Polyurethanes

Optimising profitability in key commodities with expert data and analysis 

Discover the factors influencing polyurethanes markets

Having powerful tools and insights to navigate volatility and spot opportunities across worldwide polyurethanes markets will put you at an advantage. To make the most of profit-making opportunities as they arise, it’s crucial to be able to examine market shifts from every angle. That includes the upstream feedstocks chain – such as benzene and isocyanates markets – as well as the downstream automotive and construction markets which drive demand for polyurethane.

Our global polyurethanes market intelligence delivers everything you need to make smart decisions quickly. Our experts are based in the key regional markets and continuously monitor and report on changes as they happen. We keep you informed so you are able to respond quickly to maximise your profit opportunities.

Learn about our solutions for polyurethanes

Pricing, news and analysis

Maximise profitability in uncertain markets with ICIS’ full range of solutions for polyurethanes, including current and historic pricing, forecasts, supply and demand data, and news and analysis.

Data solutions

Learn about Insight, Hindsight and Foresight, our dedicated commodity solutions accessible through our subscriber platform, ICIS ClarityTM or Data as a Service channels.

Related industries

Find out how ICIS’ expert data and analytics for Polyurethanes help companies in your sector.

Chemicals producer 

Remain competitive today and tomorrow, with a 360-degree view of up- and downstream demand. 

Consumer durables and non-durables 

Confidently plan ahead with a clear view of demand for raw materials and packaging chains.

Plastics and Rubber converter 

Optimise procurement with an end-to-end view of resins and feedstock supply chains.

Polyurethanes news

Europe top stories: weekly summary

LONDON (ICIS)–Here are some of the top stories from ICIS Europe for the week ended 14 February. Europe MX and PX chemical value chain braces for headwinds amid downstream closures and tariff threats Downstream demand for mixed xylenes (MX) and paraxylene (PX) in Europe has been limited at the start of 2025, with permanent shutdowns and the threat of tariffs among the hurdles to a meaningful recovery. Germany's battered chemical industry holds its breath ahead of general election Germany is set to head to the polls on 23 February amid one of the most challenging economic scenarios the country has faced in post-war times. EU gas price cap proposals would drive shipments to other regions – ICIS expert Proposals under consideration in the European Commission to temporarily cap natural gas pricing would likely result in the diversion of supplies away from Europe and tighten supply in the region, an ICIS analyst said on Wednesday. EU promises plan to save chemicals as Clean Industrial Deal approaches The European Commission has promised to address the plight of the region’s energy-intensive petrochemical sector later this year as it gears up for the publication of the Clean Industrial Deal on 26 February. IPEX: Asia finding a floor, up 1%; PVC and PP drive 1.3% index fall in Europe; USG toluene firms The ICIS Petrochemical Index (IPEX) for January shows that northeast Asian chemical markets may be finding a floor after two consecutive months of declines, with the regional index up 1% – only its second gain in six months, driven by a 14.7% surge in butadiene due to rising crude oil costs.

17-Feb-2025

UPDATE: US to start antidumping probe on Chinese MDI on 5 March

SINGAPORE (ICIS)–The US International Trade Commission (ITC) will start on 5 March a preliminary antidumping probe on imports of methylene diphenyl diisocyanate (MDI) from China, acting on a petition from BASF and Dow Chemical. The MDI Fair Trade Coalition – consisting of BASF Corp (Florham Park, New Jersey); and Dow Chemical (Midland, Michigan) – filed the petition on 12 February, citing dumping margins of 305.81% to 507.13% for the Chinese material, according to ITC's statement. ITC will make a preliminary determination on possible dumping by end-March 2025. The petition named producers BASF Polyurethane (Chongqing), Covestro Polymers (China), Shanghai Lianheng Isocyanate, Wanhua Chemical Group, and Wanhua Chemical Ningbo as allegedly dumping MDI into the US. China’s Wanhua Chemical is the world’s largest MDI producer. In 2024, the US imported around 229,000 tonnes of MDI from China, which accounted for 57% of total US MDI imports. The US in turn exported minimal amounts of MDI to China. Chinese MDI is currently subject to 35% tariffs in the US, after the additional 10% levy implemented on 4 February 2025. In his first term as US president, Donald Trump had imposed a 25% tariff on a host of Chinese goods, including MDI in May 2019. China, on the other hand, has a 31.5% tariff on imports of US MDI – a 25% tariff on top of the baseline 6.5% duty. (Adds paragraphs 4-9) Thumbnail image: Heavy Fog Hit Shanghai Port, China – 16 February 2025 (Costfoto/NurPhoto/Shutterstock)

17-Feb-2025

US to start antidumping probe on China MDI imports on 5 March

SINGAPORE (ICIS)–The US International Trade Commission (ITC) will start on 5 March a preliminary antidumping probe on imports of methylene diphenyl diisocyanate (MDI) from China, acting on a petition from BASF and Dow Chemical. The MDI Fair Trade Coalition – which consists of BASF Corp (Florham Park, New Jersey); and Dow Chemical (Midland, Michigan) – filed the petition on 12 February, citing dumping margins of 305.81% to 507.13% for the Chinese material, according to ITC's statement. ITC will make a preliminary determination on possible dumping by end-March 2025.

17-Feb-2025

Japan's Mitsubishi Motors to invest $121 million in the Philippines

SINGAPORE (ICIS)–Japanese carmaker Mitsubishi Motors Corp (MMC) is set to invest Peso (Ps) 7 billion ($121 million) in the Philippines over the next five years. MMC president and CEO Takao Kato announced the plan during a meeting with Philippine President Ferdinand Marcos Jr on 6 February. The plan includes adding a new production model at the Mitsubishi Motors Philippines Corp (MMPC) plant in Laguna province, according to a statement issued by the Presidential Communications Office (PCO). Kato said the Philippines is MMC’s most important investment in southeast Asia, citing its good and stable economy. MMPC operates a manufacturing plant in Santa Rosa, Laguna, with an annual production capacity of 50,000 units, which can be doubled, it stated. As of November last year, MMPC had a 19% share of the domestic market, trailing behind Toyota's 46% share. Marcos also announced that MMC will be part of the government's Revitalizing the Automotive Industry for Competitiveness Enhancement (RACE) program which aims to boost the competitiveness of the local automotive industry. “In the ASEAN, (the) Philippines is our number one market,” MMC’s Kato said. Within southeast Asia, MMC also has production facilities in Thailand, Indonesia and Vietnam. The Japanese carmaker also has manufacturing plants in China and Russia. The automotive industry is a major global consumer of petrochemicals that contributes more than one-third of the raw material costs of an average vehicle. The sector drives demand for chemicals such as polypropylene (PP), along with nylon, polystyrene (PS), styrene butadiene rubber (SBR), polyurethane (PU), methyl methacrylate (MMA) and polymethyl methacrylate (PMMA). ($1 = Ps58)

07-Feb-2025

BP puts Gelsenkirchen, Germany refinery, crackers up for sale

BARCELONA (ICIS)–BP plans to sell its to sell its Ruhr Oel refinery, crackers and downstream assets at Gelsenkirchen in Germany. The company will start marketing the assets immediately, with the aim of completing the sale this year, according to a statement published on 6 February by the UK headquartered energy giant. According to the ICIS Supply & Demand Database BP operates a refinery and two crackers with combined capacity of 1.065 million tonnes/year of ethylene, as well as units with 645,000 tonnes/year propylene, 430,000 tonnes/year benzene plus cumene, cyclohexane, methanol, toluene and ammonia facilities. BP said the assets for sale include DHC Solvent Chemie in Mulheim an der Ruhr. All refinery owners in Europe are under pressure to rationalise their portfolios thanks to the shift to vehicle electrification and high cost base. There is also intense competition from new refineries starting up in Asia and the Middle East. BP said the move is in line with its strategic drive to deliver a simpler, more focused, higher value company. The company said that it has implemented numerous projects to modernize the infrastructure of the refinery in Gelsenkirchen in recent years.  This includes renewing the power grid and establishing an independent steam supply. The refinery can process crude oils from around the world, produce fuels and also has the potential to manufacture biofuels and process recycled plastics, said bp. Michael Connolly, ICIS principal refining analyst pointed out that the refinery is configured to give a moderately high yield of gasoline, meaning it is not really suited to the future of the European market, where vehicle electrification is hurting demand. He said BP already had plans to reduce the capacity of the refinery from 260,000 bbl/day to 155,000 bbl/day in 2025. “Undoubtedly it would have used Russian crude, but despite having access to seaborne crude, the loss of Russian crude through sanctions would have impacted financials,” he said. The economics of the facility will also be more challenging, as for all European refiners, because cracks or margins for gasoil production have declined to pre-Ukraine war levels, added Connolly. ICIS expects German crude refining capacity to fall from 2.1 million bbl/day in 2020 to 1.8 million bbl/day by 2026 and well off their peak refining capacity of 2.4 bd in 2007. Emma Delaney, BP executive vice president, customers & products said, “BP needs to continually manage its global portfolio as we position to grow as a simpler, more focused, higher-value company. After a thorough review, we have concluded that a new owner would be better suited for the site to take it forward. We are convinced that the refinery can unlock its full potential under new ownership.” Focus article by Will Beacham Graphics by Miguel Rodriguez-Fernandez Thumbnail photo: bp's refinery site in Gelsenkirchen, Germany (Source: BP) Clarification: recasts to explain BP has two crackers at the site.

06-Feb-2025

CORRECTED: INSIGHT: US tariffs unleash higher costs to nation's chem industry

Correction: In the ICIS story headlined “INSIGHT: US tariffs unleash higher costs to nation's chem industry” dated 3 February 2025, the wrong volumes were used for the following imports: Canadian ethylene-alpha-olefin copolymers, having a specific gravity of less than 0.94; Canadian polyethylene having a specific gravity of 0.94 or more, in primary forms; Canadian polyethylene having a specific gravity of less than 0.94, in primary forms; Canadian polypropylene, in primary forms; Canadian mixed xylene isomers; Mexican polypropylene, in primary forms; and Mexican cyclohexane. The US did not import cyclohexane from Mexico in 2023. A corrected story follows. HOUSTON (ICIS)–The tariffs that the US will impose on all imports from Canada, Mexico and China will unleash higher costs for the nation's chemical industry, create supply-chain snarls and open it to retaliation. For Canada, the US will impose 10% tariffs on imports of energy and 25% tariffs on all other imports. For Mexico, the US imposed 25% tariffs on all imports but the countries' presidents said on Monday the tariffs are being paused for a month. For China, the US will impose 10% tariffs on all imports. US IMPORTS LARGE AMOUNTS OF PE FROM CANADAUS petrochemical production is concentrated along its Gulf Coast, which is far from many of its manufacturing hubs in the northeastern and midwestern parts of the country. As a result, individual states import large amounts of polyethylene (PE) from Canada – even though the nation as a whole has a large surplus of the material. Even Texas imports large amounts of PE from Canada – despite its abundance of plants that produce the polymer. In addition, polyester plants in North and South Carolina import large amounts of the feedstocks monoethylene glycol (MEG) and purified terephthalic acid (PTA) from Canada. The US as a whole imports significant amounts of polypropylene (PP) and polyvinyl chloride (PVC) from Canada – again, despite its surplus of these plastics. The following table lists some of the main plastics and chemicals that the US imported from Canada in 2023. The products are organized by their harmonized tariff schedule (HTS) code. HTS PRODUCT MEASUREMENT VOLUMES 3901.40.00 Ethylene-alpha-olefin copolymers, having a specific gravity of less than 0.94 kilograms 1,319,817,405 3901.20.50 Polyethylene having a specific gravity of 0.94 or more, in primary forms kilograms 1,088,071,523 3901.10.50 Polyethylene having a specific gravity of less than 0.94, in primary forms kilograms 420,561,390 2917.36.00 Terephthalic acid and its salts kilograms 407,710,439 2905.31.00 Ethylene Glycol kilograms 329,542,378 3902.10.00 Polypropylene, in primary forms kilograms 271,201,880 3904.10.00 Polyvinyl chloride, not mixed with any other substances, in primary forms kilograms 188,800,413 2902.44.00 Mixed xylene isomers liters 746,072 2905.12.00 Propan-1-ol (Propyl alcohol) and Propan-2-ol (isopropyl alcohol) kilograms 87,805,095 3901.30.60 Ethylene-vinyl acetate copolymers kilograms 71,372,396 Source: US International Trade Commission (ITC) IMPORTS FROM MEXICOMexico is not as large of a source of US petrochemical imports as Canada, but shipments from the country are still noteworthy. The following table lists some of the main plastics and chemicals that the US imported from Mexico in 2023. HTS PRODUCT MEASUREMENT VOLUMES 2917.36.00 Terephthalic acid and its salts kilograms 69,230,708 3901.10.50 Polyethylene having a specific gravity of less than 0.94, in primary forms kilograms 34,674,435 2915.24.00 Acetic anhydride kilograms 25,294,318 3904.10.00 Polyvinyl chloride, not mixed with any other substances, in primary forms kilograms 24,005,371 2915.31.00 Ethyl acetate kilograms 18,855,544 3901.20.50 Polyethylene having a specific gravity of 0.94 or more, in primary forms kilograms 14,469,582 3902.10.00 Polypropylene, in primary forms kilograms 8,849,478 Source: US International Trade Commission (ITC) IMPORTS FROM CHINAChina remains a significant source for a couple of noteworthy chemicals despite the effects of the tariffs that US President Donald Trump imposed during his first term in office. The following table shows 2023 US imports from China. HTS PRODUCT MEASUREMENT VOLUMES 29152100 Acetic acid kilograms 21,095,566 39093100 Poly(methylene phenyl isocyanate) (crude MDI, polymeric MDI) kilograms 206,642,886 Source: US International Trade Commission (ITC) China's shipments of plastics goods are more significant. OIL TARIFFS WILL HIT US REFINERSCanada and Mexico are the largest sources of imported crude oil in the US, and the heavier grades from these countries complement the lighter grades that the US produces in abundance. Those imports help fill out refining units that process heavier crude fractions, such as hydrocrackers, cokers, base oil units and fluid catalytic cracking (FCC) units. Refiners cannot swap out heavier Canadian and Mexican grades with lighter US grades. Instead, they will need to pay the tariffs or find another supplier of heavier grades, possibly at a higher cost. The following table shows the largest sources of imported crude in 2023. Figures are listed in thousands of barrels/day. COUNTRY IMPORTS % Canada 3,885 59.9 Mexico 733 11.3 Saudi Arabia 349 5.4 Iraq 213 3.3 Colombia 202 3.1 Total US imports 6,489 Source: Energy Information Administration (EIA) US refiners could take another hit from higher catalyst costs. These are made from rare earth elements, and China remains a key source. TARIFFS TO RAISE COSTS FOR FERTILIZERCanada is the world's largest producer of potash, and it exports massive amounts to the US. It is unclear how the US could find another source. Russia and Belarus are the world's second and third largest potash producers. Together, the three accounted for 65.9% of global potash production in 2023, according to the Canadian government. Canada accounts for significant shares of other US imports of fertilizers. The following table lists some of Canada's fertilizer shipments to the US in 2023 and shows its share of total US imports. Figures are from 2023. HTS PRODUCT MEASUREMENT VOLUME % 31042000 Potassium chloride metric tonne 11850925 88.8 31023000 Ammonium nitrate, whether or not in aqueous solution metric tonne 295438 76.6 31024000 Mixtures of ammonium nitrate with calcium carbonate or other inorganic nonfertilizing substances metric tonne 29203 75.7 31055100 Mineral or chemical fertilizers, containing nitrates and phosphates metric tonne 1580 66.1 31022100 Ammonium sulfate metric tonne 947140 49.6 31052000 Mineral or chemical fertilizers, containing the three fertilizing elements nitrogen, phosphorus and potassium metric tonne 147850 41.4 Source: US ITC SUPPLY CHAIN SNARLSIf US companies choose to avoid the tariffs and seek other suppliers, they could be exposed to delays and supply chain constraints. Other companies outside of the petrochemical, plastic and fertilizer industries will also be seeking new suppliers. The scale of these disruptions could be significant because Canada, Mexico and China are the largest trading partners in the US. The following table lists the top 10 US trading partners in 2023 based on combined imports and exports. Country Total Exports ($) General Imports ($) TOTAL Mexico 322,742,472,406 475,215,965,697 797,958,438,103 Canada 354,355,997,349 418,618,659,183 772,974,656,532 China 147,777,767,493 426,885,009,750 574,662,777,243 Germany 76,697,761,127 159,272,068,221 235,969,829,348 Japan 75,683,130,214 147,238,042,342 222,921,172,556 South Korea 65,056,093,590 116,154,470,335 181,210,563,925 UK 74,315,228,810 64,217,031,774 138,532,260,584 Taiwan 39,956,725,574 87,767,403,487 127,724,129,061 Vietnam 9,842,922,146 114,426,076,081 124,268,998,227 Source: US ITC RETALIATIONUS petrochemical exports would be tempting targets for retaliation because of their magnitude and the global capacity glut. China, in particular, could impose tariffs on US chemical imports and offset the disruptions by increasing rates at under-utilized plants. So far, none announced plans to target chemicals on Sunday. Canada's plans to impose 25% tariffs on $30 billion in US goods does not include oil, refined products, chemicals or plastics. That batch of tariffs will take place on February 4. Canada will impose 25% tariffs on an additional $125 billion worth of US goods following a 21-day comment period, it said. The government did not highlight plastics or chemicals in this second batch of tariffs. Instead, it said the tariffs will cover passenger vehicles and trucks, including electric vehicles, steel and aluminium products, certain fruits and vegetables, aerospace products, beef, pork, dairy, trucks and buses, recreational vehicles and recreational boats. In a statement issued on Sunday, Mexico's president made no mention of retaliatory tariffs. Instead, she said she will provide more details about Mexico's response on Monday. China said it will start legal proceedings through the World Trade Organization (WTO) and take corresponding countermeasures. RATIONALE BEHIND THE TARIFFSThe US imposed the tariffs under the nation's International Emergency Economic Powers Act (IEEPA), which gives the president authority to take actions to address a severe national security threat. In a fact sheet, Trump cited illegal immigration and illicit drugs. Saturday's executive order is the first time that a US president imposed tariffs under IEEPA. Prior IEEPA actions lasted an average of nine years. They can be terminated by a vote in Congress. Insight article by Al Greenwood (Thumbnail shows containers, in which goods are commonly shipped. Image by Shutterstock)

03-Feb-2025

Dow to face margin pressure in Q1 with no help from macros – execs

NEW YORK (ICIS)–Dow expects to face sales and margin pressures in Q1 2025 with no improvement in the macro outlook following a difficult Q4, senior executives said. Dow expects Q1 earnings before interest, tax, depreciation and amortization (EBITDA) of around $1 billion – down $200 million from Q4 – on higher feedstock and energy costs, and higher maintenance activity. On the top line, sales in Q1 are expected to be down 2-4% versus Q4 in Packaging and Specialty Plastics (P&SP), down 2-4% in Industrial Intermediates & Infrastructure (II&I) but up 3-7% in Performance Materials & Coatings (PM&C). Overall Dow sales are expected to decline in Q1 versus Q4 as the declines in the first two segments outweigh the positive impact expected in the third – an unusual occurrence as Q4 is seasonally the weakest period. Q1 guidance does not include any impact from the January winter storm in the US Gulf Coast as Dow’s sites managed well through the event. The 2025 outlook also appears challenging. “While global GDP [in 2025] is expected to grow at similar levels to 2024, recent economic activity is primarily being led by strength in service-related sectors,” said Jeff Tate, Dow CFO, on the company’s Q4 earnings call. “Ongoing affordability challenges also continue to pressure spending in housing and durable goods sectors. These dynamics have created a two-speed economy,” he added. Dow is also monitoring any impacts from ongoing geopolitical volatility, including potential tariffs, he noted. Q4 RESULTS DOWN Dow’s Q4 2024 sales were down 2% year on year to $10.4 billion with volumes up 1% and local price down 3%. Operating earnings before interest and tax (EBIT) fell 19% to $454 million. “We’ve shown five consecutive quarters of [year-on-year] volume growth so we’re still going to take advantage of our low cost position and get our share, but pricing power is the real question,” said Dow CEO Jim Fitterling. On the positive side, ethylene chain – Packaging and Specialty Plastics (P&SP) and ethylene oxide (EO) and derivatives – demand continues to be strong, he said. NEW $1 BILLION RESTRUCTURING Underlying the overall difficult outlook for 2025, Dow is taking further actions to cut costs by $1 billion, including the elimination of 1,500 jobs. Capital spending (capex) will also be reduced by $300-500 million from prior guidance of $3.5 billion. The company also plans to idle a cracker in Terneuzen, the Netherlands, in Q2 until market conditions improve, and will provide an update on its European asset footprint review which focuses on polyurethanes (PU) by mid-2025. Any cost reductions from the European asset review will be in addition to the $1 billion in cost cuts just announced, said Fitterling. HOUSING AND AUTO MACROS PRESSURE PU Dow’s PU and construction chemicals businesses will remain under pressure in Q1 on housing headwinds. “We’re not really seeing any signs of demand recovery despite the interest rate cuts in the US and Europe,” said Dow chief operating officer (COO) Karen Carter, who noted end markets being impacted such as bedding and furniture, along with housing itself. “If you think about US home affordability, it remains at historic lows with [mortgage] rates above 7%. We also saw in Q4 automotive start to slow,” she added, noting that US auto inventories are at 10-year highs. In 2024, global automotive production started strong and ramped up through mid-year and then slowed on inventory pull-downs, said Fitterling. “You could see something similar this year where automotive starts strong again. We just have to keep an eye on what happens to inventories and demand,” he said. Focus article by Joseph Chang

30-Jan-2025

INSIGHT: Argentina’s chemicals, manufacturing could be collateral victims of liberalization push

SAO PAULO (ICIS)–Argentina’s cabinet drive to shift the economy from staunch protectionism into liberal bastion is increasing fears among chemicals and wider manufacturing players that the country’s beleaguered industrial fabric is yet to suffer further losses in output in coming years. As production costs in Argentina remain higher than in key manufacturing hubs such as China and the US, industrialists fear the country’s battle against inflation – the number one priority of Javier Milei’s administration – is to increase liberalizing measures that could hurt domestic industrial producers. This week, Argentina’s largest industrial trade group, the UIA, called on the government to make use of antidumping duties (ADDs) to protect the country’s manufacturers against unfair competition. The call for an increased use of ADDs comes as the cabinet lowers import taxes, so cheaper production from abroad can make its way to Argentina and, ultimately, lower prices for consumers: winning the battle against inflation will mark Milei’s term, and he is decided to win that battle, at any cost. Consumers may end up being winners in the equation, rightly so after the country’s crisis pushed more than 50% of Argentinians into poverty, according to official figures. But where there are winners, there are losers and, increasingly, chemicals and manufacturing players fear they will on that side of the equation. CHEAP IMPORTS, POTENTIAL PLANT SHUTDOWNSMacroeconomically, Argentina has turned a corner, and consumers are starting to buy into the recovery narrative. This week, the country’s statistics office Indec said output rose in November, both year on year and month on month, although the petrochemicals-intensive manufacturing and construction continued contracting. Moreover, two much-followed indicators compiled by Buenos Aires’ University Torcuato Luca di Tena showed positive trends: consumer confidence is up and, most importantly, its so-called Leading Indicator compiling ten different economic data sources, was showing the economy had entered an “expansionary phase” in the last quarter of 2024. The annual rate of inflation has more than halved in the past twelve months, standing at nearly 118% in December but down from its peak at nearly 300% in mid-2024. The state posted fiscal surpluses in some months of 2024, something unheard of in Argentina for decades, and squeezed consumers are holding off showing their pain in the streets, a well-established tradition in the country. So far, the majority still buys Milei’s disruptive narrative, aware the previous corruption-prone, protectionist system was unsustainable. The overall upbeat mood has made some in the chemicals industry hopeful that sooner rather than later they will also ride the recovery wave. Others, however, are turning increasingly pessimistic about a liberalized economy in which smaller chemicals players will have it very difficult to survive the current global oversupply. In an interview with ICIS this week, Manuel Diaz, the director general at Buenos Aires-headquartered trade group the Latin American Petrochemical and Chemical Association (APLA) and an Argentinian national himself, said the country’s progress in bringing down both inflation and the fiscal deficit has been remarkable. He conceded, however, many chemical companies in the country are now analyzing their outlook as the new liberalizing policies are to force them to adapt to global competition, which was not a factor in the previous protectionist system. There have already been some plant closures. At the end of 2024, US chemicals major Dow, who is the sole producer of polyethylene (PE) in Argentina, shut its polyols plant in San Lorenzo, citing global competitiveness issues. Local producer Rio Tercero’s shut its toluene di-isocyanate (TDI) plant in Cordoba arguing the same. APLA’s Diaz said there could be other plant closures in coming quarters, but they would affect small facilities which are uncompetitive in the global market, but he remained confident about larger facilities, which should weather the storm and come out on the other side still functioning and profitable. “Overall economic expectations are turning positive. In chemicals, the plant closures we have seen in Argentina is something we can also see in other markets, such as Europe. But in Argentina’s case, I think more plant closures will be contained to small facilities whose global competitiveness is difficult with higher production costs,” said Diaz. “In general, companies will try to accommodate a new reality, and I am confident many will be able to do that. Moreover, let’s look ahead: with crude and gas output from the Vaca Muerta fields expected to increase, there is a big potential for chemicals. Also for some fertilizers such as urea.” Diaz’s optimistic assessment is not shared by all other chemicals and wider manufacturing players. In its call this week for a larger use of ADDs to protect domestic production, industrial trade group UIA highlighted how small- and medium-sized enterprises (SMEs) would need extra protection from global markets if they are to keep their activity. Some of those SMEs would be the small chemicals plants Diaz was referring to. According to the UIA, Argentina currently has 94 ADDs in place, 50 of which are directed at products from China. Globally, Argentina occupies the sixth place in terms of ADDs in place, with 5.6% of the total. The country is behind the US (21.5% of the total), India (14.3%), Brazil (7.1%), Turkey (5.9%), and China (5.7%). Meanwhile, a third of total ADDs in the world are directed at China, according to the UIA figures. The 94 ADDs in place in Argentina are still a reminiscence of the previous protectionist system: Milei's intended plans to turn the economy around will be a years-long process. If the President succeeds, it would amount to a “regime change” economically, said metaphorically an economist at Buenos Aires-headquartered Fundacion Capital in an interview with ICIS last year. While the UIA praised changes passed this week by the cabinet simplifying the ADDs application procedures for companies, it also said that without them many companies may go out of business in the current global oversupplied markets for industrial goods. “These tools are essential to combat unfair competition. The impact of these measures is crucial for local SMEs, which face significant challenges, including one of the highest tax burdens in the world, high logistics costs, and difficulties in accessing competitive financing,” said the UIA. “In contrast, products imported from certain countries reach the local market with falsified prices, subsidized at their origin, and with lower labor costs. This situation generates unfair competition that threatens the sustainability of the national industry. “In developed economies such as the US and the EU, these tools have proven effective in protecting local investment and employment.” BUCKING THE TRENDThe 2020s will be remembered by chemicals players as a time of global oversupply which plunged the industry into a years-long downturn. And China will be at the center of those memories, as the country turned from chemicals importer to net exporter – and doing so with distorted trade practices which helped it dampen its excess product abroad. For a couple of years now, Latin America has been at the centre of this global oversupply. The region’s chemicals production can only cover around 50% of its demand, so Latin America’s trade deficit in chemicals makes the region a ‘price taker’ at the mercy of global markets. A prime target, therefore, for Chinese state-controlled, heavily subsidized chemicals producers. The region’s two largest economies, Brazil and Mexico, are large users of ADDs to protect their domestic industries. As observed in the UIA data on ADDs, Brazil is the third country globally with most ADDs in place (7.1%) but Mexico also featured high on the list, in ninth place with 3.8% of the total. The EU and Canada were in seventh and eighth place, with 5.5% and 4.9% of the total, respectively. Amid a rise in protectionism best reflected by the return of Donald Trump to the US presidency, Argentina is bucking the trend aiming to be the champion of liberal policies. The country tried something similar in the 1990s under Carlos Menem’s presidency, an experiment which did not end up well. The current push for liberalization has so far come with a key factor which did not happen in the 1990s: public sector spending is sharply down as Milei aims to trim down the size of state. That was a key factor in 2024 to dampen demand. It remains to be seen whether a more liberalized economy set to be based in services will leave any room for some industry to thrive in Argentina. Chemicals-wise, the country has the advantage of feedstock, but the full benefits of Vaca Muerta will take some years to bear fruit. In the interregnum, many chemical sources fear they may go out of business permanently. Sources who deal with cabinet officials have said to ICIS that when the officials are pushed on how local manufacturing production may suffer under liberalization measures, their response is always the same: in a free market, those who cannot compete should not be in the market. This week, Milei said he would withdraw Argentina from the free trade bloc Mercosur with Bolivia, Brazil, Paraguay, and Urugay if that was a necessary condition to sign a free trade deal with the US. Milei is Latin America’s most staunch supporter of President Trump, although economically their agendas diverge greatly. Milei has in the past referred to Mercosur’s trading rules as having “become a prison” which dwarfs competition. This week, asked in an interview with Bloomberg if he would be willing to leave the bloc, he said: "If that was the extreme condition [to sign other trade deals], yes. There are, however, mechanisms by which it can be done being within Mercosur. So, we say it can be achieved without having to abandon what we have in terms of Mercosur." Mercosur and the 27-country EU signed in December a free trade agreement after more than 20 years in the making which would create a 700-million consumer free trade area. The deal, however, still has to be fully ratified after it sparked protests among some economic sectors, mostly in the EU, such as farmers. The cabinet officials' reasoning about uncompetitive companies going bust in a true free market leaves chemicals sources perplexed and disappointed, but after one year of Milei firmly installed in the Casa Rosada presidential palace, players are starting to assume they may need to change their business model – less production and more trading and/or distribution, for example – if their companies are to survive. “In the next few years, Argentina’s economy will do very well, but not everyone will do well. Exports-wise, oil and gas, mining, or agriculture will boom. Those with stable jobs will be fine, merchants will be fine, importers will be fine, but clearly industrialists will not be fine,” said a chemicals source in Buenos Aires this week. “Industrialists will suffer because the Argentine government has not yet lowered any of the production costs, be it taxes or costs of the corporatist inefficiency that exists in Argentina, and that makes it difficult for them to compete against imported products that are so cheap. “In other words, I think that industry will suffer in coming years and destroy employment. But employment is not part of the conversation today: it’s all about inflation. Until employment is not part of public opinion’s concerns, the government believes it can ride the wave and win the next election. But, along the way, I fear industrial fabric is set to be lost.” Insight by Jonathan Lopez

24-Jan-2025

India petrochemical prices rise as rupee tumbles to all-time low

SINGAPORE (ICIS)–India’s currency – the rupee – slumped to a record low in the week, pushing up both domestic and import prices of some petrochemicals in the south Asian country amid stable demand. Strong US dollar sends Indian rupee tumbling Acetone, EVA import prices jump India inflation within central bank target range The Indian rupee (Rs) is currently trading at above Rs86 against the US dollar, having shed more than 3% since the early November, when Donald Trump won the US election. At 07:10 GMT, the rupee was trading at Rs86.49. A strong US dollar and heavy outflows of short-term investments sent the currency tumbled to a record low of Rs86.9964 on 14 January, according to foreign exchange platform xe.com. India’s demand for overseas goods will likely be dented as a weaker currency makes imports more expensive. PETROCHEMICAL BUYERS TURN CAUTIOUS With import prices of several products on uptrend amid the rupee weakness, some buyers have adopted a wait-and-see attitude on markets. India is a major importer of petrochemicals including polymers. Rupee’s tumble has notably adversely affected PE Black 100 pipe import offers from Gulf Cooperation Council (GCC) and Asian sellers as buyers switch to domestic PE Natural. PE Black 100 and PE Natural are specific grades of high-density polyethylene (HDPE) used primarily for high pressure water pipes. In the recycled polyethylene (rPE) and recycled polypropylene (rPP) markets, downstream converters in India that import cargoes from northeast Asia are feeling the pinch. Fewer India-bound rPE and rPP cargoes are expected in the coming weeks, compounded by high intra-Asia freight rates. For exporters of recycled polyethylene terephthalate (rPET), meanwhile, there was no upsurge in shipments despite the rupee’s weakness. India continues to position itself as net exporter of rPET cargoes,  mainly bound to long-haul buyers in the Americas and in Europe. India’s aggressive expansion of rPET materials have posed competition to other Asian producers, particularly those in southeast Asia. In the toluene di-isocyanate (TDI) and ethanolamines markets, market sentiment is mixed. “Import and domestic prices for India TDI are unchanged from last week, but sentiment is mixed due to positive demand versus the weak rupee/US dollar rate,” a market player said. TDI is primarily used in the production of flexible polyurethane foams, which are widely used in furniture, bedding, and automotive seating. Meanwhile, after several months of decline, ethanolamines’ domestic prices moved higher, with players attributing the sudden rebound on the steep devaluation of the rupee, while demand was stable. For ethylene vinyl acetate (EVA) and acetone, import and domestic prices have spiked while demand was stable. EVA restocking momentum and discussions have been weighed down by the falling rupee due to higher cost of imports, market players said. “I have not booked yet because of the currency depreciation; import costs have gone up so it has really impacted importers… we'll wait for negotiations with suppliers,” said a distributor. For acetone, fresh import demand is being hampered by the weak rupee amid a prevailing supply surplus in the Indian domestic market. US DOLLAR TO REMAIN STRONG The US dollar remains strong on better-than-expected job growth in the world’s largest economy, while the unemployment rate fell to 4.1%, reducing the chances of interest rate cuts by the Federal Reserve in February. A weaker currency fuels inflation as it raises the cost of imported goods. “The RBI intervened extensively in the FX market last year but the appointment of a new central bank governor last month has raised market expectations of a less active intervention approach to smooth the rupee’s volatility,” Netherlands-based banking and financial service firm ING said in a note on 13 January. “The recent equity market correction, foreign institutional investor (FII) outflows and overvaluation of the Indian rupee suggest that the rupee will continue to face downward pressure in the near term,” ING added. DEC INFLATION EASES; NOV INDUSTRIAL OUTPUT UP 5% India’s inflation rate eased to a four-month low of 5.22% in December from 5.48% in the previous month, continuing its decline from 6.21% recorded in October, official data showed. The December figure was within the 2.0% to 6.0% tolerance band set by the Reserve Bank of India (RBI). Easing food prices had some analysts predicting a possible cut in RBI’s repurchase rate as early as February, but the weakness of the rupee could delay adoption of a looser monetary policy. “We maintain our base case for RBI to begin monetary policy easing via a 25 bps points reduction to the repo rate in the upcoming Feb 2025 … meeting,” Singapore-based UOB Global Economics & Markets Research analysts said in a 14 January macro note. Meanwhile, India’s factory output in November, as measured through the Index of Industrial Production (IIP), rose 5.2% year on year driven by growth in manufacturing activity and power generation. Manufacturing output growth in November accelerated to 5.8% year on year from 1.3% in the same period last year. In April to November 2025, industrial output posted a slower year-on-year growth of 4.1% from 6.5% in the previous corresponding period. India, which is a giant emerging market in Asia, is expected to post a slower GDP growth of 6.6% in the fiscal year ending March 2024, down from 7.2% in the previous year, based on RBI’s projections. Nonetheless, India is still predicted to be the fastest-growing country in Asia, according to ING, which forecasts 6.8% growth for India for the current fiscal year. Focus article by Jonathan Yee Additional reporting by Helen Lee, Clive Ong, Shannen Ng, Veena Pathare, Nadim Salamoun and Arianne Perez Thumbnail image: Indian rupee notes – 5 January 2025 (Firdous Nazir/NurPhoto/Shutterstock)

16-Jan-2025

Summary of 2025 Americas Outlook Stories

HOUSTON (ICIS)–Here are the 2025 Americas Outlook stories which ran on ICIS news from 23 December 2024 to 3 January 2025. Click on a headline to read the full story. OUTLOOK ’25: LatAm chemicals pessimism persists as downturn could last to 2030 For many players within Latin America petrochemicals, 2025 will only be one more stop on the long downturn journey as, for many, the market’s rebalancing will only take place towards the end of the decade. OUTLOOK '25: LatAm PE demand could finally improve from Q2 onwards Latin American polyethylene (PE) demand should start slowly in 2025, but it could take a decisive turn for the better from Q2 onwards. OUTLOOK '25: LatAm PP supply to remain long amid squeezed margins Latin America polypropylene (PP) is expected to remain oversupplied in the first half of 2025, with producers’ margins likely to remain squeezed. OUTLOOK ’25: US economy poised for ‘solid landing’ in 2025, giving chemicals a shot at recovery For all the talk about a soft landing for the US economy, it’s looking more like a “solid landing” for 2025 with GDP growth higher than 2% for the fifth consecutive year as the labor market remains healthy and consumer spending resilient. OUTLOOK '25: US NGL demand to rebound moderately Though demand for US natural gas liquids (NGLs) is relatively low heading into 2025 due to a general inventory glut, various industry and environmental conditions have feedstocks poised for a moderate demand rebound in 2025. OUTLOOK ’25: Supply concerns will drive US ethylene market entering new year Supply concerns will dominate the US ethylene market heading into 2025 as it enters an unusually heavy turnaround season. As many as 10 crackers along the US Gulf Coast are going down for planned maintenance during Q1 and Q2. OUTLOOK '25: US BD poised for demand, export growth as production stabilizes, grows US butadiene (BD) supplies are rebuilding at the start of 2025 as outages which limited production in 2024 are resolved, while both exports and demand are expected to grow in the new year. OUTLOOK '25: US R-PE to see both demand extremes between high cost food-grade PCR and low cost PIR US recycled polyethylene (R-PE) markets continue to see extreme disparity between sustainability-driven and cost-sensitive grades of both post-consumer and post-industrial recycled high-density polyethylene (R-HDPE) and recycled low-density polyethylene (R-LDPE). This is expected to persist into 2025. OUTLOOK '25: US PP navigating mediocre growth and oversupply US polypropylene (PP) is expected to be relatively less volatile in 2025, following a year where prices changed every month. Higher propylene inventory levels and improved supply expected to stabilize supply/demand dynamics. OUTLOOK '25: US ACN demand weakness to continue amid oversupply The three-year demand decline in US acrylonitrile (ACN) markets may continue well into 2025. OUTLOOK ’25: US chem tanker market growth to support favorable rates; container market readies for port labor issues, tariffs Growth in the US liquid chemical tanker market is likely to support favorable rates in 2025, while the container shipping market could see upward pressure from possible labor strife at US Gulf and East Coast ports and proposed tariffs on Chinese imports. OUTLOOK '25: Lackluster US aromatics demand, rising inventories pressure benzene and toluene After peaking in Q1 2024, benzene prices have declined through the latter half of the year, due to soft derivative demand. OUTLOOK ’25: US styrene market facing weak demand, overcapacity The US styrene market enters the new year facing sluggish demand, poor margins, and low operating rates. With a light maintenance season ahead, the market’s fate will be driven largely by derivative demand, which continues to face challenging headwinds. OUTLOOK '25: US PS, EPS demand to remain soft Demand for US polystyrene (PS) is expected to remain soft into the next year with weak downstream markets, polymer recycling regulations and overall expectations of a smaller growth in the economy for 2025 compared with 2024. OUTLOOK '25: Ample LatAm PS supply meets poor demand The Latin American polystyrene (PS) market will continue facing headwinds in 2025 on the back of weak demand across the region combined with plentiful supply. OUTLOOK '25: US PET demand expected higher but supply disruptions, tariffs remain risks Demand for US polyethylene terephthalate (PET) should increase in 2025 if lower inflation and interest rates drive consumption with stronger growth expected in the second half of the year, but the possibilities of a trade war or supply disruption in upstream purified terephthalate acid (PTA) remain concerns. OUTLOOK '25: LatAm PET prices pressured by economic challenges, tariff shifts Polyethylene terephthalate (PET) prices in Latin America are expected to soften in H1 2025, driven by changes in import tariffs, lower Asia prices and easing freight rates. OUTLOOK '25: US BDO demand to strengthen on lower inflation but EV policy, tariffs may be headwinds US butanediol (BDO) demand is expected to strengthen in 2025 amid more controlled inflation and lower interest rates, but possible tariffs and changes to electric vehicle (EV) policies could be challenges. OUTLOOK '25: US caustic soda trajectory to be impacted by PVC length, tariffs The US caustic soda market in the latter half of 2024 was shaped by a combination of supply disruptions and shifting demand dynamics on the chlorine side of the molecule. OUTLOOK '25: US PVC faces oversupply, export challenges The US polyvinyl chloride (PVC) market is set to face significant headwinds in 2025, entering the year with abundant inventories, expanded production capacity and constrained export opportunities. The confluence of these factors points to a challenging landscape for producers as they navigate both domestic and international market pressures. OUTLOOK '25: Latin America PVC market faces challenges from tariffs and instability in H1 Polyvinyl chloride (PVC) prices in Latin America are expected to fluctuate in H1 due to various regional challenges. OUTLOOK '25: US soda ash facing subdued demand US soda ash is facing subdued demand going into 2025 as commercial discussions wrap up. OUTLOOK '25: US R-PET expects strong beverage demand amid international risk Though the build up to 2025 has been tumultuous, the US recycled polyethylene terephthalate (R-PET) market holds both optimism and distrust that the year will keep to its original promise. OUTLOOK '25: US nylon demand weak amid manufacturing contraction Demand declines in US nylon markets which started in Q3 2022 will continue well into H2 2025. Demand was weak in multiple application sectors including automotive, industrial, textiles, electrical and electronics. The only application sectors that performed well were packaging and medical. OUTLOOK ’25: US phenol/acetone production to remain curtailed on soft demand US phenol demand will likely remain soft and weigh on acetone supply in H1 2025 as expectations for a rebound are tempered. OUTLOOK '25: US MMA anticipating new supply in new year US methyl methacrylate (MMA) players are trying to gauge supply and demand dynamics amid heightened volatility going into 2025. OUTLOOK '25: US ABS, PC look to remain pressured with weakened markets Demand for acrylonitrile butadiene styrene (ABS) and polycarbonate (PC) are expected to remain stagnant in 2025 compared with 2024 with industries like automotive, household appliances and housing markets not expecting to see increases. OUTLOOK '25: US polyurethanes brace for Asia overcapacity and US weak demand The 2025 outlook for polyurethane (PU) products in the US is marked by the expectation of a very slow economic recovery, constrained feedstock costs, an overcapacity of methylene diphenyl diisocyanate (MDI) and polyols built in Asia, possible labor strikes, increases in tariffs and ongoing issues with the Red Sea’s route. OUTLOOK '25: US PG, UPR face pressure from propylene; mild optimism for H2 demand boost remains While recent sharp declines in propylene have led to lower prices for propylene glycol (PG) in Q4 2024, the extent of the drops has been moderated by buyer interest in winter applications. OUTLOOK '25: US acetic acid, VAM exports expected stronger, domestic demand could rise US acetic acid and vinyl acetate monomer (VAM) supply heading into 2025 is improving after production outages resolved, while tight global supply is expected to boost export demand and lower inflation may lead to stronger domestic demand. OUTLOOK '25: US PA remains sufficiently supplied even with capacity reduction US phthalic anhydride (PA) supply will tighten in 2025 with the announced exit of a major domestic producer. Supply is expected to be sufficient to meet current demand levels, but any future demand improvement is likely to require support from increased imports. OUTLOOK '25: US MA facing muted demand expectations US maleic anhydride (MA) is facing tempered expectations for a rebound in demand going into 2025. OUTLOOK '25: US EG/EO demand expected higher in 2025; turnarounds to tighten Q1 supply Demand for US ethylene glycol (EG) and ethylene oxide (EO) should increase in 2025 on restocking and if lower inflation drives consumption, but this may be met with tight supply in Q1 due to plant maintenance. OUTLOOK ’25: US IPA to track upstream propylene; MEK focus on Shell’s plant closure US isopropanol (IPA) supply and demand are expected to be balanced in the first half of 2025 with price movements tracking upstream propylene. Meanwhile, the biggest issue facing the methyl ethyl ketone (MEK) market next year is the decision by Shell to shutter its production facility in the Netherlands in the first half of the year. OUTLOOK '25: US melamine to see consequences from US antidumping ruling The antidumping (AD) and countervailing duty (CVD) petitions filed by Cornerstone on 14 February 2024 against melamine imports from Germany, India, Japan, the Netherlands, Qatar, and Trinidad and Tobago led to an investigation from the United States International Trade Commission (US ITC) that is slated to impact the melamine industry at large in 2025. OUTLOOK '25: US President Trump could move quickly on tariffs, deregulation As US president, Donald Trump could quickly proceed on campaign promises to impose tariffs and cut regulations after taking office on 20 January. OUTLOOK '25: US base oils seek to manage new normal amid oversupply, demand deterioration Oversupply relative to weak base oil demand is likely to persist into a third year — this year with less optimism for significant domestic demand recovery in automotive and headwinds from additional supply entering the global marketplace. OUTLOOK '25: Squeezed import margins leave US oleochemicals markets vulnerable to supply disruptions in H1 Squeezed import margins leave US fatty acids and alcohols markets vulnerable to supply disruptions in H1 against the backdrop of a sharp increase in feedstock costs across the oil palm complex over the last quarter and sustained import logistics bottlenecks in the wider market. OUTLOOK '25: US H1 glycerine markets to remain relatively tight amid squeezed biodiesel margins, import bottlenecks US H1 glycerine markets are expected to remain relatively tight in H1 as anticipated weaker-than-normal soy methyl ester (SME) production in Q1 stemming from pending changes to domestic biodiesel tax incentives against the backdrop of sustained import logistics bottlenecks create short-term supply gaps in kosher crude glycerine supplies. OUTLOOK '25: US epoxy resins grappling with duty, logistics, demand issues US epoxy resins players are trying to formulate a strategy for 2025 in light of duty investigations and guarded sentiment on demand. OUTLOOK '25: US oxo-alcohols, acrylates, plasticizers see falling feedstocks, softening demand, as market eyes potential tariffs Following declines in feedstock prices in the autumn and start of winter, oxo-alcohols, acrylate, and plasticizers continue to face demand headwinds. OUTLOOK '25: US etac supply concerns emerge; butac, glycol ethers supply more stable but feedstock costs fall After relative stability in H1 2024, a sharp drop in feedstock prices of butyl acetate (butac) and some glycol ethers have led to volatility in US spot and contract prices in the latter half of the year. While notable declines in upstream costs have not been seen in ethyl acetate (etac) markets, there are ongoing concerns that proposed tariffs on material produced in Mexico may impact domestic availability in 2025. OUTLOOK '25: Brazil ethanol production strong; market watches forex, Combustivel do Futuro, RenovaBio The Brazilian ethanol market is facing robust domestic production and evolving global energy policies. As Brazil continues to position itself as one of the leaders in renewable energy, initiatives like Combustivel do Futuro and RenovaBio are set to play a crucial role in driving growth. OUTLOOK '25: US methanol supply expected tight in Q1, demand may pick up mid-year US methanol supply is tight heading into the new year, a situation that has been offset by lackluster demand, but demand is expected to pick up farther into 2025 if more controlled inflation and lower interest rates fuel consumer spending and the housing market. OUTLOOK '25: Gradual demand recovery anticipated for US TiO2 by H2 North American titanium dioxide (TiO2) demand is anticipated to gradually strengthen by H2 2025, especially if the US Federal Reserve continues to ease monetary policy.

13-Jan-2025

Events and training

Events

Build your networks and grow your business at ICIS’ industry-leading events. Hear from high-profile speakers on the issues, technologies and trends driving commodity markets.

Training

Keep up to date in today’s dynamic commodity markets with expert online and in-person training covering chemicals, fertilizers and energy markets.

Contact us

Partner with ICIS and unlock a vision of a future you can trust and achieve. We leverage our unrivalled network of chemicals industry experts to support our partners as they transact today and plan for tomorrow. Capitalise on opportunity in today’s dynamic and interconnected chemicals markets, with a comprehensive market view based on trusted data, insight and analytics.

Get in touch today to find out more.

READ MORE