HOUSTON (ICIS)–US President Donald Trump on Thursday extended the deadline for a trade deal with Mexico by 90 days, leaving in place the current agreement, according to a post on social media. Trump said Mexico will continue to pay a 25% fentanyl tariff, a 25% tariff on cars, and a 50% tariff on steel, aluminium and copper. “Additionally, Mexico has agreed to immediately terminate its Non Tariff Trade Barriers, of which there were many,” Trump wrote in the post. Trump said the US will continue negotiating with Mexico over the next 90 days, “with the goal of signing a Trade Deal somewhere within the 90 Day period of time, or longer”. Mexico President Claudia Sheinbaum said in a social media post that the call with Trump was, “very good”. “We avoided the tariff increase announced for tomorrow and gained 90 days to build a long-term agreement through dialog,” Sheinbaum wrote. The US has proposed a 30% tariff on Mexican imports, applicable to imports that do not comply with the USMCA, a regional trade agreement. Visit the ICIS Topic Page: US tariffs, policy – impact on chemicals and energy.

MADRID (ICIS)–Brazil’s central bank has maintained the benchmark Selic rate at 15.00% but the decision was “overshadowed” by US President Donald Trump’s executive order to implement 50% tariffs on Brazilian imports from 6 August. Although the decision includes significant exemptions which will limit the potential economic damage, the tariffs are expected to slow the Brazilian economy further. The Banco Central do Brasil (BCB)’s monetary policy committee (Copom) said it left the Selic unchanged following a more adverse and uncertain global environment in the wake of tariff announcements which affected financial conditions worldwide. “The global environment is more adverse and uncertain due to the economic policy and economic outlook in the US, mainly regarding its trade and fiscal policies and their effects,” said Copom. “[This scenario] requires particular caution from emerging market economies amid heightened geopolitical tensions.” Trump’s executive order earlier this week confirmed that 50% tariffs will take effect on 1 August 1 although, contrary to expectations, significant exemptions were added to cover some key exports from Brazil including civilian aircraft, orange juice, and most mining products. “By our estimates, the exemptions cover almost half of Brazil’s exports to the US (as most agriculturals are not exempt). This suggests that the actual hit to GDP will be smaller [than initially expected],” Capital Economics stated. Earlier this week, US chemicals trade group, the American Chemistry Council (ACC), said in an interview with ICIS that tariffs on Brazilian goods, and the potential for retaliation from Brazil, was a major concern for the sector. For its part, Brazil’s chemicals trade group Abiquim confirmed to ICIS that after Trump’s tariffs announcement, Brazilian chemicals producers had seen export orders cancelations for specific resins and compounds used in fertilizer production. SLOWDOWNCopom said late on Wednesday that Brazil’s domestic economic indicators are showing economic activity moderation, as expected, although the labor market remains strong. However, US tariffs are still a concern. “The committee has been closely monitoring the announcements on tariffs by the US to Brazil, which reinforces its cautious stance in a scenario of heightened uncertainty. Moreover, it continues to monitor how the developments on the fiscal side impact monetary policy and financial assets,” it said. “The current scenario continues to be marked by deanchored inflation expectations, high inflation projections, resilience on economic activity and labor market pressures.” Headline inflation and underlying measures remain above the inflation target. Inflation expectations for 2025 and 2026 from a focus survey remain above target at 5.1% and 4.4% respectively. Copom’s projection for Q1 2027 stands at 3.4%. “The current scenario continues to be marked by de-anchored inflation expectations, high inflation projections, resilience on economic activity and labor market pressures,” said Copom. “Ensuring the convergence of inflation to the target in an environment with de-anchored expectations requires a significantly contractionary monetary policy for a very prolonged period.” TARIFFS HIT TO GDPCapital Economics previously estimated that tariffs would subtract only 0.3-0.5% from GDP over three years, with exemptions lessening the impact further. The less-damaging-than-expected US tariffs on Brazilian goods cheered the financial markets on Thursday, with the Sao Paulo Bovespa stock exchange up nearly 1% in morning trading. “It’s clear that Brazil has been singled out by President Trump and that an agreement to delay or remove the tariffs entirely is looking unlikely. The justifications for the US tariffs are highly political in nature and include Trump’s concerns about the trial of former president [Jair] Bolsonaro,” said Capital Economics. “This may make it hard to appease the US, particularly with trade concessions. Comments from President Lula suggest that he is hesitant to back down and that Brazilian policymakers are against retaliation.” Front page picture: Brazil’s Santos Port in Sao Paulo state and Latin America’s largest Source: Port of Santos authority

BARCELONA (ICIS)–Pressure caused by global overcapacity plus the impact of the tariff war in shifting supply chains mean that more consolidation is required to create strong, global chemical industry leaders, according to the CEO of Austria’s OMV. OMV’s merger of its polyolefins business, Borealis, with Adnoc’s Borouge operations and the addition of Canada’s NOVA Chemicals will create a leader capable of adjusting its manufacturing footprint and supply networks to deal with increasing global competition, according to Alfred Stern. The CEO said the merged group, to be known as Borouge Group International, will have around 70% of its production in feedstock-advantaged regions and one of the industry’s highest proportions of advantaged, premium products. Speaking to ICIS on the sidelines of the company’s second-quarter financial results conference on 31 July, he said the merged group: “Will have a leading suite of technologies [that] will allow us to extract significant synergies of at least $500 million. It will have a truly global footprint, allowing us to supply our customers across the globe and optimise our network.” The deal – which the companies say will create the world’s fourth largest polyolefins player with more than $60 billion in sales – should be closed in the first quarter of 2026 subject to more regulatory clearances. It has already been passed by the EU and China. The merged group will be headquartered in Austria. Stern pointed out that supply chains have shifted in Asia in particular, with the addition of significant capacities over the years, especially in China. He added: “The second piece is the tariff discussions and all these things will change the shape of the industry. This is driving the need for consolidation – look at Europe where significant capacity closures have already happened, and in China they previously said any plant older than 30 years [must close] and now they have reduced that to 20 years, which will take out capacity.” The CEO said that the 1.4 million tonnes/year Borouge 4 project will initially be owned by OMV and Adnoc before being added later to Borouge Group International. Interview by Will Beacham Thumbnail photo: Borealis’ polypropylene plant 5 at its Schwechat, Austria, complex (Source: Borealis)

SINGAPORE (ICIS)–Wacker Chemie recorded a Q2 net loss of €19.2 million year on year due to weak demand amid “trade policy uncertainties”, the German chemicals firm said on Thursday. in € million Q2 2025 Q2 2024 % Change H1 2025 H1 2024 % Change Sales 1,412.9 1,467.9 -3.7 2,891.2 2,957.4 -2.2 EBITDA 114.3 154.7 -26.1 233.6 315.2 -25.9 EBIT -11.3 37.6     – -18.7 89.0     – Net income -19.2 34.8     – -22.6 83.2     – Sales declined in the first half of the year primarily as a result of lower volumes, particularly in the Polysilicon division, Wacker said. The company’s Q2 EBITDA margin stood at 8.1%, down from 10.5% in the second quarter of 2024. “Customer demand in numerous segments remained weak in Q2. Trade policy uncertainties are hampering the economy,” Wacker President and CEO Christian Hartel said in a statement. “There are no signs of a recovery so far, which is why we revised our outlook for 2025 on 18 July,” Hartel added. The company now expects sales in the range of €5.5 billion-5.9 billion for this year, down from €6.1 billion-6.4 billion in its previous forecast. EBITDA for the full year is expected to be between €500 million and €700 million, down from €700 million-900 million.

MUMBAI (ICIS)–Trade negotiations are still ongoing between the US and India, but US President Donald Trump announced in a social media post that 25% tariffs would apply to the south Asian nation starting 1 August. Tariffs to hit $87 billion worth of Indian exports to US US to impose penalties over BRICS, Russian energy imports Exporters worry over higher rates compared with other Asian countries In a post on Truth Social, Trump said said that the US had done relatively little business with India because of the country’s high tariffs and its “strenuous and obnoxious non-monetary trade barriers”. Negotiations have slowed down due to India’s refusal to open up certain sectors like agriculture, and dairy while the US has also imposed additional tariffs on steel and aluminum imports from India. The newly announced tariff rate was just a percentage point lower compared with the initial rate announced by the US in early April. The new tariffs are expected to impact Indian goods exports to the US, which stood at around $87 billion in 2024, especially the garment, pharmaceuticals, gems and jewels, and petrochemicals exports. Trump said his administration was still negotiating the final tariff rate with India. “They [India] have one of the highest tariffs in the world now, they’re willing to cut it very substantially,” Trump during a press conference on 30 July. The proposed US tariffs on India were higher compared with other countries that have concluded trade agreements with the US – 15% for Japan and South Korea; 19% for Indonesia; and 20% for the Philippines and Vietnam. INDIA FACES US PENALTY ON TOP OF TARIFFS In addition to the tariffs, Trump also proposes to impose an unspecified penalty on India for buying energy and military equipment from Russia, as well as for its membership in the BRICS (Brazil, Russia, India, China, and South Africa) group. “They [India] have always bought a vast majority of their military equipment from Russia, and are Russia’s largest buyer of energy, along with China, at a time when everyone wants Russia to stop the killing in Ukraine.” Trump accused the BRICS alliance of countries of being hostile to the US. The BRICS alliance now includes 10 countries, with Egypt, Ethiopia, Indonesia, Iran and the UAE as new members. On 9 July, Trump had said that the US would impose an additional 10% tariff on imports from any countries aligning themselves with the “anti-American policies” of the BRICS. “So, it’s partially BRICS, and it’s partially, the trade situation. We have a tremendous deficit. Prime Minister Modi is a friend of mine, but they don’t do very much business in terms of business with us,” Trump said. “The government has taken note of a statement by the US President on bilateral trade.  The government is studying its implications,” India’s Ministry of Commerce said in response to the tariff announcement by Trump on 30 July. “India and the US have been engaged in negotiations on concluding a fair, balanced and mutually beneficial bilateral trade agreement over the last few months. We remain committed to that objective,” it added The government will protect the welfare of the farmers, entrepreneurs, and micro, small and medium enterprises (MSMEs) the statement said. It indicated that the government intends to secure trade agreements like the latest Comprehensive Economic and Trade Agreement it formalised with the UK. India and the US have been negotiating a bilateral trade agreement (BTA), since February following Prime Minister Narendra Modi’s visit to the US. The US is India’s largest trade partner. In the fiscal year ending March 2025, India had a trade surplus of $41.2 billion with the US, official data showed. Meanwhile, Russia accounted for nearly 35% of India’s oil imports until June 2025, as per official records “The tariffs imposed on India is a little disappointing for us. The penalty President Trump has talked about is also not clear,” Ajay Sahai Director General of Federation of Indian Export Organisations said to Asian News International (ANI) newswire on 30 July. The new tariffs are a “major setback for Indian exporters, especially in sectors like textiles, footwear and furniture, as the 25% tariff will render them uncompetitive against rivals from Vietnam and China,” FIEO president S C Ralhan said. “While this move is unfortunate and will have a clear bearing on our exports, we hope that this imposition of higher tariffs will be a short-term phenomenon and that a permanent trade deal between the two sides will be finalised soon,” Harsha Vardhan president of the Federation of Indian Chambers of Commerce & Industry (FICCI) said. Focus article by Priya Jestin Visit the ICIS Topic Page: US tariffs, policy – impact on chemicals and energy.

LONDON (ICIS)–On 30 July the European Commission published draft terms for its third Innovation Fund hydrogen auction (IF25), outlining a €1.1 billion support package aimed at scaling up renewable and low-carbon hydrogen production across the European Economic Area (EEA). The auction, part of the European Hydrogen Bank (EHB) and scheduled for the fourth quarter 2025, expands eligibility to include both renewable fuels of non-biological origin (RFNBO) and electrolytic low-carbon hydrogen. The IF25 auction will be split across three topics: Topic 1 (€400 million): Open to RFNBO and/or electrolytic low-carbon hydrogen projects Topic 2 (€400 million): Exclusively for RFNBO hydrogen Topic 3 (€200 million): RFNBO and/or electrolytic low-carbon hydrogen projects for supply of the maritime sector, with potential for an additional €100 million via EEA country contributions under the Auction-as-a-Service (AaaS) mechanism Projects will compete for fixed premium payments per kilogram of certified hydrogen produced, with support lasting up to 10 years. The ceiling price is set at €4/kg, and bids will be ranked solely on price. To qualify, projects must demonstrate credible plans for electricity sourcing, hydrogen offtake, electrolyser procurement, and permitting. A minimum electrolyzer capacity of 5MW is required, and only new production capacity is eligible. To secure domestic manufacturing capacity, the auction introduces origin requirements for electrolyzers. At least 75% of electrolyzer units must originate outside China, with further restrictions on key components. Low-carbon hydrogen production must achieve at least 70% greenhouse gas savings compared to fossil fuels. The IF25 auction continues the AaaS model, allowing member states to use national funds for projects that are not granted support from the EHB pot. Germany, Spain, Austria, and Lithuania have previously used this mechanism. Previous rounds were oversubscribed. The second auction received 61 bids, with 15 projects selected for a total of €992 million support. Bid prices ranged from €0.20-0.60/kg for general projects and €0.45-1.88/kg for maritime projects. The first round attracted 132 bids for seven selected projects, dropping to six after one chose not to continue, and total support of around €694 million. Bid prices were between €0.37-0.48/kg. Consultation on the draft terms is open until 14 September.

LONDON (ICIS)–On 28 July, the EU’s Agency for the Cooperation of Energy Regulators (ACER) issued its first formal guidance on how hydrogen network costs should be shared between early and future users, recommending an inter-temporal cost allocation (ITCA) framework. ITCA is a mechanism that allows hydrogen network investors to recover infrastructure costs over time through tariffs. The aim is to avoid burdening early users with high costs while the market is still nascent. Germany’s WANDA scheme is the only operational ITCA model in the EU, though Denmark is developing a similar scheme. In Germany initial revenue shortfalls, due to low early demand and high upfront infrastructure costs, are recorded in an €24 billion amortisation account,  financed by a loan from the country’s state-owned investment bank. Pipeline operators must repay this fund by 2055, or cover 24% of any shortfall, with the state absorbing the rest. In May, Dutch regulators cited the mechanism as a method to prevent soaring transmission costs in the Netherlands. Hydrogen is a key part of the EU’s decarbonisation strategy, but infrastructure investment has not developed as quickly as once expected. High production costs and the uncertain pace of demand materialisation has made it difficult for hydrogen projects to secure private capital. Without mechanisms like ITCA, ACER argues that early-stage tariffs could become prohibitively expensive, deterring uptake. EU-wide network codes for hydrogen are not expected before 2027, leaving member states to design interim rules.

LONDON (ICIS)–On 28 July the German Ministry for Economic Affairs and Energy (BMWE) launched a public consultation for a €400 million bilateral renewable hydrogen auction with Canada. The auction, jointly funded by the German and Canadian governments with €200 million each, will support the import of renewable fuels of non-biological origin (RFNBOs), including renewable hydrogen, ammonia, methanol, and other e-fuels, produced in Canada and sold to offtakers in Germany Unlike previous H2Global tenders, which relied on the intermediary Hintco to purchase hydrogen on long-term contracts with the aim of reselling those volumes at the highest possible price, this auction will directly match Canadian producers with German buyers for up-to 10-year offtake agreements. Hintco will facilitate the matchmaking but will not hold contractual obligations post-award. It will not guarantee delivery by producers or payment by offtakers. Like previous H2Global auctions, the difference between the winning producer’s price ask and the winning offtaker’s payment offer will be subsidised. BMWE has invited stakeholders to respond to a questionnaire outlining the auction design and eligibility criteria. The auction will allow bids based on energy content rather than fuel type. This flexibility is intended to maximise participation and cost-efficiency, with awards favouring suppliers offering the highest energy volumes. The consultation is open until 10 September.

LONDON (ICIS)–Join John Richardson, ICIS senior executive, business solutions group, in Episode 4 of Sustainably Speaking along with Mark Victory and Matt Tudball, senior editors for recycling Europe, and Helen McGeough, global analyst team lead for plastic recycling as they discuss the European Commission’s proposals to allow mass balance for chemical recycling using a fuel-exempt accounting approach under the Single Use Plastics Directive (SUPD), and what this means for the wider recycling world. Plus, how amendments in the draft Implementing Decision allow for recyclate from outside the EU to count towards the 25% recycled content for polyethylene terephthlate (PET) beverage bottles, as well as what is going on in the wider world of recycling. Some questions answered during this episode: Why is this draft Implementing Decision on mass balance so important, and what does ‘fuel-exempt’ mean? Will this increase investment in chemical recycling in Europe and what happens if other regions go for a ‘free allocation’ approach? What’s the impact on global operators working in different markets? Can recyclate made from post-consumer plastic waste placed on third country markets count towards recycled content targets? What does a ‘level playing field’ for Europe look like? Will there be a sudden acceleration of chemical recycling projects as Europe’s crackers close? Is chemical recycling the solution for mass-scale food contact for polyolefins in Europe by 2030?