LONDON (ICIS)–Shell has scrapped plans to complete an 820,000 tonne/year biofuels complex in Rotterdam, the Netherlands, after deeming the project “insufficiently competitive”, the company said on Wednesday. The UK-headquartered oil and gas major suspended work on the flagship project in mid-2024, not long before the expected completion period for the facility, after making a final investment decision to develop the plant in 2021. The company estimated it would book an impairment of $600 million to $1 billion in its second-quarter 2024 results due to the move to suspend work on the Rotterdam project. The decision not to move forward with the project, which would have been among the largest biofuels facilities in Europe, was driven by the projected economics of the completed plant, according to the company. “As we evaluated  market dynamics and the cost of completion, it became clear that the project would be insufficiently competitive to meet our customers’ need for affordable, low carbon products,” said Machteld de Haan, Shell’s president for downstream, renewables and energy solutions. The cancellation of the project comes despite the introduction of the European Commission’s sustainable aviation fuels (SAF) mandate, which mandates a floor for the amount of bio-based content in fuels at EU airports from this year. Under the mandate, minimum SAF content in airport fuels is expected to tick up from 2% in 2025 to 6% in 2030,ratcheting up to 20% by 2035. Spain-based player Cepsa is currently constructing a 500,000 tonne/year biofuels plant in Huelva in the country, with the €1.2 billion project expected to be completed by next year. Thumbnail image shows Shell building in Rotterdam, the Netherlands. Image credit: Shutterstock

SINGAPORE (ICIS)–Mura Technology will develop a 50,000 tonne/year advanced recycling facility on Singapore’s Jurong Island, the UK recycled plastics producer announced on 28 August. Mura’s plant will be located within the Singapore Essential Chemicals Complex (SECC) on Jurong Island, on a site leased from Singapore’s PCS. The plant, which can increase its capacity up to 100,000 tonnes/year, will utilize Mura’s Hydro-PRT technology that converts plastic waste into circular hydrocarbon products, which can then be used to create virgin-quality recycled plastic materials, the company said. Mura aims to process over 60,000 tonnes/year of plastic waste, supporting Singapore’s ambitions of increasing the country’s overall recycling rate to 70% by 2030. “As the region’s premier hub for trade, innovation, and circular economy leadership, Singapore provides the ideal platform for Mura’s new facility to recycle both local and regional plastic waste into premium, circular feedstocks,” Mura said in a statement. Financial details were not disclosed. The facility is part of a growing investment in circular plastics across southeast Asia, amid “tightening plastics circularity rules, growing brand commitments and consumer pressure”, said Bala Ramani, director of sustainability consulting and Asia strategy advisor at ICIS. With integrated petrochemical infrastructure and proximity to multinational firms targeting “ambitious sustainability agendas”, the project also reflects Singapore’s strategic advantages in the field, said Ramani. “The outlook for this investment will be influenced by the consistency of plastic waste feedstock, not only in terms of sufficient volumes but also the quality required for stable plant operations,” Ramani added.

HOUSTON (ICIS)–The US corn crop has reached a maturity rate of 15% with 11% of the soybean crop having dropped their leaves according to the latest crop progress report from the US Department of Agriculture (USDA). The amount of crop maturity more than doubled week on week but trails the 18% level from 2024 and is ahead of the five-year average of 14%. Corn at the dough stage is now at 90%, which is above the 89% from last season but is behind the five-year average of 91%. Corn that is now dented climbed to 58%, which is equal to the 58% level in 2024 but trails the five-year average of 60%. For corn conditions the acreage rated as very poor is up to 3% with 6% still listed as poor. The crop seen as fair has increased to 22% with the level as good down to 50% and excellent decreased at 19%. The first update on the US corn harvest will be released by the USDA next week. The soybean crop now setting pods has lifted to 94%, which is ahead of the 93% mark in 2024 and matches the five-year average of 94%. The amount of the crop dropping leaves is up to 11%, which lags the 12% achieved last season but is ahead of the five-year average of 10%. For soybean conditions the crop viewed as very poor is up to 3% with very poor increased to 7% and fair having lifted to 25%. The acreage listed as good declined to 51% with the level of excellent down to 14%. Spring wheat harvest is now 72% completed with sorghum harvest at 17%.

NEW YORK (ICIS)–Global chemical supply/demand fundamentals could “tighten materially” if meaningful plant shutdowns take place, said a Wall Street analyst. “After three consecutive years of earnings compression, fatigue has certainly set in with many global companies taking the bold step of permanently shuttering capacity,” said Hassan Ahmed, analyst at Alembic Global Advisors, in a research note. “Our analysis suggests that if all these capacity shutdown announcements do actually materialize, we could get to peak global utilization rates as early as 2028 (stress on the word ‘if’),” he added. The analyst pegs all announced ethylene capacity shutdowns at 7.8 million tonnes/year between 2025 and 2028, including South Korea’s recent announcement that its petrochemical company’s plant to shut down 2.7-3.7 million tonnes/year of ethylene capacity. “Beyond already announced shutdowns, we see around 10.5 million tonnes of planned capacity addition projects as being ‘at risk’ of cancellations,” said Ahmed. China has four ethane-based crackers accounting for 3.7 million tonnes/year of ethylene capacity that could be shut down in an “aggressive tariff environment” as they are entirely dependent on US ethane, he pointed out. China also has 11 million tonnes/year of mixed feed ethylene capacity which could switch to naphtha feedstock in the absence of cheap propane imports. This could result in another 1.7 million tonnes/year of lost ethylene production, the analyst said. “Finally, there is increased speculation that China may rationalize old and subscale ethylene facilities – we peg this shutdown figure at around 6.1 million tonnes,” said Ahmed. “If all these shutdowns were to materialize (29.8 million tonnes) the 2024-2029 global ethylene supply growth CAGR (compounded annual growth rate) would be a meager 0.8% and global utilization rates could exceed tightness levels of 90% as early as 2028,” he added. However, in the meantime, the Alembic Global Advisors analyst slashed 2025 and 2026 earnings per share (EPS) estimates on ethylene-exposed producers Dow, LyondellBasell and Westlake. Ahmed took down his 2025 EPS estimate on Dow to -$0.90 from $0.10 and his 2026 forecast to $0.60 from $1.45. For LyondellBasell, he pared his 2025 EPS estimate to $2.70 from $3.35 and his 2026 forecast to $4.75 from $5.40. The analyst cut his 2025 EPS estimate on Westlake to $0.15 from $0.35 and his 2026 forecast to $3.40 from $3.60. Thumbnail photo of polyethylene (PE) pellets by Shutterstock

LONDON (ICIS)–The phosphates market has seen some activity recently, with China resuming phosphates exports and import demand from Ethiopia and Bangladesh. However, affordability remains an issue for the market, especially in India. Meanwhile, ammonia availability remains tight globally, with planned and unplanned shutdowns. Senior editors Chris Vlachopoulos and Sylvia Traganida discuss the latest developments in the markets and the short-term outlook.

HOUSTON (ICIS)–Here are the top stories from ICIS News from the week ended 29 August. Some lubricating oil codes fall under US steel tariffs Base oils are exempt from US tariffs, but some lubricant products will be affected. Some trade codes that include lubricating oils and preparations are included in the 50% tariffs on steel, aluminum and derivatives imposed under Section 232, as published in the Federal Register last week. ICIS Economic Summary: US set for moderate growth as trade deals offer some certainty The last month has seen more “deals” made with additional major US trading partners. Deals have yet to be made with China, Canada, Mexico and India, but those made cover roughly three-fourths of US trade. Progress thus far has brought some certainty back to markets and decision-makers, but our base case is for a slowdown in the US economy. UPDATE: RAIL: New service from US railroads BNSF, CSX could be a better option than merger – ACD US railroads BNSF and CSX are offering several new intermodal services designed to offer seamless, efficient connections from coast to coast, an alliance that is supported by the head of the chemical distributors association. INSIGHT: Proposed US biofuel mandate to raise costs for fuel, oleo markets The new biofuel mandate proposed by the US calls for larger amounts of renewable fuel to be blended into gasoline and diesel, all while penalizing companies that import biofuels or the feedstock needed to make them domestically. EU proposes to cut US import duties to zero on plastics, rubber, fertilizers The European Commission has set out its first detailed proposals to cut tariffs on US products flowing to Europe as negotiators continue to flesh out the terms of the US-EU trade deal agreed last month. INSIGHT: Chemical companies seek liquidity with infrastructure assets, but it will not be easy Monetizing ‘hidden’ assets such as infrastructure for chemical producers appears to be an increasingly attractive option, especially amid the prolonged industry downturn and depressed valuations for publicly traded companies.

LONDON (ICIS)–Click here to see the latest blog post on Chemicals & The Economy by Paul Hodges, which looks at key challenges for the autumn. Editor’s note: This blog post is an opinion piece. The views expressed are those of the author and do not necessarily represent those of ICIS. Paul Hodges is the chairman of consultants New Normal Consulting.

LONDON (ICIS)–Here are some of the top stories from ICIS Europe for the week ended 29 August. EU proposes to cut US import duties to zero on plastics, rubber, fertilizers The European Commission has set out its first detailed proposals to cut tariffs on US products flowing to Europe as negotiators continue to flesh out the terms of the US-EU trade deal agreed last month. Germany’s Evonik spins out infrastructure activities in Marl and Wesseling into new firmEvonik is spinning out its infrastructure activities in Marl and Wesseling chemicals parks to become new companies, the German firm said on Thursday in a statement. INSIGHT: How the shift to EVs and lightweighting are impacting automotive plastic useThe shift towards electric vehicles (EVs) currently taking place in Europe should ostensibly mean a boon for plastic markets serving the sector. EVs use significantly more plastic than cars run on internal combustion engines (ICEs). However, a trend towards lightweighting, and cost-saving measures, mean that some plastics may not see as large a growth in use as others. INSIGHT: Softer crude oil, seasonal low demand to drive Europe chemical prices down in August The majority of European petrochemical prices are expected to fall in August, driven by lower crude oil values and persistently subdued downstream demand. India’s Paradeep Phosphates secures 1.6 million-tonne agreement with Morocco’s OCP India’s Paradeep Phosphates Ltd (PPL) has announced a significant long-term supply agreement with Morocco’s OCP, securing 1.6 million tonnes of phosphate rock.

SINGAPORE (ICIS)–South Korea’s petrochemical shipments fell by 18.7% year on year to $3.38 billion in August, while semiconductor and automobile exports hit all-time highs for the month, official data showed on Monday. Overall exports growth slows to 1.3% year on year as US tariffs weigh Exports to the US fall 12%, largest drop since May 2020 August manufacturing PMI rises slightly to 48.3 – S&P Global Petrochemical exports in August fell largely due to falling product prices amid declining international oil prices, South Korea’s Ministry of Trade, Industry and Energy (MOTIE) said in a statement. The country’s overall exports rose by 1.3% year on year to $58.4 billion in August, down from the 5.8% growth in July, while imports fell by 4.0% year on year to $51.9 billion. The trade balance stood at a surplus of $6.51 billion in August, narrowing from July’s $6.61 billion. Semiconductors reached a historic high in August, up 27.1% year on year to $15.1 billion, the second consecutive month of record growth. The surge was driven by “favorable trends” in memory chip prices, and sustained demand for high-value memory products. Exports of automobiles also recorded a historic high in August, growing 8.6% year on year to $5.50 billion, as exports of hybrids, electric vehicles (EVs) and used cars all grew. Ship exports in August also grew 11.8% year on year to $3.14 billion amid deliveries of vessels ordered at high prices in 2022-2023. Exports grew in August to three out of nine major regions, including the Association of Southeast Asian Nations (ASEAN), the Middle East, and the Commonwealth of Independent States (CIS). August shipments to ASEAN reached a record high, growing 11.9% to $10.9 billion amid exports of semiconductors and ships. However, exports to both the US and China declined, with US shipments dropping 12.0% year on year and China shipments down by 2.9%. Declines in automobiles, general machinery and steel drove the decrease in US exports after hefty 50% tariffs on steel and aluminum were levied by US President Donald Trump. A 15% levy on South Korean goods also came into effect from 7 August, following a trade deal struck by the two countries, but an agreement to reduce auto tariffs to 15% from 25% has not been ratified. MANUFACTURING DECLINEFactory activity in South Korea continued to contract in August as the manufacturing purchasing managers’ index (PMI) rose slightly to 48.3 from 48.0 in July, according to data released by S&P Global on Monday. A number below 50 signifies contraction and the manufacturing sector has contracted for the seventh successive month, S&P Global said. “Both output and new orders remained in contraction territory, with both metrics little-changed from those seen in July,” said Usamah Bhatti, Economist at S&P Global Market Intelligence. Manufacturers reported challenging domestic economic conditions as well as the US tariff impact, which reduced both sales and production levels. However, the production outlook for the year ahead was positive with hopes of economic improvement, said S&P Global. “The degree of optimism was moderate, with hopes centred on the launch and mass production of new products and an alleviation of domestic economic malaise. There was concern noted, however, regarding the timing of any recovery and the potential prolonged impact of US tariffs,” said Bhatti. GOVERNMENT ANNOUNCES MORE MEASURESSouth Korea’s Minister of Trade, Industry and Energy Kim Jung-kwan said in a statement that the government will prepare “reliable and tangible policies” following feedback from export companies amid tough conditions and US tariffs. “To minimize damage to small and medium-sized enterprises caused by US tariff measures, we plan to announce and implement support measures,” Kim said. The measures will focus on easing management burdens, maintaining export momentum with market diversification and strengthening the competitiveness of “key and promising” industries, said Kim. Previously, the government said it will announce measures to help the ailing petrochemical industry but warned that companies needed to voluntarily restructure their operations as well as cut their overall annual naphtha cracking capacity by up to 3.7 million tonnes. Thumbnail photo shows trade cargo containers at Busan port, Korea (Source: YONHAP/EPA-EFE/Shutterstock) Focus article by Jonathan Yee