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EU Commission sets out chemical recyling mass-balance accounting approach
LONDON (ICIS)–The EU Commission has published proposals to allow mass balance for chemical recycling using a fuel-exempt accounting approach under the Single Use Plastics Directive (SUPD). It added that “the calculation methodology will serve as a model for future recycled content rules in other sectors, such as packaging, automotives and textiles. This approach is designed to give investors confidence in the long-term stability and potential of these technologies.” Mass-balance acceptance is seen as a key enabler for chemical recycling – in particular pyrolysis oil, given that pyrolysis oil is used as a naphtha substitute in crackers. A lack of regulatory clarity has seen buying interest in pyrolysis oil from the chemical sector fall in 2024 and 2025 (albeit from a high base) and made financing for new projects and infrastructure challenging. Differing accounting rules for mass balance can drastically alter potential profitability and a lack of clarity has made it challenging to predict returns on investment, as well as assessing Europe’s competitive position compared with other regions that may adopt differing mass-balance accounting rules. The EU Commission has launched a consultation on the proposals, which also covers the calculation, verification and reporting of recycled content under the SUPD. The consultation will run until 19 August. The Commission will then conduct a review before presenting a final draft to its technical committee to vote on. It aims to adopt the proposals under an implementing decision in Autumn 2025. Previously, the EU Commission had said that it was aiming to adopt the implementing decision in the fourth quarter of 2025. Under the proposal, the EU will adopt “fuel-use excluded” mass-balance accounting,  whereby material that is processed into fuel or process losses cannot contribute to recycled content targets. Free allocation (a method of mass balance that allows for the total allotment of recycled material to be attributed to any output) would be permissible for the remaining tonnage.  This is provided that: It is only attributed to outputs where it is possible to prove there is a feasible chemical process that could transform the input material into the chemical building blocks for each output The attributed amount of a specific output does not exceed the share of those parts of the output that can come from the used input eligible material The inputs, outputs, or both are chemical building blocks but not polymers. This would also apply to dual-use material – material that can be used in both fuel and non-fuel applications – in liquid or gas form. Solid material such as char would be excluded from the calculations. The Commission considers that “mechanical recycling technologies are in general preferable to chemical recycling technologies from an environmental point of view” and states that material that can be mechanically recyclable should not be used by chemical recyclers where it can produce recyclates with similar quality or performance characteristics. As a result, the proposals include allowances for the Commission to review the methodology and allocation rules under the decision. For liquid inputs fed into a steam cracker, the calculation steps to determine the allocation volume of recycled material would involve defining the maximum allowable boiling point at the steam cracker (or where the eligible material is processed by different steam crackers, the weighted average of the maximum acceptable boiling points of all the individual steam crackers), measuring the evaporation between eligible input material and total input material, calculating the ratio between the two and then applying that ratio to the total input weight at the cracker. This would involve using a standard test method for boiling range distribution of petroleum fractions by gas chromatography. For non-liquid material or processes not involving steam cracking, material would be distributed proportionally based on share of total input. For dual-use outputs, evidence would be required to prove that the material is being used in recycled plastics. The new implementing decision and annex does not appear to give any further clarity on the use of imported material counting towards the 25% recycled content required in polyethylene terephthalate (PET) beverage bottles from 1 January 2025. ICIS published an article in June following confirmation from the European Commission that only recycled polyethylene terephthalate (R-PET) produced using plastic waste in the EU can currently count towards the 25% recycled content target set out under the SUPD. However, following publication, market participants challenged this statement from the Commission’s Directorate-General for Environment highlighting the use of the word “imported” in formulas contained  in the Implementing Decision annexes, which those participants understood allowed the use of R-PET flake and food-grade pellet from third countries outside the EU to count towards the target. Imported material is still mentioned in the draft annex and ICIS is currently seeking further clarification from the Directorate-General for Environment over the status of imported material in counting towards the 25% target. Additional reporting by Matt Tudball ICIS is currently researching bio-naphtha pricing in Europe. If you’re interested in learning more and sharing your views on the market, please contact mark.victory@icis.com ICIS assesses more than 100 grades throughout the recycled plastic value chain globally – from waste bales to pellets. This includes recycled polyethylene (R-PE), R-PET, recycled polypropylene (R-PP), mixed plastic waste and pyrolysis oil 
PODCAST: Asia methanol supply normalizes, uncertainty over demand remains
SINGAPORE (ICIS)–Asian methanol prices have experienced significant volatility over recent weeks, on geopolitical concerns in the Middle East. While most production returned to normal in early July, some questions still remain around demand, both in India and the rest of Asia. Production in Iran, southeast Asia returns to normal US tariffs, seasonal factors to affect demand from downstream applications MTO run rates in China may be adjusted in July, margins may narrow In this chemical podcast, ICIS editors Doris He and Damini Dabholkar discuss recent market conditions and the outlook for Asia.
INSIGHT: End-of-life Vehicle Regulation – crucial differences in EU Council and Parliament approach
LONDON (ICIS)–The Environment and Internal Market Committees of the EU Parliament have adopted their proposals on the End of Life Vehicle Regulation (ELVR) which will now go to European Parliament plenary vote in September. The legislation has the potential for a similar impact on automotive and recycled plastic markets as that seen from the Single Use Plastics Directive (SUPD) and Packaging and Packaging Waste Regulation (PPWR). Nevertheless, the EU Council and the proposed position for the European Parliament are far apart from each other in crucial aspects of the legislation – most significantly points on mandatory recycled content targets, including:- What those overall targets should be The timeframe to meet those targets The type of plastic waste that can be used The role of chemical recycling and bio-based plastics The role of imports If the adopted proposals pass the European Parliament plenary vote. this will become the Parliament’s adopted position heading into trilogue negotiations with the EU Council. The EU Council adopted its position on 11 June. Both the EU Council adopted position and the European Parliament committees’ adopted proposals on minimum recycled plastic content in cars are more moderate than what was originally proposed in the European Commission’s draft. The Commission originally proposed that a mandatory 25% of plastic in new vehicles would need to be recycled plastic by six years after the regulation enters in to force, and with 25% of that target to have come from end-of-life vehicles. The EU Council’s position is for a graduated target with new vehicles needing to contain 15% recycled plastic six years after the regulation comes into force, 20% recycled plastic content after 8 years, and 25% after 10 years. For each target 25% of the recycled plastic would need to have originated from end-of-life vehicles. The European Parliament committees’ proposal is for a 20% recycled plastic target six years after the regulation comes into force, with 15% of that needing to come from end-of-life vehicles. The Parliament committees’ proposal would allow 50% of those targets to be met using pre-consumer material.  The proposal defines pre-consumer waste as “‘material diverted from the waste stream during a manufacturing process, excluding reutilisation of materials such as rework, regrind or scrap generated in a process and capable of being reclaimed within the same process that generated it.” The EU Council would only allow post-consumer material to count towards the targets. The Parliament committees propose that the target is increased to 25% for new vehicle type approved after 10 years “unless the lack of availability or excessive prices of specific recycled plastics makes compliance with that target excessively difficult.” Both the EU Council’s position and that proposed by the committees of the European Parliament would afford the European Commission wider powers for temporary derogations from all recycled plastic content targets due to “lack of availability or excessive prices of recycled plastics.” Neither gives guidance on what would constitute either situation. The version from the committees of the European Parliament goes further, however, requiring the EU Commission to evaluate whether manufacturers are on track to comply with recycled plastic targets by five years after the regulation enters into force. This would include evaluating: The availability of suitable plastic recycling technologies and the availability of recycled plastic The quality of that plastic compared with safety requirements Technical and economical difficulties to reach the target Based on the EU Commission’s evaluation it would be given the remit to amend the timing, scope and minimum percentages of the recycled plastic content targets. Both would confer powers on the Commission to establish the methodology to calculate and verify the share of recovered plastic in end-of-life vehicles. Nevertheless, the European Parliament Committees’ proposal specifically calls out chemical recycling, stating that the Commission should take into account “the best available recycling technology, including mechanical and chemical recycling.” The EU Council adopted position does not mention Chemical Recycling. In addition, the EU Council’s proposals would require separate treatment of post-consumer waste from end-of-life vehicles and no co-mingling with other materials throughout the recycling process. The proposals from the committees of the European Parliament would allow co-mingling as long as it met certain requirements – particularly that it did no harm to the overall recyclability of the material. The EU Council is proposing that by seven years and 11 months after the entry into force of the bill, the Commission should review the environmental performance and technological development of bio-based plastic in vehicles and propose legislation for bio-based plastic targets, sustainably requirements and whether bio-based plastic might count towards or be separate from recycled content targets. In February the European Parliament committee on the environment, climate and food safety and the committee on the Internal Market and consumer protection recommended allowing bio-based material to count towards recycled content targets from day one, but all mention of bio-based materials has been removed from the current proposals. While allowing for imports, the EU Council’s adopted position places a number of requirements on those imports including that any country plastic waste is sourced from has: equivalent environmental and worker safety standards as the EU A comprehensive waste management framework covering its entire territory which takes into account: operating on a ‘polluter pays’ principle (such as the establishment of an extended producer responsibility system or equivalent) It has measures implemented and planted to increase the proportion of post-consumer plastic recycled plastic from vehicles, and the proportion of post-consumer recycled plastic used in vehicles placed on the national market, and indicators for those measurements The proposals from the European Parliament committees would also allow imports, with the only restrictions relating to pre-consumer waste needing to meet “equivalent conditions with regard to emissions and separate collection and sustainability criteria for recycling technologies.” It does not detail what these equivalent conditions would be. Whichever approach wins out in the final version of the legislation will dramatically alter both its overall impact and which individual markets bear the weight of that impact. Taken together, the EU Council’s position appears considerably more stringent than the proposals from the committees of the European Parliament. The committees of the Parliament proposals’ allowance of pre-consumer waste, less stringent requirements for imports, and the specific mention of chemical recycling technologies would likely make these targets significantly easier to hit. Recycled plastic content targets would also stay limited to 20% for longer.  Coupled with this, the Parliament committees’ version seemingly includes greater scope for the European Commission to walk back on targets. Changes proposed by the parliamentary committees have been welcomed by the European Automobile Manufacturers’ Association. “ACEA particularly welcomes the inclusion of pre-consumer plastics in the calculation of recycled content targets, this ensures that targets remain achievable and aligned with manufacturing realities. Nevertheless, a phased-in approach is essential due to the current lack of high-quality, safe, and automotive-grade recycled plastics on the market,” the ACEA said in a press release on 7 July, although it remains concerned over what it considers a disproportionate impact on truck and bus manufacturers. 14.8m vehicles are manufactured in the EU per year, according to ACEA estimates from September 2024 Because of its separate collection and processing requirements, because it only allows post-consumer material, and because of its seeming lack of support for chemical recycling, the EU Council version of the bill would likely concentrate demand on the mechanically recycled polypropylene (R-PP) market. Polypropylene is widely used in vehicles, including in parts of the car such as cabin interiors where technical requirements such as heat resistance are lower compared with, for example, engine parts – making it potentially easier to incorporate recycled material. There is also already well established routes for recycling of end-of-life vehicle parts in the R-PP market. The European Parliament committees’ version could potentially result in higher demand for chemical recycled material depending on the European Commission’s calculation and verification requirements. The Parliament committees’ version specifically requires the Commission to take account of chemical recycling, and the Parliament would allow removed parts to count as waste from end-of-life vehicles under recycling targets – which could strengthen demand for tyre-derived chemical recycling in particular. “As the EU looks towards resource and material circularity as a tool for increased security and independence, ambitious goals for minimum recycled content in the mobility sector are a crucial piece of the puzzle. The automotive industry has a long-standing history of innovation, so despite the goals seeming ambitious to some, both manufacturers and the plastic recycling industry are ready to leverage the decades of technical knowledge to help car makers scale up the use of recyclate,”  Alexandra Tawton-Tomczyk, ICIS senior analyst, plastic sustainability and recycling EMEA said. Insight article by Mark Victory ICIS is currently researching bio-naphtha pricing in Europe. If you’re interested in learning more, and to share your views on the market, please contact mark.victory@icis.com ICIS assesses more than 100 grades throughout the recycled plastic value chain globally – from waste bales through to pellets. This includes recycled polyethylene (R-PE), recycled PET (R-PET), R-PP, mixed plastic waste and pyrolysis oil. 

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US chem stocks rally as EPA withdraws proposed Biden-era rules restricting chemical uses
HOUSTON (ICIS)–US-listed shares of chemical companies rose on Tuesday after the Environmental Protection Agency (EPA) withdrew proposed rules under the Toxic Substances Control Act (TSCA). Chemours shares were up by more than 10% mid-afternoon on Tuesday, while the S&P 500 hovered around unchanged. Almost all of the chemical companies followed by ICIS showed significant increases in share value, as shown in the following table. Symbol $ Current Price $ Change % Change AdvanSix 24.92 0.48 1.96% Avient 33.72 0.57 1.72% Axalta Coating Systems 30.62 0.42 1.39% Braskem 3.39 0.00 0.00% Chemours 13.61 1.19 9.58% Celanese 60.22 2.12 3.65% DuPont 74.46 1.48 2.03% Dow 29.04 1.56 5.68% Eastman 80.38 2.12 2.71% HB Fuller 62.84 2.08 3.42% Huntsman 11.245 0.595 5.59% Kronos Worldwide 6.505 0.175 2.76% LyondellBasell 63.75 3.02 4.97% Methanez 34.62 0.72 2.12% NewMarket 734.12 -3.31 -0.45% Olin 22.205 1.135 5.39% PPG 117.4 1.94 1.68% RPM International 112.51 1.48 1.33% Stepan 59.24 1.67 2.90% Sherwin-Williams 345.93 -0.36 -0.10% Tronox 5.655 0.425 8.13% Trinseo 2.96 0.06 2.07% Westlake 83.15 4.43 5.63% The withdrawn proposed rule, a significant new use rule (SNUR) under the TSCA, would have required businesses that intended to manufacture or import any of 18 specific chemical substances derived from plastic waste to notify the EPA at least 90 days prior to beginning any activity. New uses under the SNUR included manufacturing, processing, use, distribution in commerce, or disposal that do not conform to restrictions imposed from other TSCA requirements. Also, another proposed SNUR targeted manufacturing or processing of chemical substances using feedstocks containing any amount of heavy metals (chromium, cadmium, chromium VI, lead, or mercury), dioxins, phthalates, per- and polyfluoroalkyl substances (PFAS), polybrominated diphenyl ethers (PBDEs), and benzophenone, bisphenol A, ethyl glycol and methyl glycol. During its recent annual meeting in Colorado Springs, Colorado, the America Chemistry Council (ACC), a trade group that represents chemical companies, said it was optimistic that EPA regulatory shifts could emerge under the Trump Administration. The ACC also submitted to the EPA a list of more than 30 regulations it felt the agency could examine. TRUMP COULD ASSESS 50% COPPER TARIFFS Trump, speaking to assembled media at the White House during a cabinet meeting on Tuesday, said that he was planning on announcing a 50% tariff on copper imports later in the day. “Today we are doing copper,” Trump said. “I believe we are going to make it 50%.” The Wall Street Journal, citing Commerce Secretary Howard Lutnick, said the copper tariffs will take effect on 1 August. US copper futures prices for September delivery jumped by 12% after the announcement and were up about 10% when markets closed. Thumbnail photo by Shutterstock
EU Commission unveils Action Plan to save Europe’s ailing chems sector
LONDON (ICIS)–The European Commission has unveiled a plan to save the region’s ailing chemicals industry, while simplifying regulations to save €363 million a year, the institution announced on Tuesday. The Action Plan for the Chemicals Industry will tackle “high energy costs, unfair global competition and weak demand, while promoting investment in innovation and sustainability,” according to the statement. The Commission will form a Critical Chemical Alliance with member states and stakeholders “to address the risks of capacity closures in the sector.” Europe has already seen swathes of shutdowns this year against a backdrop of tough conditions. The Alliance will highlight critical production sites that need support, and will also address trade issues including supply-chain dependencies and distortions. In line with this, the Commission will apply defensive measures to ensure fair competition and expand chemical import monitoring through its existing Import Surveillance Task Force. The Alliance will align investment priorities, coordinate EU and national projects – including Important Projects of Common European Interest (IPCEIs) – and support innovation and growth at critical production sites. The Commission also said it will implement the Affordable Energy Action Plan “at full speed” to help reduce energy and feedstock costs for the chemicals industry. The plan introduces rules for low-carbon hydrogen and will update state aid to lower electricity costs for more chemical producers by the end of the year. The use of clean carbon sources – like carbon capture, biomass, and waste – are also encouraged in the plan, as well as support for renewables. There will be fiscal incentives and tax measures to help spur demand for clean chemicals, and the Industry Decarbonisation Accelerator Act will be introduced to support growth and investment in greener technologies. The upcoming Bioeconomy Strategy and Circular Economy Act will boost EU resource efficiency, chemicals recycling and “strengthen the market for bio-based and recycled alternatives to fossil-based inputs.” A public consultation has been launched on rules for calculating, verifying and reporting recycled content in single-use plastic (SUP) beverage bottles, which will be open until 19 August. Funding from Horizon Europe between 2025-2027 will be mobilized through the EU Innovation and Substitution Hubs to accelerate safer, more sustainable chemical substitutes. The Action Plan will reaffirm the Commission’s stance to minimize per- and polyfluoroalkyl substances (PFAS) emissions while be restricted. Continued use in critical applications where no alternatives are available “will be proposed swiftly after ECHA’s opinion,” the statement continued. “The Commission will also invest in innovation, promote remediation based on the polluter pays principle, and prioritise the development of safer alternatives.” The Commission is adopting its sixth simplification omnibus to reduce compliance and administrative costs for the chemicals industry, while still protecting human health and the environment. Annual savings of €363 million per year are expected through the ECHA Basic Regulation by simplifying hazardous chemical labelling, clarifying EU cosmetics regulations, and easing registration for EU fertilising products by aligning information with standard Reach requirements. The European Chemicals Agency (ECHA) is now responsible for classification and labelling, biocidal products, import and export of hazardous chemicals, waste management and water. European chemicals industry body Cefic welcomed the plan saying it “marks an important and timely first step towards boosting the competitiveness and resilience of the EU chemical industry. “This crucial signal to global investors and the announced measures go beyond signalling support…[The plan] is a much-needed signal of support, following Cefic’s calls for action to protect Europe’s most strategic industries,” the statement read. “Now, we must act collectively and quickly to restore competitiveness and resilience. There is no strategic independence, no climate neutrality, no energy transition, and no clean tech transformation without the European chemical industry.”
PODCAST: Romanian Black Sea gas will be a regional game-changer – OMV Petrom executive director
High capacity-booking interest for gas exports from Romania to Hungary for the next ten years indicate regional companies may be preparing for the start of Black Sea gas production from 2027. In 2024, Romania became the EU’s largest gas producer, a position that is likely to be further consolidated when the Neptun Deep block comes on stream. The project has faced political and regulatory headwinds over the years, and first volumes are set to reach markets at a time of numerous changes including surging global LNG production. In this podcast, Franck Neel, executive board member of project operator OMV Petrom, tells Aura Sabadus about latest developments at Neptun Deep, the company’s regional expansion plans and why Romanian Black Sea gas will have a competitive edge.
PODCAST: Dow closures show Europe faces choice to save chemical industry
LONDON (ICIS)–European politicians must decide if they want to save the region’s chemical industry as the wave of energy-intensive closures continues. Dow to close cracker at Bohlen, Germany, plus two other sites with loss of 800 jobs More than 5 million tonnes/year of ethylene capacity now under threat in Europe Industry still faces high energy costs, regulatory burdens, unfair competition China will continue to add capacity at least to 2030 China chemical plants running at higher-than-expected operating rates Importing ethylene and propylene can be expensive Political support will be vital to save Europe’s chemical industry New US tariffs may see two-tier chemical markets emerge in Asia Uncertainty and chaos likely to persist In this Think Tank podcast, Will Beacham interviews John Richardson from the ICIS market development team. Editor’s note: This podcast is an opinion piece. The views expressed are those of the presenter and interviewees, and do not necessarily represent those of ICIS. ICIS is organising regular updates to help the industry understand current market trends. Register here. Read the latest issue of ICIS Chemical Business. Read Paul Hodges and John Richardson’s ICIS blogs.
ChemOne secures $350mil Islamic insurance cover for upcoming $5.3bn PEC complex
SINGAPORE (ICIS)–ChemOne Group has secured $350 million in Islamic insurance cover, paving the way for Islamic banks to finance the $5.3 billion Pengerang Energy Complex (PEC) in Malaysia, the Singapore-based petrochemicals firm said on Tuesday. The Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC), a wholly owned subsidiary of the Islamic Development Bank (IsDB), has approved an insurance cover of $350 million for the PEC, ChemOne Group said. The ICIEC cover is structured under a Murabaha financing facility, providing 90% cover on both principle and profit and aligning with significantly de-risking the transaction for participating Islamic banks, the firm added. The Islamic banks include: National Bank of Kuwait (NBK) Qatar National Bank (QNB) Al Rajhi Bank Malaysia Al Rajhi Bank KSA Additionally, the IsDB Group has committed $150 million in direct investment via Istisna (manufacturing or construction contract) and Ijara (leasing contract) structures. Between direct investments and credit enhancement, the IsDB has supported the PEC with over $500 million, said ChemOne Group. The groundbreaking of the PEC project is expected to take place in Q4 2025 following financial close by the end of Q3 this year, a ChemOne spokesperson told ICIS on Tuesday. The Pengerang Energy Complex is slated to begin operations by the first quarter of 2029, the spokesperson said. The project has been beset by delays since 2020 due to “complex financing issues”, according to the project operator. Construction was previously set to begin in mid-2025 after $3.5 billion in funding was found in Dec 2024. Located within the Pengerang Integrated Petroleum Complex (PIPC) in Johor, the 6.5 million tonne/year PEC is capable of processing 150,000 barrels/day of condensate plus side feed of naphtha, that will in turn produce 2.6 million tonnes/year of aromatics, 3 million tonnes/year of energy products and hydrogen output of 50,000 tonnes/year. In May this year, ChemOne Group’s Vice President for Technology Mobin Rahman said the complex would utilize bionaphtha as a feedstock for the PEC, creating a circular and sustainable petrochemical chain. (Recasts paragraph 8 to an updated timeline for the start of commercial operations at the complex)
US crops steadily maturing as corn silking reaches 18%, soybean blooming at 32%
HOUSTON (ICIS)–US corn and soybean acreage is steadily maturing with 18% of the corn crop now silking and 32% of soybeans blooming, according to the latest crop progress report from the US Department of Agriculture (USDA). The amount of corn at the silking stage continues to rise but is behind the 22% achieved during the 2024 season, yet it is ahead of the five-year average of 15%. In the first update on corn reaching the dough stage, the USDA has 3% of the crop at this development point, which equals the 3% from 2024 and is slightly above the five-year average of 2%. For corn conditions, there remains 1% listed as very poor and 4% still poor, with the amount rated as fair down to 21%. The crop ranked as good has decreased to 57% with the level of excellent up to 17%. Soybean emergence has reached 96% and blooming is at 32%, which matches the 32% from 2024 and is above the five-year average of 31%. The crop that is setting pods is at 8%, at pace with the 8% rate from 2024 but a bit higher than the five-year average of 6%. For soybean conditions, there is still listed 2% very poor, 5% poor and 27% rated as fair. The amount that is ranked as good has decreased to 54% with excellent lifted to 12%. Cotton plantings are concluded with sorghum sowings at 96%. Winter wheat harvest has reached a 53% completion rate.
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