Mono propylene glycol (MPG)

HOUSTON (ICIS)–The US election could see Donald Trump return as president with majorities in both legislative chambers, which could bring a reduction in excessive red tape, weaker support for electric vehicles (EVs) and impose even more ponderous tariffs and trade restrictions. Incumbent President Joe Biden has dropped out of the race, and current polls show Trump ahead in the election The House of Representatives and the Senate are closely split between the nation's two major parties, so the Republican party could obtain majorities in both legislative chambers Regardless of who wins the presidential election on 5 November, the outlook remains pessimistic for tariff relief and trade deals in the US US TRADE POLICY WILL REMAIN RESTRICTIVERegardless of who wins the presidential election, US trade policy will remain restrictive, which could leave the nation's chemical exports vulnerable to retaliatory tariffs imposed during a trade dispute. Also, tariffs could increase the cost of imports of critical chemical intermediates. Biden's campaign website did not discuss trade policy, and he recently dropped out of the race. But he maintained many of the tariffs that Trump introduced during his presidency in 2016-2020. In addition, Biden raised tariffs on EVs from China. He signed bills passed by Congress that required local content rules for government programs. Trump's platform proposed a baseline tariff, with the candidate mentioning 10% for most imports. For China, he mentioned tariffs of more than 60% during an interview on the television program Fox News. Trump's campaign website proposes a reciprocal trade act, under which the US could match tariffs that another country imposes on its exports. Although the platform concedes that reductions are possible, the proposal focuses on the potential of higher tariffs. TRUMP TO ROLL BACK BIDEN'S EV POLICIESBiden did not mention EVs on his campaign website. But during his presidential term, the federal government used multiple laws and regulatory statutes to promote EV adoption. If Trump becomes president, he has pledged to cancel what he calls the electric vehicle mandate. He specified many of Biden's policies that encouraged the adoption of EVs. EVs typically consume more plastics on a per unit basis than automobiles powered by internal combustion engines (ICEs). EVs also pose different material challenges, which is increasing demand for different plastics and compounds. Policies that prolong the use of ICE-based vehicles could extend the operating life of the nation's refineries. Companies could be more willing to invest in maintenance and repairs if they are confident that they could recoup their investments. Refineries produce many building block chemicals, such as propylene, benzene, toluene and mixed xylenes (MX). BIDEN, TRUMP PRESENT EXTREMES ON CHEM REGULATIONSBiden and Trump lay on opposite extremes of regulations and policy. Under Biden, the federal government has adopted numerous regulations, many of which the chemical industry has said provided them with little benefit given the time and expense of compliance. The past six months has been described as the worst regulatory environment that the chemical industry has ever seen. That burdensome regulatory climate could persist if a Democrat wins the election, since personnel from the Biden administration could remain in place. The following lists some of the regulatory policies that could either persist under a Democratic administration or weaken under a Trump administration: The Environmental Protection Agency (EPA) has adopted a whole chemical approach in determining whether a substance poses an unreasonable risk under the nation's main chemical-safety program, known as the Toxic Substances Control Act (TSCA). The regulator is currently reviewing vinyl chloride monomer (VCM), acrylonitrile (ACN) and aniline, a feedstock used to make methylene diphenyl diisocyanate (MDI). Changes to the Clean Waters Act, the Risk Management Program (RMP) and the Hazard Communication Standard that were made by Biden. Biden has promoted environmental justice throughout the federal government. Environmental justice could make it harder for chemical companies to expand existing plants or build new ones. Because these are federal policies, a different president could reverse them. Trump could try to unravel some of Biden's rules to the degree possible under executive authority. However, some of the rules will persist because of entrenched bureaucracy or because they are final. The pace of new regulations would likely slow under a Trump presidency. He has pledged to restore his order that for every new regulation introduced by the federal government, two existing ones must be eliminated. OTHER POLICY DIFFERENCESSuperfund tax: If Trump wins the presidency and Republicans win the legislative branch, that could set up a repeal of the Superfund tax, which imposes taxes on several building-block chemicals and their derivatives. Republican legislators have already introduced bills to repeal the tax. Trump tax cuts: Trump has pledged that he would make his 2017 tax cuts permanent. These are set to expire at the end of 2025 from his previous term in 2016-2020. Oil production: Biden has imposed several restrictions on oil and gas production on federal land and on offshore leases, although this did not stop production from surging in the Permian Basin, much of which is outside of government control. Trump has pledged to remove those restrictions. Insight by Al Greenwood Thumbnail shows US capitol. Image by Lucky-photographer

22-Jul-2024

SINGAPORE (ICIS)–Reliance Industries Ltd’s (RIL) oil-to-chemicals (O2C) business posted a 14.3% year-on-year drop in earnings in its fiscal first quarter ending June 2024 on poor chemicals margins, the Indian conglomerate said. O2C results in 10 million rupees (Rs) Apr-June 2024 Apr-June 2023 % Change Revenue 157,133 133,031 18.1 EBITDA 13,093 15,286 -14.3 Exports 71,463 69,006 3.6 – Revenue for the period rose primarily on the back of higher product prices in line with Brent crude price gains, and increased volumes due to strong domestic demand, the company said on 19 July. – Fiscal Q1 overall earnings before interest, tax, depreciation and amortisation (EBITDA) margin dropped to 8.3% from 11.5% in the same period of last year. – On a year-on-year basis, April-June domestic polymer and polyester demand increased by 8% and 5%, respectively. – RIL's consolidated group profit after tax fell by 4% year on year to Rp175 billion ($2.09 billion) in April-June 2024. Polymers- Fiscal Q1 polymer margins were down by 0.5% to 16.9% year on year due to firm naphtha prices. Product margin over naphtha April-June 2024 ($/tonne) April-June 2023 ($/tonne) % Change Polyethylene (PE) 330 397 -16.9% Polypropylene (PP) 318 381 -16.5% Polyvinyl chloride (PVC) 371 373 -0.5% Polyester – Paraxylene (PX) and monoethylene glycol (MEG) margins over naphtha decreased year on year due to higher naphtha prices. – "PTA [purified terephthalic acid] margins were impacted adversely due to high inventory with Chinese producers and increased competition," the company said. – On a year-on-year basis, domestic polyester demand in fiscal Q1 increased by 5%, driven by strong growth in PET, which was up 27% due to "higher demand from the beverage segment on account of summer season and elections". ($1 = Rs83.7)

22-Jul-2024

SINGAPORE (ICIS)–Asia’s propylene (C3) market will continue to see new capacities coming from China in H2 2024, while demand is also likely to improve as new derivative projects come up. Margin challenges may continue to impact the market by altering the operations for C3 and its derivatives. As China is the largest producer and consumer globally, dynamics in the country will impact the wider Asia C3 market. In this podcast, ICIS senior analyst Joey Zhou discusses with ICIS analyst Seymour Chenxia the trends and outlook for Asia’s C3 market in 2024.

15-Jul-2024

SINGAPORE (ICIS)–Squeezed by high propane costs and weak propylene prices, some Chinese propane dehydrogenation (PDH) operators are turning to a potential lifeline: commercializing hydrogen, a valuable byproduct of their operations. Join ICIS LPG analysts Lillian Ren and Shihao Zhou as they discuss how commercializing hydrogen could turn the tide for China's PDH producers. They'll delve into current market challenges, the potential of hydrogen as a lifeline, and what this shift could mean for the future of the industry.

08-Jul-2024

SINGAPORE (ICIS)–Here are the top stories from ICIS News Asia and the Middle East for the week ended 5 July 2024. OUTLOOK: Snug import supply supports Asia MEG amid slowing demand By Judith Wang 03-Jul-24 11:52 SINGAPORE (ICIS)–Monoethylene glycol (MEG) import supply in Asia for July is expected to stay snug in the near term, while demand looks set to slow down. INSIGHT: Methanol or ethylene, that is the question for China By Doris He 02-Jul-24 17:00 SINGAPORE (ICIS)–China’s methanol-to-olefins (MTO) industry has always been a focus of attention among methanol market players, as it accounts for half of overall demand. More attention has recently been shifted to ethylene, from the overall margins of a typical MTO plant in coastal regions. OUTLOOK: Asia nylon markets may slow down in H2 2024 on lengthened supply By Charmaine Lim 01-Jul-24 14:40 SINGAPORE (ICIS)–Nylon markets in Asia are expected to slow in H2 2024 compared to the first half of the year as the upcoming seasonal lull in Q3 approaches, with new capacities planned to start up in China this year. S Korea antidumping probe on China SM extends to Sept, discussions and hearings ongoing By Luffy Wu 01-Jul-24 15:22 SINGAPORE (ICIS)–The Korea Trade Commission is continuing with its anti-dumping probe against styrene monomer (SM) imports from China, with some discussions and hearings between the government and market players heard ongoing. PODCAST: China oxo-alcohols to face supply-demand pressure, new capacity to be a focus By Claire Gao 01-Jul-24 19:24 SINGAPORE (ICIS)–In this podcast, ICIS analyst Claire Gao explores the oxo-alcohols market overview and outlook. OUTLOOK: Persistent economic woes dampen Asia chemical freight demand By Hwee Hwee Tan 02-Jul-24 12:03 SINGAPORE (ICIS)–Asia’s chemical freight demand is dampened as macroeconomic doldrums were pulling back spot trades well into the third quarter despite reducing plant capacity losses for key liquid bulk products.

08-Jul-2024

SINGAPORE (ICIS)–A consortium consisting of four Asian petrochemical producers have agreed to establish a sustainable polyester fiber supply chain. Japan's Mitsubishi Corp, South Korea’s SK geo centric, Thailand’s Indorama Ventures Ltd (IVL), and India Glycols along with three other companies are part of the consortium, the companies said in a joint statement on Thursday. Japanese sports apparel firm Goldwin is the project owner of the initiative, while Finnish refiner Neste is also part of the consortium alongside Japan-based engineering firm Chiyoda Corp. Financial details of the project were not disclosed. The project aims to utilize renewable and bio-based materials as well as materials produced via carbon capture and utilization (CCU) to manufacture polyester fibers for THE NORTH FACE brand in Japan. Outdoor apparel and equipment brand THE NORTH FACE is operated by Goldwin in Japan. "After that, the launch of further products and brands of Goldwin will be considered," Chiyoda said in the statement. The polyester fiber produced from the project is planned to be used by Goldwin for a part of THE NORTH FACE products, including sports uniforms in July this year. Chiyoda will supply CCU-based paraxylene (PX) to the supply chain, while Thai polyester producer IVL will contribute renewable CCU-based purified terephthalic acid (PTA). In March 2022, Chiyoda started producing carbon dioxide (CO2)-based PX at its pilot plant at the company's Koyasu Research Park in Kanagawa prefecture as part of a project linked with Japan's New Energy and Industrial Technology Development Organization (NED). SK geo centric and Neste will be supplying renewable PX and renewable naphtha, respectively. India Glycols, which produces monoethylene glycol (MEG), will supply bio-ethylene glycol made mainly from sugarcane. Toyobo MC Corporation (TMC) – a joint venture between Toyobo Co and Mitsubishi Corp – will be supplying renewable bio-CCU polyethylene terephthalate (PET). Details on supply volumes from each of the consortium partners were not disclosed. Thumbnail photo: A generic polyester clothing label (Sandvik/imageBROKER/Shutterstock)

04-Jul-2024

HOUSTON (ICIS)–Here are the top stories from ICIS News from the week ended 28 June. US June propylene contracts rise on higher spot prices US June propylene contracts for the majority of market participants settled up 2 cents/lb on higher spot prices. US consumer confidence and ICIS leading business barometer fall in June US consumer confidence fell in June, as did the ICIS US leading business barometer (LBB). Aditya Birla Chemicals plans new US epoxy facility in Texas Aditya Birla Chemicals is planning to build a new epoxy facility in Beaumont, Texas, according to the company. Flat chemical prices to increase in coming quarters; volumes booming – US HB Fuller Most chemical prices have stabilized, and a few are posting small rises, a trend which should strengthen in coming quarters as global manufacturing picks up, executives at US-headquartered adhesives producer HB Fuller said on Thursday. SHIPPING: Panama Canal increases drafts, to add another transit slot on 5 August The Panama Canal Authority (PCA) has increased the maximum allowable draft to transit the Neopanamax locks effective immediately, announced that another increase will take effect on 11 July, and will add an additional booking slot in the Neopanamax locks during Booking Period 2 for booking dates beginning 5 August.

01-Jul-2024

SINGAPORE (ICIS)–Here are the top stories from ICIS News Asia and the Middle East for the week ended 28 June 2024. Asia melamine sees uptick on tighter supply; demand recovery uncertain By Joy Foo 28-Jun-24 12:54 SINGAPORE (ICIS)–Asia’s melamine spot market for China-origin product faced some pressure from early June due to lagging demand. China MEG market supported by limited import arrivals By Cindy Qiu 26-Jun-24 12:20 SINGAPORE (ICIS)–China’s monoethylene glycol (MEG) prices rose after falling in June, reflecting supply-demand dynamics, but the price growth may be capped by increasing domestic supply and curtailed downstream polyester production, despite limited import arrivals expected in July. India’s BPA import price surges; freight continues to exert pressure By Li Peng Seng 24-Jun-24 11:53 SINGAPORE (ICIS)–India’s bisphenol A (BPA) average import price hit its highest level in nearly 20 months recently due to firm ocean freight rates, a phenomenon that is expected to persist in the short term as vessel space is likely to stay tight. PODCAST: Asia base oils supply, demand to gradually rise in H2 By Damini Dabholkar 26-Jun-24 18:13 SINGAPORE (ICIS)–Asia’s base oils supply is expected to improve slightly in H2 2024, while a seasonal peak in overall demand is due to kick off in the later part of Q3. INSIGHT: Asia isocyanates H1 performance mixed, poor expectations for Q3 By Shannen Ng 26-Jun-24 14:30 SINGAPORE (ICIS)–Demand in Asia’s import markets for polymeric methylene diphenyl diisocyanate (PMDI) and toluene diisocyanate (TDI) is likely to remain limited in the upcoming summer months of July and August, and the outlook for late Q3 is uncertain. Chemanol to supply methanol to Saudi Amiral project over 20 years By Pearl Bantillo 25-Jun-24 12:52 SINGAPORE (ICIS)–Saudi Arabia's Methanol Chemicals Co (Chemanol) has signed a 20-year deal to supply methanol to the Amiral petrochemical project of Saudi Aramco Total Refining and Petrochemical Co (SATORP).

01-Jul-2024

HOUSTON (ICIS)–The Panama Canal Authority (PCA) has increased the maximum allowable draft to transit the Neopanamax locks effective immediately, announced that another increase will take effect on 11 July, and will add an additional booking slot in the Neopanamax locks during Booking Period 2 for booking dates beginning 5 August. Source: Panama Canal Authority Water levels at Gatun Lake, the freshwater lake that feeds the canal’s locks have improved recently amid the arrival of the rainy season after a prolonged drought, allowing the PCA to continue to add transit slots. Water levels at Gatun Lake, currently at 81.3 feet, are projected to be at 82.1 feet by mid-July and to 87 feet by December. The transit restrictions that began in July 2023 – the first time in the canal’s history that limitations were placed on the number of daily transits – have gradually eased over the past few months and are approaching the average daily transits of 36-38/day seen prior to impacts from the drought. The improved conditions at the canal are likely to improve transit times for vessels travelling between the US Gulf and Asia, as well as between Europe and west coast Latin America countries. This should benefit chemical markets that move product between regions, including those in the following chart. The bottleneck at the Panama Canal has had varying affects on US chemical markets. Formosa Plastics USA had to shut down its EG2 unit because of negative impacts on monoethylene glycol (MEG) exports because of the backlog and delays transiting the canal. The majority of product from the unit is expected to be exported to Asia. The company restarted the unit this week. Higher water levels at the Panama Canal could also have knock-down effects on US natural gas demand, ICIS feedstocks analyst Barin Wise said. If higher water levels at the canal enable liquefied natural gas (LNG) shippers to cut down on travel times from the US Gulf Coast to Asia, it could encourage LNG export plant managers to maximize output, he said. AUCTION PRICES EASE The PCA said recently that auction prices have levelled off since the peak period last year. In October-November 2023, there was a surge in auction prices related to a market-driven congestion premium, though this is no longer the case, the PCA said. Auction prices are generally near normal levels presently, though auctions remain an invaluable tool and option for customers who may otherwise not have secured reservations. The PCA noted that auction prices are also not set by the waterway, but rather influenced by many factors and market dynamics, including internal considerations such as waiting times and queue lengths, as well as external elements like charter rates and bunker prices. Additionally, the specific preferences and needs of individual customers, which may not be fully captured by the route value model, can also influence auction outcomes. WAIT TIMES FOR NON-BOOKED VESSELS Wait times for non-booked southbound vessels ready for transit have been relatively steady at less than two days, according to the PCA vessel tracker and as shown below. The tracker is only for non-booked vessels in the queue and shippers should consider two additional days as a minimum to estimate transit times for unscheduled vessels, the PCA said. Focus article by Adam Yanelli With additional reporting by Melissa Wheeler, Bryan Campbell and Emily Burleson Thumbnail photo: Shows a container ship transiting the Panama Canal. (Source: Courtesy of PCA)

28-Jun-2024

LONDON (ICIS)–The European oxo-alcohols market and most of its derivatives have been characterized by ample supply in June, particularly following the lifting of OQ Chemicals' force majeure at the end of May. Demand across most markets remains tepid and slow due to ongoing economic challenges. The construction and coatings industries have not experienced the expected seasonal surge. Butyl acetate reporter Marion Boakye speaks to oxo-alcohols reporter Nicole Simpson, glycol ethers reporter Cameron Birch and acrylate esters reporter Mathew Jolin-Beech about market dynamics down the oxo-alcohols value chain.  

24-Jun-2024