TOPIC PAGE: Coronavirus, oil price crash – impact on chemicals

Author: Will Beacham


Asia naphtha prices are finding support from downstream markets, underpinning spot cargo premiums.

Naphtha prices were mostly taking cues from global crude oil futures as concerns of fresh coronavirus infections across the globe loom, which could thwart fuel demand.

China’s petrochemical markets mainly tracked crude oil in June with several chemicals saw lower prices as a result of weaker demand, a trend likely to continue months ahead.

As of 28 Jun, 19 out of the 33 petrochemical products tracked by ICIS China witnessed lower prices than at the beginning of the month while for the rest, almost a half saw limited price gains.

The ICIS China Petrochemical Index tracks movement of domestic prices of a wide array of organic and plastics products.

These include methanol, purified terephthalic acid (PTA), polypropylene (PP), polyethylene (PE), monoethylene glycol (MEG), mixed xylene, benzene, toluene, acetic acid, styrene, phenol, acrylonitrile, acetone, n-butanol, 2-ethylhexanol (2-EH), acrylic esters and propylene oxide (PO).

On this topic page we analyse the impact of coronavirus and the oil price collapse on chemical markets and bring together the latest news reported by ICIS. To visit the ICIS energy markets topic page, click here

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Asia naphtha draws support from sturdy demand; premiums firm
By Melanie Wee 2020/06/30 SINGAPORE (ICIS)--Asia naphtha prices are finding support from healthy downstream sectors, helping to underpin spot cargo premiums, with supportive near-term demand likely to be sustained.

Open-specification naphtha prices for first-half August averaged at $385/tonne CFR (cost and freight) Japan at early hours session on Tuesday, reversing the losses from the previous session on 29 June to climb by over $18/tonne.

PODCAST: Asia PX, PTA outlook fraught with challenges
By Jasmine Khoo 2020/06/30 SINGAPORE (ICIS)--Asia's paraxylene (PX) and purified terephthalic acid (PTA) markets are expected to face a persistent supply overhang on the back of new expansions amid a weak global macroeconomic environment.

In this episode of the ICIS Asia Podcast, Senior Editor Jasmine Khoo speaks with Samuel Wong, Senior Editor of the ICIS PX & PTA reports, on the latest market trends and their near term outlook.

US June propylene contracts settle at an increase amid production issues
By Michael Sims 2020/06/29 HOUSTON--US June propylene contracts settled at a 0.5 cent/lb increase from May, as spot prices rose amid production issues.The settlement puts June polymer-grade propylene (PGP) contracts at 26.5 cents/lb ($584/tonne) DEL (delivered) and chemical-grade propylene (CGP) at 25.0 cents/lb.

US chem shares rise amid upbeat aerospace, housing news
By Juhi Varma 2020/06/29 HOUSTON (ICIS)--US-listed shares of chemical companies rose with the general stock market on Monday, with positive news in aerospace and signs of a potential rebound in the housing market.

BP divests its aromatics, acetyls business to INEOS for $5bn
By Morgan Condon 2020/06/29 LONDON (ICIS)--BP has agreed to sell its globals petrochemicals assets in aromatics and acetyls to INEOS for $5bn, the two majors said on Monday.

Asia petrochemical shares, oil tumble as global virus cases exceed 10m
By Nurluqman Suratman 2020/06/29 SINGAPORE (ICIS)--Asian petrochemical shares tumbled along with oil prices on Monday as confirmed coronavirus cases across the globe surpassed 10m, with the US as the worst-hit country.

Tensions between the US and China over the proposed national security law for Hong Kong are also weighing on investor sentiment.

China MEG demand stable; oversupply to worsen on new capacities
By Cindy Qiu 2020/06/29 SINGAPORE (ICIS)--China’s monoethylene glycol (MEG) demand is largely steady amid ample supply, which is likely to get worse with new capacities coming on stream in the second half of the year.

The overall domestic market is weak as support from recent crude gains was being overshadowed by bearish supply-demand fundamentals.

US chem shares fall amid rising coronavirus cases
By Juhi Varma 2020/06/26 HOUSTON (ICIS)--Most US-listed shares of chemical companies fell steeply on Friday amid rising reports of new coronavirus infections from many states.

US BD markets are amply supplied, eyeing road to demand recovery
By Amanda Hay 2020/06/26 HOUSTON (ICIS)--Heading into July, US butadiene (BD) markets are amply supplied while demand has begun its road to recovery.

Signs of recovery for Europe chemicals industry on the horizon but near-term conditions remain weak
By Morgan Condon 2020/06/26 LONDON (ICIS)--Any recovery for the European chemicals sector is likely to be delayed until September, according to analysts from Baader Bank on Friday.

Thin liquidity extends in Asia styrene for the second consecutive week
By Trixie Yap 26-Jun-20 11:47 SINGAPORE (ICIS)--Thin liquidity in Asia's styrene monomer (SM) market was extended for the second consecutive week, ahead of the holidays in some parts of northeast Asia, with more activity expected in early July as conflicting market outlooks continue to be present.

Asia’s NBR demand likely to be sluggish in H2 2020 amid shrinking global economy
By Helen Yan 26-Jun-20 15:04 SINGAPORE (ICIS)--Asia’s acrylonitrile butadiene rubber (NBR) demand is likely to remain sluggish in the second half of this year on worries over the resurgence of the virus outbreak in the US and EU and a shrinking global economy. The downstream automotive industry is expected to take more time to recover, given the devastating impact of the coronavirus pandemic on the industry and the global economy.

US IPA spot market prices steady as supply gradually eases
By Deniz Koray 2020/06/25 HOUSTON (ICIS)--For the first time in more than three months, isopropanol (IPA) spot prices remained unchanged this week.

Braskem sees major PP export opportunities from new US Delta plant - CEO
By Joseph Chang 2020/06/25 NEW YORK (ICIS)--Braskem sees the opportunity to export a substantial amount of the polypropylene (PP) produced from its new 450,000 tonne/year Delta plant in La Porte, Texas, US, the CEO of Braskem America said on Thursday.

Europe Q3 methanol contract settles down €30/tonne at four-year low
By Eashani Chavda 2020/06/25 LONDON (ICIS)--The European methanol third-quarter contract price settled at €225/tonne, a decrease of €30/tonne from the previous quarter.

Asian petrochemical shares sharply lower on virus fears, IMF growth downgrades
By Nurluqman Suratman 2020/06/25 SINGAPORE (ICIS)--Asian petrochemical shares were sharply lower on Thursday amid renewed fears of a resurgence in coronavirus cases globally and after the International Monetary Fund (IMF) further slashed its growth forecasts.

Asia’s petrochemical trade slows ahead of holiday in China
By Nurluqman Suratman 2020/06/25 SINGAPORE (ICIS)--Asia's petrochemical trade mostly slowed down ahead of the Dragon Boat Festival holiday in China on 25-27 June, with sentiment in key feedstock markets also weighed by the recent decline in crude oil prices.

US fuel ethanol spot prices decline; Q3 industrial contracts under discussion
By Alex Snodgrass 2020/06/24 HOUSTON (ICIS)--US spot fuel ethanol prices fell this week as fears over a second wave of the coronavirus remain.

US chem shares plunge amid growing virus cases
By Al Greenwood 2020/06/24 HOUSTON (ICIS)--US-listed shares of chemical companies fell sharply, as several states continue to report rising number of coronavirus cases and hospitalisations.

Europe chems supply chains strengthen but pre-crisis conditions still in the distance
By Tom Brown 2020/06/24 LONDON (ICIS)--Activity along European chemicals supply chains is gradually reviving after the disruption of  of the coronavirus pandemic but pre-crisis operating conditions still remain a long way away, according to distributors' trade group FECC.

US VAM demand softness continues in export arena, inventories ample
By Anna Matherne 2020/06/23 HOUSTON (ICIS)--The US vinyl acetate monomer (VAM) export market continues to face weakened demand with readily available supplies, adding pressure during summer months.

VIDEO: US base oil postings rise on VGO
By Amanda Hay 2020/06/23 HOUSTON (ICIS)--Watch Senior Editor Amanda Hay discuss the fundamentals putting upward pressure on US base oils markets. Posted prices are up but demand has not yet recovered to pre-coronavirus levels.

ADM increases industrial ethanol production at US plant
By Alex Snodgrass 2020/06/23 HOUSTON (ICIS)-- US based ethanol producer Archer Daniels Midland is increasing production of industrial alcohol at its Clinton, Iowa, corn processing complex, the company said in a statement.

Europe plastics polymers 2020 output severely impacted by pandemic
By Yashas Mudumbai 2020/06/23 LONDON (ICIS)--Production of polymers used for plastics packaging are to be severely impacted in 2020 across Europe on the back of the coronavirus pandemic-induced lockdowns, according to forecasts by ICIS.

Asia's petrochemical demand recovery in limbo amid easing of restrictions
By Felicia Loo 2020/06/23 SINGAPORE (ICIS)--Asia’s petrochemical demand recovery is likely to be in limbo despite countries easing restrictions on their lockdowns, amid a resurgence of the coronavirus in Beijing.

Asia MX market ends seven-week rally amid long supply
By Keven Zhang 2020/06/23 SINGAPORE (ICIS)--Asia isomer-grade mixed xylenes (MX) has ended a seven-week price rally in the week ended 19 June, as the prompt market weakened with increasing supply.

Supply has increased due to reduced operating rates at downstream paraxylene (PX) plants, who were selling MX cargoes to the market.

Saudi Aramco to boost chem investment in Asia emerging markets
By Joseph Chang 2020/06/22 NEW YORK (ICIS)--Saudi Aramco will boost its chemicals investments in emerging economies, especially in Asia, the head of its downstream business told ICIS on Monday.

UK chems sentiment hit by pandemic, ‘increasing likelihood’ of no-deal Brexit
By Jonathan Lopez 2020/06/22 LONDON (ICIS)--The pandemic-induced lockdown and an ‘increasing likelihood” the UK will not reach an exit agreement with the EU have turned indicators sour for the country’s chemicals industry, according to the chemicals distributors trade group CBA.

Asia naphtha at over three-month high on demand; eyes on crude oil
By Melanie Wee 22-Jun-20 12:21 SINGAPORE (ICIS)--Asia naphtha prices have climbed to a fresh high in over three months, fuelled by demand for petrochemical production, although gasoline-blending demand could be more gradual, in part hinging on crude oil movements.

Spot naphtha prices are at their highest since 6 March at above $400/tonne CFR Japan, ICIS data shows. But concerns of rising coronavirus cases globally might serve to curb the upward momentum. In a similar vein, emerging coronavirus cases in the US could hamper fuel demand as a whole.

India's new anti-dumping duties on PS to shake up domestic market
By Prateek Pillai 22-Jun-20 17:30 SINGAPORE (ICIS)--India is set to soon impose new anti-dumping duties (ADD) on imported polystyrene (PS), a move which is expected to shake up the domestic market which has already been reeling from the effects of the coronavirus pandemic.

Last week the Indian government released the findings of its year-long anti-dumping duty (ADD) investigation into imported polystyrene (PS). The probe concluded that dumping had been taking place and advised duties ranging from $35 to $474 on cargoes from six origins — Iran, Singapore, Malaysia, Taiwan, the UAE and the US.

US phenol balanced as players look to H2 demand recovery
By Tarun Raizada 2020/06/19 HOUSTON (ICIS)--US phenol supply and demand are balanced as players turn their attention to H2 for demand recovery. There is some optimism as economic activity resumes, but the outlook is clouded.

Europe PE market skips pre-buying for July despite crude oil surge
By: Linda Naylor 2020/06/19 LONDON (ICIS)--There have been no signs of prebuying for July polyethylene (PE) in spite of the surge in crude oil prices which can reasonably be expected to have an impact on the upcoming ethylene monomer contract.

Brent crude was trading above $42/bbl early on Friday.

At times, PE pricing discussions for June have been tetchy, although not all of them have ben concluded because the practice of retroactive settlements is still rife at many large accounts.

In April and May, buyers were able to enjoy lower prices as the monthly upstream ethylene contract fell by a record amount. Only a portion of this was passed on to buyers, many of whom were struggling to cope with a surge in packaging demand as consumers panic bought goods in the early days of the pandemic.

VIDEO: Global PMMA sheet demand at historic highs on pandemic
By: Katherine Sale 2020/06/19 LONDON (ICIS)--ICIS Senior Editor for European polymethyl methacrylate (PMMA) Katherine Sale analyses how sheet demand remains at historic highs globally on booming demand for safety panels due to the pandemic.

- Lead times in Europe normalised

- Higher sheet demand to impact Q3 contract talks

- Wider market demand weak

Click on the headline to see the video.

VIDEO: Europe acrylate esters profitability concerns rife
By: Katherine Sale 2020/06/19 LONDON (ICIS)--ICIS Senior Editor for European acrylate esters and acrylic acid (AA) Katherine Sale analyses how margins have been compressed further in those markets after June contract settlement this week.

- Producers' concerns about profitability on the rise

- June margins compressed on higher propylene

- Do-it-yourself (DIY) paints demand booms, but wider demand soft

Click on the headline to see the video.

VIDEO: Europe MMA June contract targets diverge after 26-monthly drops
By: Katherine Sale 2020/06/19 LONDON (ICIS)--Europe Senior Editor for methyl methacrylate (MMA) Katherine Sale analyses how, after 26 months of falls, June contract targets have diverged.

- Spot stable following hikes in China

- June contract talks ongoing

- Overall demand soft

Click on the headline to see the video.

Asia's reopening supports demand for protective products raw materials
By Nurluqman Suratman 2020/06/19 SINGAPORE (ICIS)--Asian demand for chemical raw materials that go into protective barriers used to prevent coronavirus transmissions is expected to remain buoyant as more economies in the region reopen.

The uptick in demand for polymethyl methacrylate (PMMA) into acrylic sheets for transparent barriers is increasing in Asia as economies slowly reopen, with indications that this will continue for some time amid the ongoing pandemic.

India in protectionist mode; fast-tracks dumping probes on Chinese goods
By Priya Jestin 2020/06/19 MUMBAI (ICIS)--India is in the process of fast-tracking dumping investigations into more than 100 products from China to protect its domestic industries amid the coronavirus pandemic, continuing to treat the northeast Asian giant as a “non-market economy”.

By keeping China’s status as such, India can impose steep antidumping duties (ADDs) on Chinese products, government sources said.

US IPA demand sees weak increase amid growing regional coronavirus cases
By Deniz Koray 2020/06/18 HOUSTON (ICIS)--After seeing a gradual decrease in prices over the past two months, isopropanol (IPA) prices mostly held steady this week.

ICIS WEBINAR: Chems to see H2 demand pick up, but coronavirus challenges remain
By Stefan Baumgarten 2020/06/18 HOUSTON (ICIS)--US and European chemical producers will see sequential improvements in demand in H2 as economies emerge from the Q2 coronavirus (Covid-19) lockdowns and restrictions.

Chem M&A market starts thawing after Covid-19 freeze - banker
By Joseph Chang 2020/06/18 NEW YORK (ICIS)--Merger and acquisition (M&A) activity in the chemicals sector is starting to thaw after many processes were put on hold amid the Covid-19 crisis, an investment banker said.

Coronavirus pandemic offers chance for sustainable recovery - IEA
By: Tom Brown 2020/06/18 LONDON (ICIS)--The economic collapse caused by the coronavirus pandemic and the government investment programmes to galvanise recovery offer a “once in a lifetime” opportunity for policymakers to push global greenhouse gas emissions into decline, the executive director of the International Energy Agency (IEA) said on Thursday.

Integrating energy policy into government plans to reconstruct economies in the wake of the pandemic has the potential to realign the trajectory of global emissions levels without sacrificing economic growth, according to Fatih Birol.

Carbon dioxide (CO2) emissions have risen each year since world leaders signed the 2016 Paris Agreement intended to keep global temperature growth within two degrees centigrade, compared to pre-industrial levels, casting doubt on whether policymakers' will was strong enough to meet the goals.

Sasol raises debt ceiling, cuts jobs and launches newstrategy with chems at core

By: Will Beacham 2020/06/18 BARCELONA (ICIS)--South Africa’s Sasol hasraised its debt ceiling with lenders, plans toabandon oil activities in West Africa and cutjobs as the troubled company refocuses onspecialty chemicals, gas and renewables.

The company said on Thursday it has negotiated an increasein debt covenants from December from three-to-four times (3x, 4x) net debt in relation to earnings before interest, tax,depreciation and amortization (EBITDA). It was granted a waiver for its June covenant.

Sasol now has to prioritise debt reduction andhas agreed to no dividend payments oracquisitions while leverage remains above 3xnet debt/EBITDA.

The company’s credit rating was downgraded by two notches earlier this year, adding around $40m to annual interest payments.

Developing Asia '20 growth cut to 0.1%; SE Asia to contract 2.7% - ADB
By Nurluqman Suratman 18-Jun-20 11:52 SINGAPORE (ICIS)--The Asian Development Bank on Thursday cut its growth forecast for developing economies in Asia to 0.1%, down from its 2.2% projection made in April, hit by weakened external demand amid the coronavirus pandemic. The 2020 forecast would be the slowest growth for the region since 1961, while a 6.2% growth is still projected for 2021, the multilateral institution said in a statement.

Excluding the newly industrialised economies of Hong Kong, South Korea, Singapore and Taiwan, developing Asia is forecast to grow by 0.4% this year and 6.6% in 2021.

Asia’s PBR market expected to remain sluggish in H2 2020
By Helen Yan 18-Jun-20 15:08 SINGAPORE (ICIS)--Demand for polybutadiene rubber (PBR) is expected to remain sluggish in the second half of this year, due to the devastating impact of the coronavirus pandemic on the global economy.

Although major automotive makers have largely resumed production following the easing in lockdown restrictions, the automotive and tyre factories are mostly running at below 50% capacity due to manpower constraints and shrinking demand amid a contracting global economy.

Asia June oleochemical discussions affected by uncertain feedstock trend
By Jackie Wong 18-Jun-20 12:57 SINGAPORE (ICIS)--Trades and discussions involving oleochemicals in Asia are expected to remain relatively subdued in June as market participants look for a clearer trend in feedstock palm oil palm oil prices.

Trades in the fatty acids and fatty alcohols markets slowed down somewhat in the last couple of weeks as volatility in palm oil prices put both buyers and sellers on alert.

PODCAST: US PP faces varying demand, shifting trade flows on new capacity
By Zachary Moore 2020/06/17 HOUSTON (ICIS)— US polypropylene faces significant variations in demand between applications with fibre and packaging performing well while automotive and appliances are weak.

INSIGHT: Chemical industry faces up to cybercrime spike amid cost-cutting pressures
By: Tom Brown 2020/06/17 LONDON (ICIS)--Several chemical firms are contending with cyber attacks on networks or infrastructure amid a gold rush for hackers seeking to capitalise on the dramatic increase in home working and uncertainty brought on by the coronavirus pandemic.

There has been a substantial increase in attacks on chemical industry information technology and production assets amid a wider spike in malicious activity as hackers seek to exploit new vulnerabilities created by shifts in work habits since the onset of the coronavirus pandemic.

The move to more widespread home working in a compressed timeline as a result of lockdown and social distancing measures imposed during the coronavirus pandemic has spread company networks wider than they have ever been, which has created a host of vulnerabilities that hackers are looking to exploit.

Demand for OPEC crude set to fall in 2020 as Norway, Brazil supply rises
By: Tom Brown 2020/06/17 LONDON (ICIS)--OPEC has cut expected crude demand for its member states this year amid a modest uptick in non-OPEC supply growth forecasts.

The cartel expects demand for crude for its members to stand at 23.6m bbl/day this year, a reduction of 700,000 bbl/day from forecasts last month, despite leaving overall global demand projections unchanged at minus-9.1m bbl/day.

Non-OPEC liquids production is expected to increase by 300,000 bbl/day compared to cartel forecasts last month, driven by Norway, Brazil, Guyana, and Australia.

Spain automotive rescue package ‘very positive’ for chems, certain optimism returns
By: Jonathan Lopez 2020/06/17 LONDON (ICIS)--Spain’s rescue package for the automotive industry surpassing €1.0bn was higher than expected and has “created a lot of confidence” that the downturn this year, set to hit chemicals hard, may not be as severe as initially expected, the CEO of the country’s chemicals trade group FEIQUE told ICIS.

- Plan still includes grants for combustion engine models

- April chemicals output lower-than-expected fall fuels optimism

The Spanish cabinet unveiled this week a €1.05bn package in direct grants or loans for the purchase of vehicles.

As part of the package, €250m will be grants for consumers and businesses for the purchase of new vehicles, in amounts of €800-5,000 depending on the vehicle.

Click on the graph to make it bigger.

PODCAST: Pandemic to accelerate China chems self-sufficiency, global overcapacity
By: Will Beacham 2020/06/15 BARCELONA (ICIS)--The coronavirus pandemic impact may accelerate China’s self-sufficiency in chemicals, leaving the global industry struggling with overcapacity as that huge export market closes.

  • Industry pulling out of depths of downturn
  • But risk of second wave is high, infection rates rising globally
  • China paraxylene (PX) imports could fall from 16m tonnes to 9m tonnes in 2020
  • China refineries likely to run hard, flooding markets with gasoline and other products
  • Refinery/petrochemical interface under pressure
  • Global economy was in trouble before pandemic
  • Paradigm shifts accelerating – shift from fossil fuels, regional value chains, service-driven business models
  • Europe isocyanate markets gradually improving from very low levels
  • Demand from automotive still poor
  • Chemicals face changing auto market on switch to electric, autonomous

Click on the headline or scroll up to access the podcast.  

Margin squeeze hits some Asia petrochemical makers on naphtha, C2 spikes
By Pearl Bantillo 2020/06/17 SINGAPORE (ICIS)--Some petrochemical producers are hurting from a margin squeeze caused by crude-driven spikes in feedstock prices, and have resorted to cutting production as their ability to hike offers is constrained by poor demand.

India’s BPCL delays start-up of Kochi propylene derivatives complex
By Priya Jestin 2020/06/17 MUMBAI (ICIS)--India’s Bharat Petroleum Corp Ltd (BPCL) has delayed the start-up of its propylene derivative petrochemical products (PDPP) complex in Kochi due to the coronavirus pandemic, a company source said on Wednesday.

The Indian rupees (Rs) 52.5bn ($690m) project with a total capacity of 562,000 tonnes/year was supposed to start operations in June 2020.

Clariant announces breakthrough in PP catalyst technology that boosts output - execs
By Joseph Chang 2020/06/16 NEW YORK (ICIS)--Clariant said it has made a breakthrough in polypropylene (PP) catalyst technology with a phthalate-free catalyst that can also provide superior properties and improve plant output, executives said on Tuesday.

US chem shares rise amid market rally
By Al Greenwood 2020/06/16 HOUSTON (ICIS)--Most US-listed shares of chemical companies rose on Tuesday amid a general rally in the stock market.

Asia petrochemical shares jump on Wall Street rally
By Nurluqman Suratman 16-Jun-20 12:25 SINGAPORE (ICIS)--Asian petrochemical shares rose sharply on Tuesday, tracking the overnight rally on Wall Street after the US Federal Reserve announced that it will roll out a lending programme to support coronavirus-hit businesses.

China economic recovery faces another headwind amid virus resurgence
By Nurluqman Suratman 16-Jun-20 16:37 SINGAPORE (ICIS)--China's economic recovery will continue to face strong headwinds as it battles a fresh wave of coronavirus infections in Beijing, and amid continued weakness in external demand amid the pandemic.

US chem shares rise as stock market stages large swing
By Al Greenwood 2020/06/15 HOUSTON (ICIS)--US-listed shares of chemical companies rose on Monday after the stock markets swung from sharp losses earlier in the day. Stock markets opened lower amid fears of a resurgence of the coronavirus.

FOCUS: Wall Street turns more bullish on chemicals outlook, raises price targets
By Joseph Chang 2020/06/15 NEW YORK (ICIS)--Chemicals equity analysts are turning more bullish on the sector, citing a potential bottom in transportation and industrial end markets, an upturn in leading economic indications (LEIs) and price stabilisation.

Asia BD makers turn to ABS from synthetic rubbers amid margin erosion
By Helen Yan 2020/06/15 SINGAPORE (ICIS)--Asian butadiene (BD) producers are turning to the acrylonitrile butadiene styrene (ABS) market for demand amid eroded margins and weak buying interest from main downstream synthetic rubber sector.

Asia petrochemical shares, oil prices fall on fears of second virus wave
By Nurluqman Suratman 2020/06/15 SINGAPORE (ICIS)--Asian petrochemical shares were mostly lower while oil prices declined on Monday over renewed fears of a second coronavirus wave in view of recent spikes in new cases in the US and China.

VIDEO: Americas PET demand not as strong despite coronavirus-related bump in Q2
By Luly Stephens 2020/06/12 HOUSTON (ICIS)--Watch Markets Editor, Luly Stephens, provide a Spanish-language update on the PET markets in the Americas region.

Flint Hills to close US ethanol plant in Georgia - sources
By Alex Snodgrass 2020/06/12 HOUSTON (ICIS)--US ethanol producer Flint Hills Resources is permanently closing its 120m gal/year ethanol plant in Camilla, Georgia, according to sources.

US chem shares rebound after Thursday sell-off
By Al Greenwood 2020/06/12 HOUSTON (ICIS)--Most US-listed shares of chemical companies recovered a portion of their losses on Friday, following a large sell-off that saw many stock prices fall by more than 10%.

Europe PET boosted by appetite for local product, lockdowns easing but uncertainty remains
By: Caroline Murray 2020/06/12 LONDON (ICIS)--Millions of polyethylene terephthalate (PET) bottle sales are lost as mass gatherings across Europe are cancelled, flights are grounded, and tourism is displaced, but as society flickers back to life the industry holds onto a glimmer of hope.

“It is true that summer events are cancelled and international tourism is not expected to come back; Europeans will, however, stay home and after lockdown period want to ‘celebrate’ life,” a producer said.

Despite the recommendation from the European Commission - the EU's executive body - for member states within the visa-free Schengen area to lift border restrictions by 15 June, the Staycation may remain a priority over international holidays this summer.

INSIGHT: How recycling sector will overcome 'one of the most challenging times'
By: Morgan Condon 2020/06/12 LONDON (ICIS)--Consequences brought on by the pandemic have posed a severe threat to the global recycling industry and its future remains in jeopardy without support.

Speakers at a webinar hosted by the Bureau of International Recycling (BIR) this week discussed the immediate challenges facing the plastic recycling sector.

All speakers were in agreement that the current situation presented problems, with BIR chairman Henk Alssema dubbing it “one of the most challenging times ever seen” for the sector.

In 2019, the tide of public opinion was against single-use plastics and concerted efforts were channelled to environmental issues, but the coronavirus and ensuing economic decline has forced a shift in priority.

Looming Asia VAM plant turnarounds boost sellers’ sentiment amid feedstock cost pressure
By Helen Lee 2020/06/12 SINGAPORE (ICIS)--Asia’s vinyl acetate monomer (VAM) market remained stagnant on a lack of spot trading liquidity, but decreasing supply amid looming plant turnarounds, coupled with a recovery in the downstream ethylene vinyl acetate (EVA) sector, bolstered the sentiment of suppliers.

VAM producers have been unable to pass on feedstock cost gains due to bleak demand since April due to country lockdowns amid the coronavirus pandemic. Dairen Chemical implemented deeper output cuts at the Taiwan facilities in June.

Asia petrochemical shares, oil prices tumble as US virus cases surge
By Nurluqman Suratman 12-Jun-20 12:13 SINGAPORE (ICIS)--Asian petrochemical shares tumbled along with oil prices on Friday, following a plunge in US stocks overnight on concerns that a second wave of coronavirus infections is hitting the world’s biggest economy as it emerges from lockdown.

Sell-off hits US chem shares in worst day since March
By Al Greenwood 2020/06/11 HOUSTON (ICIS)--US-listed shares of chemical companies fell sharply on Thursday in their worst day since the sell-off in stock markets in March, amid worries that the nation faces a second wave of coronavirus infections.

PODCAST: June could prove turning point for US, European methanol
By Anna Matherne 2020/06/11 HOUSTON (ICIS)--June could be the turning point for both the US and European methanol markets because demand is expected to pick up - although much will depend on global outages and whether consumers return to their daily lives as quickly as expected.

INSIGHT: Technology helps chemical industry shift from product- to customer-focus
By Al Greenwood 2020/06/11 HOUSTON (ICIS)--New technology and tools to analyse data are helping chemical companies speed up the multi-decade evolution of the sector from one focused on products to one focused on customers

Europe PU feedstocks prices hit new lows as demand pickup lags
By: Fergus Jensen 2020/06/11 LONDON (ICIS)--Incremental improvements in demand for polyurethane (PU) products have slowed downward pressure on the Europe isocyanates and polyols markets where supply is abundant, and producers are now hoping for a reversal in the coming months.

- June isocyanates contracts at lowest levels on record

- June polyols contracts at lowest levels since 2009

- Summer holiday demand weakness anticipated

June contracts for polyols, toluene diisocyanate (TDI), and crude and pure methylene diphenyl diisocyanate (MDI) were all settled below May contract levels, and in some cases at hit new record lows.

The industry is largely focused on lockdowns being lifted and what impact economic difficulties resulting from the coronavirus will have on consumer spending.

VIDEO: June monthly R-PET flake, bottle prices drop in bearish market
By: ICIS Editorial 2020/06/11 LONDON (ICIS)--ICIS Senior Editor for Recycling, Matt Tudball, analyses the June price drops in the recycled polyethylene terephthalate (R-PET) flake and post-consumer bottle market.

- Lower flake demand puts pressure on post-consumer bottle prices

- Demand soft in well-supplied market

- Uncertain outlook for remainder of June

Click on the headline to see the video.

Asia petrochemical shares, oil slump on renewed global recession worries
By Nurluqman Suratman 11-Jun-20 12:38 SINGAPORE (ICIS)--Asian petrochemical shares fell along with oil prices on Thursday following warnings of an unprecedented global recession. Oil prices fell by more than $1/bbl, further weighed down by record-high crude inventory levels in the US.

Oil prices were under pressure on Thursday after weekly data from the US Energy Information Administration showed an unexpected rise in oil inventories, reviving worries of a persistent glut due to weak demand.

Postponed APIC event now to be held in May 2021 - CPMA
By Nurluqman Suratman 11-Jun-20 15:28 SINGAPORE (ICIS)--The Asia Petrochemical Industry Conference (APIC) will now be held in May 2021 after it was postponed because of the coronavirus pandemic, organizer Chemicals & Petrochemicals Manufacturers’ Association (CPMA) India said. The event was originally scheduled for 28-29 May this year in New Delhi, India, with CPMA as the host.

Asia PBT market steady amid thin trade; demand yet to pick up
By Clive Ong 11-Jun-20 14:56 SINGAPORE (ICIS)--Asia’s polybutylene terephthalate (PBT) resins market was stable while demand has not picked up in general. A revival in demand is possible in the third quarter, pending re-opening of economies within the region and in Europe. Buyers and sellers remained quite far apart in terms of price ideas.

“Unless major economies re-open and their automotive sectors revive, PBT demand would remain weak,” said a distributor in Singapore.

US chem shares fall again with general market
By Al Greenwood 2020/06/10 HOUSTON (ICIS)--Most US-listed shares of chemical companies followed by ICIS fell, as the general market declined and the Federal Reserve voted to keep interest rates near 0%.

INSIGHT: Avoiding a second wave critical to recovery, allaying longer term damage
By: Nigel Davis 2020/06/10 LONDON (ICIS)--The latest World Bank economic forecast suggests that the current recession will be almost three times as steep as that in 2009, and the deepest since the Second World War.

It assumes countries emerging from coronavirus-induced lockdowns by mid-year. The downgraded forecasts would not be expected to make easy reading.

“With advanced economies contracting, China experiencing record-low growth, and EMDE [emerging market and developing economies] growth savaged by external and domestic headwinds, the global economy is expected to shrink by 5.2% this year in a baseline forecast,” the World Bank said.

In such an environmentm the stimulus injected into sectors of the economy points to where the coronavirus impact may be alleviated the fastest.

Poor margins to persist in 2020 amid collapse in demand and rising capacities
By: Will Beacham 2020/06/10 LONDON (ICIS)--Analysis of the ethylene margin cycle suggests challenging conditions for producers in 2020, as new capacity and poor demand forces the cancellation of new projects and global rationalisation of assets.

Source: ICIS Analytics

It is easy to forget that in the pre-coronavirus world the chemical industry was already under a lot of pressure. New waves of capacity were coming on stream just as the US-China trade war was dampening growth around the world.

There were multiple profit warnings in 2019 as conditions worsened during the year.

Into 2020, profitability is likely to be even more challenged as a vast amount of new ethylene capacity is due on stream from now into 2021. As the current shale gas-related capacity boom peters out, attention shifts to China. Here around 10m tonnes of new projects are forecast to come on stream during 2019-2021, according to the ICIS Supply and Demand database.

UK breakaway from EU chems regulations could shut off market access for some firms - CBA
By: Tom Brown 2020/06/10 LONDON (ICIS)--The decision by the UK government to abandon hopes of remaining tied to the EU’s chemicals regulatory framework Reach effectively shuts off access to the market for some UK-based companies and makes access for others far more expensive, trade group CBA said on Wednesday.

Despite mentions of the European Chemicals Agency (ECHA) in numerous draft texts on the UK’s post-Brexit trade relationship with its former partners, the country is no longer seeking to negotiate membership of the regulator, according to a letter from a government minister.

The chemicals, aerospace and pharmaceuticals sectors were the industries the UK had expressed hopes of remaining aligned with the EU on post-Brexit through negotiating some form of continued associate membership.

PODCAST: PP demand to fall in 2020 as applications split
By: ICIS Editorial 2020/06/10 LONDON (ICIS)--European polypropylene (PP) editor Linda Naylor talks to ICIS senior consultant Fabrizio Galié about the outlook for PP supply and demand in Europe for 2020.

Polypropylene (PP) is used for packaging, ropes, carpets, plastic parts, loudspeakers and automotive parts.

Click on the headline or scroll down to hear the podcast.

Asia petrochemical shares mixed, oil prices lower on oversupply concerns
By Nurluqman Suratman 10-Jun-20 12:14 SINGAPORE (ICIS)--Asian petrochemical shares were mixed on Wednesday as investors await the outcome of a US Federal Reserve meeting while oil prices fell on oversupply concerns. “The global equity market rally appears to be taking a breather after a record-breaking rally saw $21tr being added to stock markets and investors decided to reassess if the recent rally has run too far for now,” Singapore's OCBC Bank said in a note.

Mideast POP demand stays weak; offers from Europe, Korea lower than China
By Prateek Pillai 10-Jun-20 16:32 SINGAPORE (ICIS)--Demand for 10.0-13.5% polyether polyols in the Middle East is expected to stay weak even with lower-priced cargoes available from Europe and South Korea.

Prices had been falling in the previous weeks mostly as a result of weak demand and given availability of attractive offers from Europe and South Korea since the second half of May.

ICIS WEBINAR: Players gear up for chemical M&A resurgence in H2 2020 bankers By Joseph Chang 2020/06/09 NEW YORK (ICIS)--Chemical mergers and acquisitions (M&A) activity is poised to pick up in the second half of 2020 as  lockdowns ease, and buyers and sellers prepare to get a start on making deals once again, investment bankers said on an ICIS Webinar on Tuesday.

US chem shares fall as general market takes break from rally
By Al Greenwood 2020/06/09 HOUSTON (ICIS)--Most US-listed shares of the chemical companies followed by ICIS fell on Tuesday along with the general market, after a string of rallies.

Limited new export-oriented global chems capacity growth expected to 2022 - Odfjell
By: Tom Brown 2020/06/09 LONDON (ICIS)--Limited new investment in export-oriented chemicals capacity is expected through to 2022 as a result of margin pressure from new supply coming onstream over the last few years add economic uncertainty after the pandemic, the Norwegian chemicals logistics and transport major Odfjell said on Tuesday.

Significant new capacity investments in the US and Middle East had contributed to strong shipping sector capacity demand, but depressed economic growth in 2019 has dampened investment appetite as players deal with margin pressure on the back of that supply growth.

Oversupply and uncertainty about the pace of recovery as a result of the pandemic is likely to limit new capacity investment over the next few years, according to Bjorn Kristian Roed, head of investor relations and research at Odfjell.

PODCAST:  Ethylene cycle points to project cancellations, overcapacity
By: Will Beacham 2020/06/08 BARCELONA (ICIS)--Analysis of the ethylene margin cycle suggests challenging conditions for producers in 2020, as new capacity and poor demand forces the cancellation of new projects and global rationalisation of assets.

- Profitability under pressure in 2020 compared with 2019
- Ethylene margins were dipping before coronavirus outbreak
- Expect project delays/cancellation where no final investment decision (FID) has been made
- Shift in new projects from US to China (more than 10m tonnes 2020/21)

Click on the headline or scroll up to hear the podcast.

VIDEO: Asia glycerine market slowly rebalancing amid improving demand
By Jackie Wong 2020/06/09 SINGAPORE (ICIS)--Watch ICIS editor Jackie discuss the Asian glycerine market, which has been rebalancing after a sharp surge in demand amid the ongoing coronavirus pandemic.

Asia growth outlook still weak despite massive support measures
By Nurluqman Suratman 2020/06/09 SINGAPORE (ICIS)--Asia's economic growth outlook remains clouded despite injection of massive fiscal stimulus packages to counter the crippling impact of the coronavirus pandemic.

The pandemic is choking the global economy: unemployment is spiking, manufacturing activity has ground to a halt, some businesses are facing closures while governments will be incurring huge budget deficits to fund the massive stimulus packages.

Asian petrochemical shares mixed; oil rises on demand recovery hopes
By Nurluqman Suratman 2020/06/09 SINGAPORE (ICIS)--Asian petrochemical shares were mixed while oil prices rose on Tuesday on hopes of a quick global economic recovery as investors await further clues on policy measures in the US.

Investors are now eyeing outcome of the US Federal Reserve's two-day policy meeting, which ends on Wednesday.

Shift to disposable utensils boosts US PS demand
By Zachary Moore 2020/06/08 HOUSTON (ICIS)--Demand for US polystyrene (PS) is receiving a boost from increased use of disposable utensils in the restaurant sector amid increasing concerns over public hygiene.

Most US chem shares rise with general market
By Juhi Varma 2020/06/08 HOUSTON (ICIS)--Most US-listed shares of chemical companies rose on Monday, still riding high on Friday's surprising jobs report and news of easing lockdowns.

Asia petrochemical shares up on Wall St rally; oil rises on output cuts
By Nurluqman Suratman 08-Jun-20 12:33 SINGAPORE (ICIS)--Asian petrochemical shares rose on Monday, tracking Wall Street’s rally on 5 June, while oil prices gained after OPEC and its allies, including Russia, agreed to extend their record output cuts.

Most US-listed shares of chemical companies rose last Friday, buoyed by release of a better-than-expected May jobs report.

Asia naphtha prices touch three-month high on crude oil rally
By Melanie Wee 08-Jun-20 14:55 SINGAPORE (ICIS)--Asia naphtha prices rose to a three-month high, bolstered by strong gains in crude oil futures, with healthy demand and curtailed excess flows from Europe poised to lend market support. In afternoon Asian trade, open-specification naphtha prices for second-half July delivery averaged at $380.00/tonne CFR (cost and freight) Japan, climbing by $18.50/tonne from the previous session on 5 June.

Asia IPA snaps downtrend on firm acetone; fresh discussions to begin
By Yuanlin Koh 08-Jun-20 14:36 SINGAPORE (ICIS)--Asia’s isopropanol (IPA) market snapped a four-week downtrend as upstream acetone spiked on tightened supply from turnarounds. Discussions are expected to start afresh this week as suppliers revised their strategies and buyers check their existing inventories.

Latin America PP faces high degree of demand risks amid rising feedstocks
By Renato Frimm 05-Jun-20 18:03 Latin America polypropylene (PP) continues to face a high degree of uncertainty stemming from pandemic-related impacts.

US chem shares rise amid upbeat jobs report
By Juhi Varma 2020/06/05 HOUSTON (ICIS)--Most US-listed shares of chemical companies rose on Friday, buoyed by release of a better-than-expected May jobs report.

US industrial ethanol demand remains strong, expected to be a long-term trend
By Alex Snodgrass 2020/06/05 HOUSTON (ICIS)-- Heightened demand for sanitizers, and consequently industrial ethanol, is expected to be a long-term trend even if a coronavirus vaccine is made.

VIDEO: US benzene rebounds as economy reopens and crude prices strengthen
By Adam Burkin 2020/06/05 HOUSTON (ICIS)--Watch Markets Reporter, Adam Burkin, discuss the dynamics facing US benzene markets during the coronavirus pandemic.

BASF top claimant of UK's coronavirus recovery package with £1.0bn funding
By: Morgan Condon 2020/06/05 LONDON (ICIS)--BASF received the biggest bailout from the Bank of England’s (BoE) €16.2bn recovery fund, the UK’s central bank announced on Friday.

The Covid Corporate Financing Facility (CCFF) total financing stands at €16.2bn; it was rolled out by the UK’s Chancellor of the Exchequer Rishi Sunak to support companies impacted by lockdown measures.

The German major topped the list of 53 recipients receiving the biggest portion of the fund at £1bn, and while it was the only chemicals producer listed, companies linked to the sector also gained from the scheme.

VIDEO: European PVC prices higher in 2020 as June discussions begin
By: ICIS Editorial 2020/06/05 LONDON (ICIS)--Senior editor Chris Barker discusses price increases for polyvinyl chloride (PVC) in the first half of 2020, contract discussions for June and the ongoing impact of the coronavirus pandemic on demand

  • Prices/tonne have risen against feedstocks from January-May
  • Construction activity rebounds in some countries in June
  • Producers independently attempt increases in line with feedstocks

Click on the headline to view the video.

PODCAST: Pandemic continues to pressure Europe demand for oxo-alcohols and derivatives
By: ICIS Editorial 2020/06/05 LONDON (ICIS)--Following the increase in upstream propylene costs for June, oxo-alcohols report editor Jane Massingham discusses the impact the pandemic continues to have on this market and its derivatives with glycol ethers editor Eashani Chavda, acrylate esters editor Katherine Sale and butyl acetate (butac) editor Nick Cleeve.

N-butanol (NBA) is a solvent with more than half if its production used as an intermediate chemical in the production of butyl acrylates for paints, coatings and adhesives, or acetates and glycol ethers. 2-ethylhexanol (2-EH) is used to make plasticizers, mainly dioctyl phthalate (DOP). Key end markets include the construction, appliance and automotive industries.

Divided in E-series and P-series, depending on whether they are made from ethylene oxide (EO) or propylene oxide (PO), glycol ethers are mainly used as a solvent for domestic and industrial applications such as paints and coatings.

Click on the headline or scroll down to hear the podcast. 

VIDEO: Upstream chemicals prices glimpse recovery but derivatives still falling
By: Barbara Ortner 2020/06/05 LONDON (ICIS)--ICIS Head of Market Reporting, Barbara Ortner, discusses the factors influencing chemical prices at the start of June.

- Crude, aromatics and olefins prices up
- Downstream chemical prices still falling
- Automotive outlook remains bleak
- Chemicals stocks rising on recovery hopes economic hopes
- Diversity and inclusion, centre stage

Click on the headline to view the video.

Asia petrochemical shares mostly higher; oil mixed on supply concerns
By Nurluqman Suratman 2020/06/05 SINGAPORE (ICIS)--Asian petrochemical shares were mostly higher on Friday after the European Central Bank (ECB) unexpectedly opted to increase its stimulus package, boosting hopes for a global economic recovery.

Influx of deep-sea cargoes to weigh on Asian BD market in the near term
By Helen Yan 2020/06/05 SINGAPORE (ICIS)--A supply glut caused by an influx of deep-sea butadiene (BD) supply from Europe and the US is expected to weigh on the Asian BD market in the near term.

US chem shares rise, breaking from oil, general market
By Al Greenwood 2020/06/04 HOUSTON (ICIS)--Many US-listed shares of chemical companies rose on Thursday, even as the general stock market was mixed and oil prices rose slightly.

ICIS WEBINAR: PE demand surprisingly strong
By Stefan Baumgarten 2020/06/04 HOUSTON (ICIS)--North American polyethylene (PE) producers saw stronger demand amid the coronavirus crisis than producers of many other chemicals and resins, Zachary Moore, ICIS deputy managing editor, said on Thursday.

ICIS Top 100 Chemical Distributors
By Joseph Chang 2020/06/04 NEW YORK (ICIS)--In the 22 May issue of ICIS Chemical Business which contained the ICIS Top 100 Chemical Distributors, we mistakenly omitted OQEMA, with $881.3m (€875m) in sales in 2019.

UK May car sales collapse by 89% to 1952 levels as lockdown devastates industry
By: Will Beacham 2020/06/04 BARCELONA (ICIS)--UK new car sales collapsed by 89% year on year in May to levels not seen since 1952 as the coronavirus shutdowns and closure of most automotive production devastated the country’s market.Figures published on Thursday by the Society of Motor Manufacturers show that just 20, 247 vehicles were sold in May 2020 compared with 183,724 a year earlier.

The fleet business fared worst, falling by 93% whilst private sales dropped by 84%. Sales of all types of cars fell except for battery electric vehicles which grew by 21.5% to 2,424.

The Tesla Model 3 electric vehicle was the top-selling car in the UK in May 2020, demonstrating how quickly consumers are shifting away from conventional vehicles.

Europe chemicals to gain from EU green deal spending plans - bank
By: Tom Brown 2020/06/04 LONDON (ICIS)--European chemicals players are expecting to see increased business momentum on the back of the EU’s green deal expected to unlock hundreds of billions of euros of investment in sustainability projects, according to Credit Suisse.

A virtual conference organised by the bank hosted management teams from 20 chemicals, agriculture, packaging and cement firms address investors, with all chemicals firms present noting expectations for an increase in sales on the back of the mooted EU green investment plan.

However, little visibility on uplift from the measures is expected over the next 12-18 months.

The European Commission - the EU's executive body - has proposed a raft of green investment measures at the heart of a €750bn coronavirus recovery stimulus package.

Asia petrochemical shares mixed; oil falls on output cut extension doubts
By Nurluqman Suratman 04-Jun-20 12:44 SINGAPORE (ICIS)--Asia’s petrochemical shares were mixed on Thursday on fresh tensions between the US and China, while oil prices fell on worries about growing global oil supply amid weak demand if major producers fail to extend production cuts.

At 03:10 GMT, Asahi Kasei was up by more than 2% in Tokyo, PetroChina was down by more than 1% in Hong Kong and LG Chem rose by close to 3% in Seoul.

Singapore manufacturing headwinds set to continue after May contraction
By Nurluqman Suratman 04-Jun-20 14:41 SINGAPORE (ICIS)--Singapore's manufacturing sector will likely remain in the doldrums for the rest of the year following another month of contraction in May as the coronavirus pandemic wears on the economy.

The city-state’s manufacturing purchasing manager' index (PMI) for May rose by 2.1 points from the previous month to 46.8, according to data from the Singapore Institute of Purchasing & Materials Management (SIPMM).

INSIGHT: Global methanol operating rate cuts expected in second half
By Rachel Qian 04-Jun-20 11:14 SINGAPORE (ICIS)--Although demand is slowly picking up, the global methanol market will remain soft in the second half of the year with operating rate cuts expected globally. This is predominantly driven by oversupply, a weakened futures market in China, and lack of storage which puts pressure on second half prices.


June 2020 Coronavirus presentation given by ICIS Analytics experts.


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