Germany’s business confidence index, compiled by the ifo Institute, declined in January as the country’s lockdown is “unlikely to end” on 14 February as planned, financial analysts said on Monday.
Europe’s chemical sector faces a carbon bill of around €1bn in 2021 amid a ramp up in regulatory measures around the world.
The shipping woes that have dogged the chemicals sector for months show no sign of abating, with disrupted international trade flows driving up prices and limiting availability, with European issues exacerbated by confusion and gridlock following the UK’s departure from the EU.
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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LATEST HEADLINES
PODCAST: Europe
chemicals face €1bn 2021 carbon bill as global
action intensifies
By: Will Beacham 2021/01/25 BARCELONA
(ICIS)--Europe’s chemical sector faces a carbon
bill of around €1bn in 2021 amid a ramp up in
regulatory measures around the world.
- Europe carbon prices rose from €25/tonne in October 2020 to €35/tonne today
- Expect a big shift from global to local supply chains as pandemic exposed weaknesses, carbon taxes to enable change
- Beyond 2030 there may be no more worldscale chemical projects built
- Automotive semiconductor shortage highlights vulnerabilities of global supply chains
Click on the headline to hear the podcast
Shortages,
skyrocketing prices continue for chems
shipping
By: Tom Brown 2021/01/25 LONDON
(ICIS)--The shipping woes that have dogged the
chemicals sector for months show no sign of
abating, with disrupted international trade
flows driving up prices and limiting
availability, with European issues exacerbated
by confusion and gridlock following the UK’s
departure from the EU.
Shipping costs have skyrocketed over the last few months, with market sources reporting that they have been quoted six times or more the level seen in mid-2020, when prices first started to climb.
““Every day and week the sea freight costs are going up,” said a European trader.
Germany’s
business climate worsens as lockdown could go
beyond mid-February
By: Jonathan Lopez 2021/01/25 LONDON
(ICIS)--Germany’s business confidence index,
compiled by the ifo Institute, declined in
January as the country’s lockdown is “unlikely
to end” on 14 February as planned, financial
analysts said on Monday.
The pandemic’s second wave has hit Germany hard, and the country’s health services have been under pressure since December; unlike in the spring of 2020, Germany’s death toll has surpassed 1,000 on several days in January this year.
January’s economic performance was hit by the lockdown, with falls in practically all economic sectors – including manufacturing, construction, trade, and services – although the fall in confidence during the month is far from the lows posted in the second quarter of 2020.
China holiday-travel curbs dampen petrochemical
restocking
Petrochemical restocking in China this year
will not be strong as in the past as the usual
heavy manufacturing disruption that accompanies
the Lunar New Year holidays may not happen,
with travel curbs in place to ward off another
wave of coronavirus infection in the country.
India's Reliance net profit rises in Sept-Dec
despite drop in revenue
Reliance Industries Limited's (RIL) net profit
rose by 13% year on year in the three months to
31 December 2020 despite a drop in revenue, the
Indian chemicals major said late on Friday.
US
adds oil, gas drilling rigs as count rises for
ninth week
By Adam Yanelli 2021/01/22 HOUSTON (ICIS)--The
US saw an increase in the number of oil and gas
drilling rigs in operation this week, rising
for the ninth week in a row, despite rising
concerns about how an outbreak of
the coronavirus in China will impact crude oil
demand
Japan’s au Jibun Bank flash
manufacturing PMI slips to 49.7 in
Jan
By Nurluqman Suratman 2021/01/22 SINGAPORE
(ICIS)--au Jibun Bank’s flash manufacturing
purchasing managers’ index (PMI) for Japan
slipped to 49.7 in January from the final
reading of 50.0 in December 2020 as output fell
amid rising costs, the Japanese bank said on
Friday.
A PMI reading below 50 indicates a contraction in the manufacturing economy.
"Despite a return to growth in new orders for the first time since December 2018, falling output and employment levels and rising cost pressures dampened operating conditions," au Jibun Bank said.
Washington state in US denies permit
for methanol plant
By Al Greenwood 2021/01/21 HOUSTON (ICIS)--The
Washington Department of Ecology denied a
permit for a proposed methanol plant in that
state's town of Kalama.
The department denied issuing the shoreline-conditional-use permit because of concerns about greenhouse-gas emissions, it said. As a result, Washington state could fail to meet its greenhouse-gas targets that were set by its legislature.
The plant is being developed by Northwest Innovation Works (NWIW). The methanol would be used in China’s methanol-to-olefins (MTO) plants.
Mideast chemical supply tight on
container shortages, Asian plant
shutdowns
By Felicia Loo 2021/01/21 SINGAPORE
(ICIS)--Middle East's petrochemical markets are
facing tight supply, mainly due to shortage of
containers, with shipment difficulties to last
until March. Plant shutdowns in Asia
exacerbated the tight supply conditions,
overshadowing demand from strong to stable in
certain sectors in the Middle East.
Japan's chemical exports rise by 10% in
Dec, overall shipments up 2%
By Nurluqman Suratman 2021/01/21 SINGAPORE
(ICIS)--Japan's chemical exports rose by 10.0%
year on year in December 2020 to yen (Y)
833.9bn as overall shipments abroad rose for
the first time in two years, official data
showed on Thursday.
USA’s INVISTA licenses technology to
Sinopec Yizheng for new PTA
line
By Nurluqman Suratman 2021/01/21 SINGAPORE
(ICIS)--INVISTA and China’s Sinopec Yizheng
have reached a technology licensing agreement
for a new purified terephthalic acid (PTA) line
in Jiangsu province, the US producer said on
Thursday.
Indian chemicals industry bats for
increasing duties on imports
By Priya Jestin 2021/01/21 MUMBAI (ICIS)--The
Indian chemicals and petrochemicals industry,
which is now seeing a slow recovery in demand,
expects the government to support its growth
trend by introducing measures to reduce
unnecessary imports.
PODCAST: Global ACN supply restrictions
continue to dominate talk in
Q1
By Jane Massingham 2021/01/20 LONDON
(ICIS)--The global acrylonitrile (ACN) market
is expected to remain tight through Q1,
although uncertainty looms in the shape of
Chinese New Year and how it may impact on
regional demand. ICIS pricing editors Jane
Massingham (Europe), Li Li Chng (Asia) and
Lucas Hall (US) discuss the latest developments
in the ACN market and what lies in store.
PODCAST: Jet and bio fuels in 2021 –
what are the trends?
By Andrew Putwain 2021/01/20 LONDON (ICIS)--
Jet fuel has been one of the oil products hit
hardest by the pandemic. With vaccines now
being rolled out will there be more support in
2021 - even as the market faces pressures to
turn to more sustainable biofuels? Market
analyst Man Yiu Tse and crude oil reporter
Andrew Putwain look at the big trends for 2021
in jet fuel and biojet alternatives.
Malaysia central bank keeps accommodative
monetary stance amid new
lockdown
By Pearl Bantillo 2021/01/20 SINGAPORE
(ICIS)--Malaysia’s central bank decided on
Wednesday to maintain an accommodative monetary
policy as it acknowledges that new
coronavirus-related restrictions will hit
near-term economic performance. Its overnight
policy interest rate was kept at 1.75%.
Singapore’s 2020 chemical fixed asset
investments fall; overall FAI
grows
By Nurluqman Suratman 2021/01/20 SINGAPORE
(ICIS)--Singapore’s chemical fixed asset
investments (FAI) fell by 18.9% year on year to
Singapore dollar (S$) 4.11bn in 2020, but
overall FAI rose despite the challenges arising
from the coronavirus pandemic, official data
showed on Wednesday.
India’s GNAL delays commissioning of new
caustic soda line to August
By Priya Jestin 2021/01/20 MUMBAI
(ICIS)--India’s GACL-NALCO Alkalies &
Chemicals Ltd (GNAL) has pushed back the
scheduled commissioning of its greenfield
266,667 tonne/year caustic soda plant in Dahej
to August 2021, a company source said on
Wednesday.
VIDEO: China non-carbide VAM supply to tighten
further on EVA start-ups
By Anna Xiang 2021/01/19 SINGAPORE
(ICIS)--Watch industry analyst Anna share her
views on China's domestic vinyl acetate monomer
(VAM) market for 2021.
Chip shortage threatens global auto
sector, demand for chemicals and
polymers
By: Will Beacham 2021/01/18 BARCELONA
(ICIS)--A global shortage of computer chips is
threatening the nascent recovery of automotive
production, as well as demand for automotive
chemicals around the world.
Semiconductor chip manufacturers have struggled to meet demand growth in the fourth quarter of 2020 and into 2021 as the automotive sector rebounded from Coronavirus lockdowns, especially in China. Increased sales of computers and electronic devices through the pandemic have also boosted demand.
Auto production is already disrupted by the shortage of chips. Germany’s Audi has slowed production and has furloughed 10,000 employees, according to an interview quoting company CEO Markus Duesmann in the UK Financial Times on 17 January.
INSIGHT: UK chemicals face continued
disruption from post-Brexit paperwork,
container shortages
By: Will Beacham 2021/01/18 BARCELONA
(ICIS)--UK chemical companies and their 27 EU
trading partners are still struggling with new
paperwork requirements and disrupted logistics,
two weeks after the country left the Single
Market and Customs Union.
- Tariffs are 0% from the UK-EU
- Tariffs average 4.5%, maximum 6.5% for other
countries not covered by free trade
agreements
- Rules of origin and customs declarations
required from exporters and customers before
products can cross borders
- Incomplete paperwork holding up trade at
border
- DB Schenker pauses UK-EU operations
- Asia-Europe container rates at $4,000-6,000
as global pandemic-related shortage persists
Despite the post-Brexit free trade deal struck by UK Prime Minister, Boris Johnson, cross-border trade is still subject to a raft of new customs checks and procedures plus a global shortage of containers which continues to delay shipments and inflate costs.
Although tariffs have been maintained at 0%, all goods are now subject to rules of origin and other customs declarations.
Singapore petrochemical
exports snap 27-month decline; up 11.5% in
Dec
By Nurluqman Suratman
2021/01/18 SINGAPORE (ICIS)--Singapore's
petrochemical exports in December 2020
increased by 11.5% year on year to Singapore
dollar (S$) 1.25bn, ending more than two years
of decline, official data showed on Monday.
The year-on-year expansion was the first recorded since August 2018, according to Enterprise Singapore.
China's 2020 GDP rises by
2.3% after 6.5% expansion in
Q4
By Nurluqman Suratman
2021/01/18 SINGAPORE (ICIS)--China's GDP grew
by 2.3% year on year in 2020, its slowest pace
in more than four decades, after it reported a
6.5% expansion in its economy in the fourth
quarter, official data showed on Monday.
France’s Total to invest
$2.5bn in India’s Adani Green
Energy
By Pearl Bantillo
2021/01/18 SINGAPORE (ICIS)--France’s Total
will acquire a 20% interest in Adani
Green Energy Ltd (AGEL), along with a 50% stake
in a 2.35 GWac (gigawatt alternating current)
portfolio of the Indian solar developer’s
operating solar assets, for a total of $2.5bn.
US WR
Grace is willing to discuss sale to 40
North
By: Jane Miranda 2021/01/15 HOUSTON (ICIS)--WR
Grace is willing to discuss a sale to 40 North,
after the private investment firm raised its
bid to $65 per share earlier this week, the
US-based catalyst producer.
German chemicals reject calls to shut
plants as pandemic hits hard
By: Stefan
Baumgarten 2021/01/15 LONDON
(ICIS)--Germany’s top chemical industry trade
groups are rejecting calls to shut down plants
as part of the country’s “hard lockdown” to
contain the second wave of the coronavirus
pandemic.
“A shutdown would
be counter-productive, in all respects”,
chemical producers group VCI and employers
group BAVC said in a joint statement on Friday.
The chemical-pharmaceutical industry makes “key contributions” to containing the pandemic, the trade groups said, in vaccine production, the manufacture of essential medicines or as the most important upstream supplier for diagnostics, medical, and laboratory equipment manufacturers.
US to
face heavy economic losses if trade war with
China continues
By Pearl
Bantillo 2021/01/15 SINGAPORE (ICIS)--The US
economy is hurting itself if its trade war with
China continues in the medium term, possibly
shaving a large chunk of its GDP output with
attendant massive job losses.
US'
CME to launch ICIS-linked China specific
origins methanol futures contract in
Feb
By Nurluqman Suratman
2021/01/15 SINGAPORE (ICIS)--The CME Group aims
to launch an ICIS-linked China methanol futures
contract on the New York Mercantile Exchange on
22 February.
US
infrastructure plan to be unveiled in February
in 2nd step of massive
stimulus
By Joseph Chang
2021/01/15 NEW YORK (ICIS)--US President-elect
Joe Biden plans to unveil details of a major US
infrastructure stimulus plan in February in his
first appearance before a joint session of
Congress after announcing his first step of
massive fiscal stimulus.
China
December exports grow 18.1% year on year;
imports up 6.5%
By Yvonne Shi 2021/01/14 SINGAPORE
(ICIS)--China’s total exports in December rose
by 18.1% year on year to $281.9bn, according to
preliminary data from the government.
Northern China LPG
logistics hit by lockdowns, travel
restrictions
By Lillian Ren
2021/01/14 SINGAPORE (ICIS)--LPG logistics have
become challenging in northern China after a
rising number of corona virus cases in Hebei,
Liaoning and Heilongjiang forced a few cities
into lockdowns, and led several cities to
impose travel restrictions.
Fed notes healthy US demand for
PVC
By Al Greenwood 13-Jan-21 15:05 HOUSTON
(ICIS)--US demand for polyvinyl chloride (PVC)
was healthy during the past several weeks, the
Federal Reserve said on Wednesday in its
periodic survey of business conditions.
Virus-related restrictions in north
China hit petrochemical
transport
By Yvonne Shi 2021/01/13 SINGAPORE
(ICIS)--Coronavirus-related restrictions in
parts of northern China - including Hebei
province, where cases of infections recently
spiked - are hitting transport of
petrochemicals in the region.
PODCAST: China lockdowns could hurt
chemical imports, industrial
production
By Will Beacham 2021/01/12 BARCELONA
(ICIS)--Major new coronavirus lockdowns in
China could threaten demand for chemical
imports, and hurt industrial production of
products for local consumption and export.
PODCAST: Asia PE sets to see support
from strong feedstock, high shipping
costs
By Jasmine Khoo 2021/01/13 SINGAPORE
(ICIS)--Southeast Asia’s polyethylene (PE)
market ended a turbulent year in 2020 with
major price increases but early 2021
fundamentals suggest shipping costs and
feedstock prices are still likely to drive
prices in the first quarter.
Asia petrochemical shares mostly lower
amid new virus-linked
lockdowns
By Nurluqman Suratman 2021/01/12 SINGAPORE
(ICIS)--Asia’s petrochemical shares were mostly
lower on Tuesday on new lockdowns in parts of
the region amid the unabated surge in
coronavirus cases, which topped 90m globally.
Malaysia to impose two-week limited
lockdown from 13 January
By Pearl Bantillo 2021/01/11 SINGAPORE
(ICIS)--Malaysia's Prime Minister Muhyiddin
Yassin said on Monday that a limited lockdown
will be in place for two weeks from 13 January
to contain the spread of coronavirus infections
in the country.
Taiwan's FPCC 2020 net income slumps
80% on lower margins
By Nurluqman Suratman 2021/01/11 SINGAPORE
(ICIS)--Formosa Petrochemical Corp (FPCC) has
reported an 80% decline in its 2020 net profit
as margins weakened amid the coronavirus
pandemic.
GPCA cancels Dubai meeting in February
on worsening health
situation
By: Jonathan Lopez 2021/01/11 LONDON
(ICIS)--The Gulf Petrochemical Association
(GPCA) annual meeting planned for February has
been cancelled as the coronavirus pandemic
worsens globally, the industry group said on
Monday.
In the past week, coronavirus cases in the UAE have risen sharply, although the country has for the most part kept the pandemic at bay.
The GPCA meeting was due to be held in Dubai, one of the UAE’s seven emirates.
Europe butac prices surge on very tight supply,
BASF force majeures continue
By Nick Cleeve 11-Jan-21 14:43 LONDON
(ICIS)--European butyl acetate (butac) spot
prices have risen sharply, with the ICIS
midpoint reaching its highest level since March
2017.
Butac prices were assessed at €1,400-1,500/tonne FD (free delivered) NWE (northwest Europe) - an increase of €150-200/tonne.
Sources referred to prices far above the assessed range, but significant business at these levels could not be confirmed.
Supply is very tight due to major producer BASF’s active force majeures and limited availability of feedstock n-butanol (NBA).
PODCAST: Europe chemicals’ challenges
for the 2020s
By: Jonathan Lopez 2021/01/11 LONDON
(ICIS)--After the health crisis recedes, the
European chemicals industry’s challenges will
remain unchanged - sustainability, recycling
and how it can achieve carbon neutrality by
2050.
The ICIS European news desk analyses what is in store in this podcast with News Editor Jonathan Lopez, Deputy News Editor Tom Brown, News Reporter Morgan Condon, and Insight editor Nigel Davis.
Click on the headline to hear the podcast.
Taiwan's FPCC 2020 net
income slumps 80% on lower
margins
By Nurluqman Suratman
2021/01/11 SINGAPORE (ICIS)--Formosa
Petrochemical Corp (FPCC) has reported an 80%
decline in its 2020 net profit as margins
weakened amid the coronavirus pandemic.
India
to impose antidumping duty on PA imports from
Russia
By Priya Jestin
2021/01/11 MUMBAI (ICIS)--India will impose a
five-year antidumping duty (ADD) of
$159.43/tonne on phthalic anhydride (PA)
imports from Russia.
India
defers import certification requirements for
some chemicals
By Priya
Jestin 2021/01/11 MUMBAI (ICIS)--India has
deferred the implementation of mandatory Bureau
of Indian Standards (BIS)
certification requirement on imports
of ethylene glycol, toluene, butyl acrylate,
terepthalic acid and phthalic anhydride to
mid-2021.
PODCAST: Europe MTBE demand to recover
in Q2, methanol price pressure
continues
By: Eashani Chavda 2021/01/07 LONDON
(ICIS)--ICIS editors Eashani Chavda and Nazif
Nazmul discuss market fundamentals and
expectations for European methyl tertiary butyl
ether (MTBE) and methanol.
- Winter driving season drives demand for MTBE lower in January
- Demand expected to improve by Q2 at the earliest
- Methanol market bullish on supply shortages, healthy demand
Click on the headline to hear the podcast
Qatar re-opens
chemical trades within GCC after diplomatic
breakthrough
By Felicia Loo 2021/01/08 SINGAPORE
(ICIS)--With Saudi-led Gulf Cooperation Council
(GCC) members restoring relations with Qatar,
polyethylene (PE) and polypropylene (PP)
processors in Saudi Arabia can now supply
products to the Qatari market.
PODCAST: Faltering China chemicals
signal caution for 2021
By: Will Beacham 2021/01/05 BARCELONA
(ICIS)--Softening chemicals demand and prices
in China may be an early sign of trouble ahead
for the global industry in 2021.
- High inventories, weaker demand for China chemicals
- Falling China prices may signal trouble ahead for recovery
- Strong economic, chemicals recovery in H2 2020
- Paradigm shifts apparent in 2020 will accelerate through 2021
- Includes new demand patterns, supply chains, energy balances, circular economy, advanced manufacturing
Click on the headline to hear the podcast.
Asia manufacturing continues recovery
in December
By Nurluqman Suratman 2021/01/07 SINGAPORE
(ICIS)--Asia's manufacturing activities mostly
improved in December, affirming the region's
economic recovery despite a recent pick-up in
coronavirus infection rates.
INSIGHT: Outlook dimming on downside
risks, possible China price
inflection
By Nigel Davis 2021/01/06 LONDON
(ICIS)--Petrochemicals companies' fortunes have
improved over the past three months as demand
has strengthened and prices increased.
December IPEX up 6.5% on rising prices
in Europe and the US
By Miguel Rodriguez Fernandez 2021/01/06 LONDON
(ICIS)--The ICIS Petrochemical Index (IPEX)
continued to climb in December, increasing by
6.54% for the month, tracking price increases
for most of the major petrochemical and
plastics commodities.
VIDEO: Key drivers for Asia
petrochemical markets in
2021
By Soo Hwee Peh 2021/01/06 SINGAPORE
(ICIS)--Watch Asia managing editor Soo Hwee Peh
as she shares some of the key drivers that will
shape Asia's petrochemical markets this year.
East Asia and Pacific economy to expand
7.4% in 2021 - World Bank
By Nurluqman Suratman 06-Jan-21 11:55 SINGAPORE
(ICIS)--Economic growth in east Asia and the
Pacific is projected at 7.4% in 2021, reversing
an estimated contraction of 0.9% in 2020, led
by a strong rebound in China, the World Bank
said late on Tuesday.
INSIGHT: ESG to drive
chemicals growth and investment in 2021 and
beyond
By Joseph Chang 2020/12/18 NEW YORK (ICIS)--As
we say goodbye, or good riddance to 2020, one
key positive development for the chemicals
industry is the sharpening focus on ESG
(Environmental, Social, Governance) - a trend
that will only accelerate in the years to come
and offer great opportunity to develop new
business models.
INSIGHT: Sustainability and recycling
set to dominate 2021 agenda
By: Helen McGeough 2020/12/18 LONDON
(ICIS)--The events of this year may have been
unpredictable but 2021 offers no improved
certainty given the continuing effects of the
coronavirus pandemic and onset of a global
economic downturn.
Sustainability may have slipped in the focus, if not agenda, of consumers to corporates alike due to other priorities, but it is set to return with fervour next year.
There had been an expectation that demand from the packaging sector would grow sharply in 2020 from recycled high density polyethylene (R-HDPE) and recycled polypropylene (R-PP) amid the growing focus on sustainability, but much of this growth was curtailed by the impact of coronavirus.
Backlogs at testing facilities, concerns about entering new supply chains amid the pandemic, and workforce and financial pressures led firms to concentrate on core products.
Japan
raises fiscal year ‘21 GDP growth forecast to
4% on stimulus
By Nurluqman
Suratman 2020/12/18 SINGAPORE (ICIS)--Japan's
government on Friday raised its economic growth
forecast for the next fiscal year - starting
April 2021 - on a price-adjusted real terms to
4.0% from 3.4% previously, supported by its
latest coronavirus stimulus package.
Singapore Nov petchem
exports down 18.5%, NODX slips
4.9%
By Nurluqman Suratman 2020/12/17 SINGAPORE
(ICIS)--Singapore's petrochemical exports fell
by 18.5% year on year to Singapore dollar (S$)
955.8m in November, weighing on overall non-oil
domestic exports (NODX), official data showed
on Thursday.
ANALYSIS AND RESOURCES
ICIS chemicals coronavirus Impact Demand Model November 2020 by willbeacham on Scribd