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Ammonia23-Oct-2024
HOUSTON (ICIS)–Idemitsu Kosan and Mitsubishi
Corporation announced they have agreed to
jointly study the efficient operation of clean
ammonia carriers and transshipment terminals.
The companies said in a statement this effort
will look at ExxonMobil’s planned low-carbon
hydrogen and low-carbon ammonia production
project in Baytown, Texas, as well as the
offtake of ammonia.
Further through this combined effort, Idemitsu
and Mitsubishi Corporation intend on
accelerating their study on structuring a
supply chain for low-carbon ammonia which is
procured from overseas.
Idemitsu, which has established an ammonia
import and receiving terminal at its Tokuyama
Complex, said it aims to jointly introduce over
1 million short tons of ammonia as fuel and raw
materials by 2030 in cooperation with other
companies.
For its part Mitsubishi Corporation said it is
assessing the partial conversion of its
Namikata terminal into an ammonia terminal.
It is also preparing to build a hub terminal
that will supply approximately 1 million short
tons of ammonia annually to various industrial
applications such as electricity,
transportation and chemicals by 2030.
Idemitsu and Mitsubishi Corporation said they
both plan to supply the low-carbon ammonia
volumes produced by this project to Japan
through their receiving terminals.
Ammonia23-Oct-2024
HOUSTON (ICIS)–Fertilizer producer Atlas Agro
and plant nutrient distributor International
Raw Materials have announced a binding
strategic offtake and partnership agreement for
the green nitrogen fertilizer from Atlas Agro’s
Pacific Green Fertilizer plant in Richland,
Washington.
The Pacific Green Fertilizer plant will be the
first at-scale, low carbon fertilizer
production facility in the world with it
planned to produce 700,000 short tons of
nitrogen fertilizer annually and serving
farmers across the Pacific Northwest region.
The facility will be in the Horn Rapids
industrial park in Richland, Washington, and
will produce green nitrogen fertilizers in
liquid and solid form.
Switzerland-based Atlas Agro recently completed
its front-end engineering design (FEED) study
for the project and received the environmental
determination of non-significance from both
state and federal agencies. The final
investment decision (FID) is expected in early
2025.
Atlas Agro’s fertilizer production process will
use proven technologies and be powered by
renewable energy sources with the company
saying low carbon fertilizer products are
essential to sustainable food production and
addressing climate change.
“Our partnership with IRM is a significant
milestone in our progress to bring locally
produced, green nitrogen fertilizer products to
growers in the Pacific Northwest. IRM is a
company renowned for its market knowledge and
logistics capabilities with deep roots in the
Pacific Northwest, and a commitment to bringing
sustainable solutions to the agriculture supply
chain,” said Petter Ostbo, Atlas Agro CEO.
For its part International Raw Materials said
adding the green fertilizer products to their
marketing and distribution portfolio is
well-aligned with the company’s commitment to
agricultural sustainability.
“We’re seeing increased demand for a variety of
solutions across the supply chain as food
companies respond to the needs of consumers and
look for new tools to address their Scope 3
emissions,” said Tip O’Neill, International Raw
Materials president.
Polyvinyl Chloride23-Oct-2024
HOUSTON (ICIS)–Orbia’s vinyls business
reported on Wednesday that Q3 operating income
was flat year on year amid lower costs for
ethylene and electricity as well lower volumes
and prices.
The following shows the financial performance
of the company’s Polymer Solutions segment,
which includes the Vestolit and Alphagary
businesses. Figures are in millions of dollars.
Q3 24
Q3 23
% Change
total sales
634
677
-6%
Operating income
23
23
0
EBITDA
90
86
5%
Source: Orbia
Orbia attributed the rise in the segment’s
EBITDA to lower costs as well as the company’s
efforts to optimize production and fixed costs.
Orbia attributed the declines in volumes to
challenging business conditions.
COMPANY LOWERS
GUIDANCEFor Orbia as a whole,
the company expects to report $1.10 billion to
$1.15 billion in earnings before interest, tax,
depreciation and amortization (EBITDA), down
from
its earlier guidance of $1.30 billion.
Orbia lowered its guidance because the market
had not recovered as the company had expected.
The company’s other segments include the
following:
Building & Infrastructure, which
includes the Wavin business. It makes pipes and
fittings.
Connectivity Solutions, which includes the
Dura-Line business. It makes telecommunications
conduit, cable-in conduit and similar products.
Precision Agriculture, which includes the
Netafim business. It makes irrigation systems.
Fluor & Energy, which includes the
Koura business. It mines fluorspar and makes
fluorine derivatives.
Thumbnail shows PVC pipe. Image by
Shutterstock.
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Speciality Chemicals23-Oct-2024
LONDON (ICIS)–The overall winner of this
year’s ICIS Innovation Awards – BASF, Linde and
SABIC’s electrically heated steam cracker
furnace – could have a massive impact on
overall chemical industry emissions if the
technology is widely adopted.
World’s first electrically heated steam
cracker at demonstration stage
Cuts CO2 emissions by up to 95% compared
with natural gas-fired crackers
Tripartite win shows strength of
partnerships
Challenges include obtaining sufficient
renewable energy, financing for scale up
Financial risks can be reduced by
converting one furnace at a time
In this Think Tank podcast, Will
Beacham
interviews Michael Reitz,
technology manager for BASF and Martin
Hofstaetter, process engineer for
furnace technology at Linde.
Register your
interest to enter the 2025 ICIS Innovation
Awards.
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.
Crude Oil23-Oct-2024
SINGAPORE (ICIS)–Emerging Asian economies are
expected to see strong economic growth subside,
partly due to a sustained slowdown in China,
the International Monetary Fund (IMF) said on
Tuesday.
China’s 2024 growth forecast lowered to
4.8%
Downside risks dominate global outlook
China property risks may trigger global
impact
The IMF trimmed its forecast for emerging and
developing Asian economies by 0.1 percentage
points to 5.3% and 5.0% for this year and 2025,
respectively, slowing from the 5.7% expansion
in 2023.
In India, the outlook on a fiscal year basis is
for GDP growth to moderate from 8.2% in 2023 to
7% in 2024 and 6.5% in 2025, “because pent-up
demand accumulated during the pandemic has been
exhausted, as the economy reconnects with its
potential”, the IMF said.
For China, the IMF downgraded its projection
for this year by two-tenths of a percentage to
4.8% from its 5% estimate in July. This is
lower than China’s official growth target of
around 5% for this year.
The IMF’s China growth forecast for 2025 was
unchanged at 4.5%.
However, the slowdown in China is projected to
be more gradual despite persisting weakness in
the real estate sector and low consumer
confidence, it said, largely thanks to
better-than-expected net exports.
The IMF’s chief economist Pierre-Olivier
Gourinchas at a press conference on Tuesday
said in its latest forecasts that China’s
fiscal stimulus measures so far lacked detail
and therefore were not included in the China
growth outlook.
China’s central bank stimulus measures,
unveiled last month to spur lending, “would do
little to materially lift growth”, Gourinchas
was quoted by news agency Reuters as saying.
China’s economic
forecast remains bleak, despite the
government’s stimulus measures announced in
late September, which briefly boosted market
sentiment.
China on 18 October reported year-on-year
GDP growth of 4.6% in the second quarter,
the slowest pace since early 2023, while
overall growth in the first nine months of 2024
stood at 4.8%.
China’s latest measures are insufficient to
address its economic woes, economists have
warned, and the IMF notes that significant
risks remain, particularly in the troubled
property sector.
“Conditions for the real estate market could
worsen, with further price corrections taking
place amid a contraction in sales and
investment,” the IMF said.
“The experiences of Japan in the 1990s and the
United States in 2008 suggest that a further
price correction is a plausible downside risk
if the crisis is not adequately addressed.”
GLOBAL REPERCUSSIONS OF CHINA’S
SLOWDOWN
A prolonged or severe downturn in China’s
property market, especially one that triggers
financial instability, could dampen consumer
confidence and negatively impact the global
economy due to China’s significant role in
international trade, the IMF warned.
With China’s economy softening, global growth
is expected to be a lackluster 3.1% in five
years – a notch down from the pre-pandemic
average, it said.
Growth is projected to hold steady at 3.2% in
2024 and 2025, but some low-income and
developing economies have seen sizable downside
growth revisions, often tied to intensifying
conflicts.
The IMF’s Gourinchas in a separate blog post
said that downside risks are increasing and now
dominate the global economic outlook.
“An escalation in regional conflicts,
especially in the Middle East, could pose
serious risks for commodity markets,” he said.
Global output could be significantly lower than
the IMF’s baseline forecast due to shifts
toward undesirable trade and industrial
policies, overly tight monetary policy, or an
abrupt tightening of global financial
conditions, Gourinchas added.
Focus article by Nurluqman
Suratman
Ethylene22-Oct-2024
LIMA (ICIS)–Brazil’s GDP is expected to grow
by 3% in 2024, up sharply from prior forecasts
of 2.1% growth published in July,
the IMF said this week.
Mexico’s growth, however, is expected to slow
down to 1.5%, down sharply from the previous
2.2% forecast.
For the Latin America and the Caribbean region
as a whole, growth is projected at 2.1% in
2024, slightly up from the 1.9% forecast
published in July, said the IMF.
“[Brazil’s GDP growth forecast] is an upward
revision … owing to stronger private
consumption and investment in the first half of
the year from a tight labor market, government
transfers and smaller-than-anticipated
disruptions from floods,” said the IMF.
“However, with the still-restrictive monetary
policy and the expected cooling of the labor
market, growth is expected to moderate in
2025.”
The more conservative forecast for the Mexican
economy reflects weakening domestic demand on
the back of monetary policy tightening, said
the IMF, who projected the country’s growth
would continue slowing down in 2025.
The Fund expects Argentina’s GDP to fall by
3.5% this year, a forecast considerably
more
optimistic than most economists.
For detailed country-by-country figures see
bottom table.
INFLATION BATTLE WON –
MOSTLYThe IMF celebrated how for
most countries in Latin America and the
Caribbean inflation rates have dropped
significantly from their peaks and continue to
be on a downward trend.
The Washington-based body highlighted, however,
how in some countries inflation is ticking up
on the back of, among other factors, weather
events, which can suddenly push prices for
agricultural products.
“Large countries in the region have experienced
upward revisions since the April 2024 World
Economic Outlook that reflect a mix of 1)
robust wage growth preventing faster
disinflation in the services sector (Brazil,
Mexico); 2) weather events (Colombia); and 3)
hikes in regulated electricity tariffs
(Chile),” said the IMF.
“[For example] Coffee prices rallied, rising by
33.8%, following weather-related supply
concerns in key producers Brazil and Vietnam.”
Despite adverse weather
events, Brazil’s national supply
corporation Conab said earlier in October that
the 2024-2025 fertilizers-intensive
agricultural season is set
to reach a record high.
Conab is forecasting grain production to reach
322.47 million tonnes in the 2024-2025 harvest,
up 8.3% compared with the previous harvest.
IMF forecasts (in %
change)
GDP growth 2023
GDP growth forecast 2024
GDP 2025 growth forecast
Inflation 2023
Inflation forecast 2024
Inflation forecast 2025
Brazil
2.9
3.0
2.2
4.6
4.3
3.6
Mexico
3.2
1.5
1.3
5.5
4.7
3.8
Argentina
-1.6
-3.5
5.0
133.5
229.8
62.7
Colombia
0.6
1.6
2.5
11.7
6.7
4.5
Chile
0.2
2.5
2.4
7.6
3.9
4.2
Peru
-0.6
3.0
2.6
6.3
2.5
1.9
Ecuador
2.4
0.3
1.2
2.2
1.9
2.2
Venezuela
4.0
3.0
3.0
337.5
59.6
71.7
Bolivia
3.1
1.6
2.2
2.6
4.3
4.2
Paraguay
4.7
3.8
3.8
4.6
3.8
4.0
Uruguay
0.4
3.2
3.0
5.9
4.9
5.4
Latin America and the
Caribbean
2.2
2.1
2.5
14.8
16.8
8.5
Ethyl Acetate22-Oct-2024
HOUSTON (ICIS)–Sherwin-Williams expects demand
during the first half of 2025 will remain
choppy while the company waits for what it
expects will be an inevitable inflexion point
for demand for its products, the US-based
paints and coatings producer said on Tuesday.
“The single largest variable heading into next
year is the timing and pacing of a true
inflexion in the demand environment,” said
Heidi Petz, CEO. She made her comments during
an earnings conference call. “It is only a
question of when, not if.”
Until that inflexion comes, Sherwin-Williams
expects demand will remain choppy.
During the third quarter, demand from consumers
undertaking do-it-yourself (DIY) improvement
projects remained soft,
a trend also noted by RPM International, a
company that makes coatings, adhesives and
sealants.
Sherwin-Williams attributed the softness for
its DIY products to weaken existing home sales
and inflation.
For auto refinish products, insurance claims
have fallen because consumers are reluctant to
pay deductibles to get their vehicles repaired
after accidents, Petz said.
PPG also
noted a decline in insurance claims.
Near term, Sherwin-Williams warned about the
possibility that its industrial customers could
undergo extend holiday shutdowns.
The company did not provide more details.
However, US-based paints and coatings producer
PPG did note that automobile original equipment
manufacturers (OEMs)
started taking unscheduled and prolonged
downtime in the third quarter, and the
trend should continue in the fourth quarter.
DEMAND FROM HURRICANE
REPAIRSHurricanes initially
lower demand because they shut down paint
stores and customers cannot immediately return
to work.
Ultimately, demand does rise after customers
assess damage and pursue insurance claims.
After about four weeks, demand for primers
increases, Sherwin-Williams said. Sundries and
paint then follow.
Forecasting the effects of Hurricanes Helene
and Milton are difficult because they hit weeks
apart in the third and fourth quarters.
TALK OF RENOVATION
RESURGENCELonger term, the US
could see a resurgence of home renovation
projects, said Jim Jaye, senior vice president
of investor relations.
One of the economic indicators tracked by
Sherwin-Williams is
the Leading Indicator of Remodeling
Activity (LIRA), which is published by the
Joint Center for Housing Studies of Harvard
University.
According to LIRA, spending for improvements
and repairs on homes should expand once again
by the middle of 2025.
Economic growth, expected declines in inflation
and higher home equity could encourage
homeowners to undertake repairs and remodeling,
he said.
Paints and coatings are important end markets
for many petrochemicals and resins.
Titanium dioxide (TiO2) is used as a white
pigment and to make paints opaque.
Solvents used in paints and coatings include
ethyl acetate (etac), butyl acetate (butac) and
methyl ethyl ketone (MEK).
Polyurethane coatings are made with polyols and
isocyanates such as methyl diphenyl
diisocyanate (MDI). Acrylic based coatings are
made with methyl methacrylate (MMA), and epoxy
coatings are made with epoxy resins.
Other chemicals used in paints and coatings
include isopropanol (IPA) and vinyl acetate
monomer (VAM).
Thumbnail shows paint, one of the products
made by Sherwin-Williams. Image by Oleksandr
Latkun/imageBROKER/Shutterstock.
Acrylonitrile Butadiene Styrene22-Oct-2024
LONDON (ICIS)–Markets Editor Stephanie Wix is
joined by Senior Editor Manager Vicky Ellis,
markets reporter Meeta Ramnani, and Senior
Analyst Jincy Varghese, as they discuss the key
trends from the 29th Fakuma plastics processing
trade fair in Friedrichshafen, Germany, in this
latest ICIS podcast.
They explore discussion topics heard at the
event last week, from the highest concerns to
the lowest expectations. They also explain the
clash of pessimism and optimism between markets
including acrylonitrile butadiene styrene
(ABS), polycarbonate (PC), polyethylene (PE)
and polypropylene (PP), and also engineering
plastics polyacetal (POM) and polybutylene
terephthalate (PBT).
Gas22-Oct-2024
EU energy policy must be less ideological
in next five years, GIE conference hears
Lowering high energy prices, which harm
industry, a key goal for incoming Commission
Commissioner confirmation hearings to take
place 4-12 November
MUNICH (ICIS)–The incoming European Commission
must move away from ideological energy policy
if it hopes to stabilize prices and keep
industry competitive, delegates heard at the
Gas Infrastructure Europe (GIE) conference in
Munich on 17-18 October.
However, despite an announced focus on a ‘clean
industrial deal’, doubts remain that Europe can
apply the lessons learned from the energy
crisis.
Speaking to ICIS on the sidelines, Tsvetelina
Penkova, vice-chair of the European
Parliament’s energy and industry committee said
the thought the upcoming commissioner hearings
would be “dynamic”, though she hoped the
meetings would be constructive rather than
unpleasant.
Nominated commissioners must be confirmed by
the European Parliament before they can take up
their roles. Hearings are scheduled for 4-12
November.
“The problem is quite a lot of topics are
overlapping [in commissioners’ portfolios], so
it’s very difficult to distinguish exactly the
area of expertise,” she said, citing concerns
over who would ultimately be responsible for
decisions and the time involved if multiple
people sign off policies.
Penkova told delegates that fluctuations in
energy prices between different regions harmed
competitiveness and energy security.
The discrepancy “really depends on the energy
source that’s being used at the moment,” she
said, as a lack of proper grid interconnections
created bottlenecks, and without fixing this
Europe’s energy landscape would remain
dominated by local, regional or national
solutions.
The topic of surging heatwave-driven power
prices experienced in central and southeastern
Europe also dominated a meeting of EU
energy ministers in Luxembourg on 15
October.
Penkova called for energy resilience as well as
a diversity of sources, including renewables,
hydrogen, ammonia and other carriers, alongside
storage and flexibility solutions.
“We must understand that dependency only on one
single sector or energy source is naive. That’s
definitely not going to work,” she said.
GIE president-elect Arno Bux stressed to
delegates that gas infrastructure would remain
vital for decades to come, citing nascent
hydrogen, biomethane and carbon dioxide
markets.
“We all know pipelines … are by far the most
efficient way to transport and store energy,”
he said.
But the industry was hindered by 1990s-era
regulation, Bux said, which failed to foresee
the need to maintain and expand infrastructure
under uncertain conditions or the costs
involved.
NUCLEAR SCEPTICISM?
Penkova dismissed concerns over nuclear
skepticism previously voiced by the nominees
for energy commissioner,
Denmark’s Dan Jorgensen, and executive
vice-president Teresa Ribera from Spain, tasked
with delivering the ‘clean, just and
competitive transition’.
Noting that the parliament considered nuclear
generation as strategic and sustainable
technology, Penkova told ICIS she didn’t
foresee any change in Europe’s policy, but
instead hoped for better integration.
“When we’re speaking of nuclear waste, we
shouldn’t be looking only [at] the countries
that are producing nuclear energy, but also at
countries that are consuming [it], because we
are all part of the waste creation,” she said.
CLEAN AND INDUSTRIAL
Ilaria Conti, gas expert and coordinator for
strategy and development at the Florence School
of Regulation, told delegates it was important
the EU had not watered down its commitment to
decarbonize, instead aiming to use
industry as the “engine” of the transition.
The shift followed the results of European
parliamentary elections in June, which saw a
perceived backlash against green policies.
“The election results forced people to realise
that achieving climate neutrality targets on
time but losing the economy and the electorate
along the way was unhelpful, ” said Niko
Bosnjak, head of policy and communication at
the German grid operator OGE.
Bosnjak said he worried that there was less
urgency for policymakers to act since the
pressure had eased, despite net-zero goals
rapidly approaching.
“I’m afraid we’re getting into the regular
slump that we’ve been in before. I’m not saying
I’m all for crises, ok? I think no one wants
that, but we need to do better a better job in
translating the learnings,” he said.
For example, Bosnjak wondered why there was not
middle ground between the 9-month construction
of an LNG-import pipeline during the crisis and
the return to an average of 6-8 years to build
infrastructure.
Conti said she thought plans to make the
Commission more interdependent was “actually in
my opinion a very smart move by Ursula von der
Leyen.”
The overlapping briefs
would hopefully force incoming commissioners to
cooperate, Conti said, breaking down past silos
where each commissioner focused only on their
own portfolio.
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