariffs on electricity exports to the US. Later, Ontario suspended the US electricity surcharge, and the US did not impose the 50% steel and aluminium tariff. The US had placed 25% tariffs on imports from Canada (10% on energy) and Mexico on 4 March but then on 5 March exempted automotive and then on 6 March announced a pause until 2 April. China retaliated by implementing 15% tariffs on US imports of meat, fish and various crops, along with liquefied natural gas (LNG) and coal. Canada retaliated with 25% tariffs on C$30 billion worth of goods on 4 March and then with the US pause, is delaying a second round of tariffs on C$125 billion of US imports until 2 April. Mexico planned to retaliate on 9 March but has not following the US pause. US President Trump has also threatened the EU with 25% tariffs. We have a trade war and as 1960s Motown artist Edwin Starr sang, “War, huh, yeah… What is it good for?… Absolutely nothing.” Canada, Mexico and China are the top three trading partners of the US, collectively making up over 40% of US imports and exports. The three North American economies, until recently, had low or non-existent tariffs on almost all of the goods they trade. This dates back to the 1994 NAFTA free trade agreement, which was renegotiated in 2020 as the USMCA (US-Mexico-Canada Agreement). A reasoning behind the tariff threats on Canada and Mexico is to force Canada and Mexico to stop illegal drugs and undocumented migrants from crossing into the US. These tariffs were first postponed in early February after both countries promised measures on border security, but apparently more is desired. But the US also runs big trade deficits with both countries. Here, tariffs are seen by the administration as the best way to force companies that want US market access to invest in US production. IMPACT ON AUTOMOTIVEUS automakers are the most exposed end market to US tariffs and potential retaliatory tariffs, as their supply chains are even more highly integrated with Mexico and Canada following the USMCA free trade deal in 2020. The USMCA established Rules of Origin which require a certain amount of content in a vehicle produced within the North America trading partners to avoid duties. For example, at least 75% of a vehicle’s Regional Value Content must come from within the USMCA partners – up from 62.5% under the previous NAFTA deal. Supply chains are deeply intertwined. In the North American light vehicle industry, materials, parts and components can cross borders – and now potential tariff regimes – more than six times before a finished vehicle is delivered to the dealer’s lot. US prices for those goods will likely rise. The degree to which they rise (extent to which tariffs costs will pass through) depends upon availability of alternatives, structure of the domestic industry and pricing power, and currency movements. In addition, some of the Administration’s polices dealing with deregulation, energy, and tax will have a mitigating effect on the negative impact of tariffs for the US. The 25% steel and aluminium tariffs will add nearly $1,500 to the cost of a light vehicle and will result in lower sales for the automotive industry which has been plagued in recent years by affordability issues. If it had been implemented, the 50% tariff on steel and aluminium imports from Canada would only compound the pricing impact. All things being equal, 25% tariffs on the metals would push down sales by about 525,000 units but some of the favorable factors cited above as well as not all costs being passed through to consumers will partially offset the effects of higher metal prices. Partially is the key word. Since so many parts, components, and finished vehicles are produced in Canada and Mexico, US 25% tariffs on all imports from Canada and Mexico would add further to the price effects. The economic law of demand holds that as prices of a good rise, demand for the good will fall. ECONOMIC IMPACTTariffs will dampen demand across myriad industries and markets, and could add to inflation. By demand, we mean the aggregate demand of economists as measured by GDP. Aggregate demand primarily consists of consumer spending, business fixed investment, housing investment, and government purchases of goods and services. Tariffs would likely add to inflation but the effects would begin to dissipate after a year or so. By themselves, the current round of tariffs on steel and aluminium and on goods from Canada, Mexico and China will dampen demand due to higher prices. Plus, as trading partners retaliate, US exports would be at risk. Preliminary estimates suggest the annual impact from these tariffs – in isolation – on US GDP during the next three years could average 1.4 percentage points from baseline GDP growth. Keep in mind that there are many moving parts to the economy and that the more favorable policies could offset some of this and, as a result, the average drag on GDP could be limited to a 0.5 percentage point reduction from the baseline. POTENTIAL GDP IMPACT OF US TARIFFS – 20% ON CHINA, 25% ON MEXICO AND CANADA Real GDP is a good proxy for what could happen in the various end-use markets for plastic resins and the reduction of US economic growth. In outlying years, however, tariffs could support reshoring and business fixed investment. The hits on Mexico and Canada would be particularly. China’s economic growth would be affected as well. But China can shift exports to other markets. Mexico and Canada have fewer options. Resilience will be key to growing uncertainty and will lead to shifting trade patterns and new market opportunities. This is where scenarios, sound planning and strategies, and leadership come into play. US EXPORTS AT RISK, SUPPLY CHAINS TO SHIFTUS PE exports are particularly vulnerable to retaliatory tariffs. The US is specifically targeting tariffs on countries and regions that absorb around 52% of US PE exports – China, the EU, Mexico and Canada, according to an ICIS analysis. Aside from PE, the US exports major volumes of PP, ethylene glycol (EG), methanol, PVC, styrene and vinyl chloride monomer (VCM), along with base oils to countries and regions targeted with tariffs. The US exports nearly 50% of PE production with China and Mexico being major outlets. China has only a 6.5% duty on imports of US PE, having provided its importers with waivers in February 2020 that took rates to pre-US-China trade war levels. The US-China trade war under the first US Trump administration started in 2018 with escalating tariffs on both sides, before a phase 1 deal was struck in December 2019 that removed some tariffs and reduced others. After the waivers offered by China to importers in February 2020, US exports of PE and other ethylene derivatives surged before falling back in 2021 from the COVID impact. They then rocketed higher through 2023 and remained at high levels in 2024. Since 2017, the year before the first US-China trade war, US ethylene and derivative exports to China are up more than 4 times, leaving them more exposed than ever to China. With tariff escalation, chemical trade flows would shift dramatically. Just one example is in isopropanol (IPA). Shell in Sarnia, Ontario, Canada, produces IPA, of which over 85% is shipped to the US, mainly to the northeast customers, said ICIS senior market analyst Manny Borges. “It is a better supply chain for the customers instead of shipping product from the US Gulf,” said Borges. “With the increase in tariffs, we will see several customers shifting volumes to domestic producers or countries where the tariffs are not applied,” he added. US IPA producers are running their plants at around 67% of capacity on average and have sufficient capacity to supply the entire domestic market, the analyst pointed out. This dynamic, where US producers supply more of the local market versus imports, would likely play out across multiple product chains as well, especially in olefins where the US is more than self-sufficient. Even as the US is more than self-sufficient in, and a big net exporter of PE, ethylene glycols, polypropylene (PP) and polyvinyl chloride (PVC), it imports significant quantities from Canada. In the event of a 25% tariff on imports from Canada, US producers could easily fill the gap, although logistics would have to be reworked. Hosted by the American Fuel & Petrochemical Manufacturers (AFPM), the IPC takes place on 23-25 March in San Antonio, Texas. Visit the US tariffs, policy – impact on chemicals and energy topic page Visit the Macroeconomics: Impact on chemicals topic page Insight article by Kevin Swift and Joseph Chang

12-Mar-2025

HOUSTON (ICIS)–Shipping container rates from Asia to both US coasts fell again this week as capacity has grown and as volumes have fallen after frontloading to beat tariffs, and liquid tanker rates rose on the transatlantic eastbound route and fell on the US Gulf to Asia trade lane. CONTAINER RATES Rates from Shanghai to Los Angeles fell by 9% this week, according to supply chain advisors Drewry, while rates from Shanghai to New York fell by 6%, as shown in the following chart. Rates to both US coasts are now at their lowest of the year, according to Drewry data. Global average rates in Drewry’s World Container Index fell by 3% and are also at their lowest over the past year, as shown in the following chart. Drewry expects rates to continue to decrease next week due to increased shipping capacity. Rates from online freight shipping marketplace and platform provider Freightos showed significant decreases this week, although their rates are slightly higher than Drewry’s. Judah Levine, head of research at Freightos, said that tariffs – or the threat of tariffs – led to many importers frontloading volumes to beat the announced levies. “The president’s proposed 60% tariffs on Chinese goods could go into effect as soon as April – as could a wider application of reciprocal tariffs on numerous countries – meaning the window to receive goods before then is about closed,” Levine said. Levine said that the combination of a seasonal slump in demand and the possible end of frontloading likely drove the sharp fall in transpacific ocean rates last week. “If frontloading of the past few months was significant enough, we could also expect to see subdued peak season demand and rates as a result,” Levine said. Container ships and costs for shipping containers are relevant to the chemical industry because while most chemicals are liquids and are shipped in tankers, container ships transport polymers, such as polyethylene (PE) and polypropylene (PP), are shipped in pellets. Titanium dioxide (TiO2) is also shipped in containers. They also transport liquid chemicals in isotanks. LIQUID TANKER RATES MIXED US chemical tanker freight rates assessed by ICIS were mixed week on week. Trade routes from the US remain mixed with several trade lanes slightly higher and others lower. Cargo moving into Asia weakens following the recent tariff announcements and this route has recently seen a decrease of cargoes, as the tariffs have all but halted any spot activity for this trade lane. As a result, rates have dipped from the previous week. On the other hand, the rates from USG to Rotterdam experienced upward pressure. For this trade lane freight rates for March have strengthened, given the amount of space left. A shipowner said it is expecting the trend to continue throughout March, with higher contract of affreightment (COA) utilization leaving very little available space. From the USG to Brazil, this market has remained relatively unchanged but is experiencing some downward pressure. While the market continues to be active it is further influenced by freight availability and a swing in trade lane dynamics. Demand remains soft particularly for larger parcels further pressuring some downward movement. On the USG to India trade lane, the market remains extremely soft with plenty of space available as outsiders have entered the market. As a result, this has placed downward pressure, and rates could fall further on the route if this persists. Several inquiries were seen for monoethylene glycol (MEG), methanol, ethanol, and vinyl acetate monomer (VAM), but few fixtures were seen in the market. With additional reporting by Kevin Callahan

07-Mar-2025