HOUSTON (ICIS)–The 90-day pause on reciprocal tariffs on all imports from China provided importers with a new deadline, but not much relief, according to a survey of more than 100 small-to-midsized businesses. Conducted by online freight shipping marketplace and platform provider Freightos between 14-17 May, respondents to the survey said the pause has done little to ease their concerns. Small importers remain deeply anxious, are shifting behavior – including changing shipment timing or even considering winding down businesses – and are starting to adapt for the long term. “While some are assessing domestic manufacturing, very few actually have,” Freightos said when noting key takeaways from the survey. “Meanwhile, delays in shipments as a result of tariffs led to significant gaps that importers are struggling to fill,” Freightos said. Other findings include: 31% of respondents are more concerned now than in April; 48% are equally as concerned; 20% less concerned 42% of importers rated the degree to which their business was disrupted as a full 10/10 disruption score, with an average rating of 7.5/10; down from April, when a full 60% of importers rated their degree of disruption as a 10/10 Some respondents said that they were unable to import goods as the 30% tariffs were still too high for small businesses, that expenses shot up leaving importers upside down on some deals, and that they see no way to plan ahead amid what seemed like daily changes and confusion. ADAPTING Respondents said they have found ways to adapt to the changing environment, including: 47% paused shipments and are now increasing imports following the reprieve’s implementation 15% changed suppliers as a result of the changes 7% decreased imports as a whole Since many businesses delayed shipments in April and are now urgently shipping to restock, there is increased potential of bullwhip effects that lead to persistent disruptions regardless of tariff changes going forward, Freightos said. DOMESTIC SOURCING While one of the stated goals of the tariffs was to change US sourcing patterns, changes remain minimal – 30% of businesses are considering it and only 6% have actually done so, the survey showed. The slight shift in sourcing patterns and the pauses in ordering from China likely contributed to reduced traffic at the West Coast ports of Los Angeles and Long Beach. Kip Louttit, executive director of the Marine Exchange of Southern California (MESC), said the ports of Los Angeles and Long Beach are seeing fewer arrivals than normal. Only 92 container ships arrived in Los Angeles and Long Beach between 1-19 May, whereas 108 would be normal, Louttit said. He also noted about 40 container ship blank sailings that will skip Los Angeles or Long Beach through 5 July. Blank sailings are when an ocean carrier cancels or skips a scheduled port call or region in the middle of a fixed rotation, typically to reduce capacity to support freight rates. Container ships and costs for shipping containers are relevant to the chemical industry because while most chemicals are liquids and are shipped in tankers, container ships transport polymers, such as polyethylene (PE) and polypropylene (PP), are shipped in pellets. Titanium dioxide (TiO2) is also shipped in containers. They also transport liquid chemicals in isotanks. Thumbnail image by Shutterstock

Additional reporting by Andreas Schroeder, Eduardo Escajadillo and Ghassan Zumot CCS could prove a game-changer for Germany’s long-term energy vision Easing of debt brake could stimulate demand in new sectors Debate around resurrecting Nord Stream may be unhelpful now LONDON (ICIS)–Germany’s long-term energy policies are likely to witness critical adjustments as the new government will be looking to strike a balance between climate action, security of supply and economic competitiveness. Speaking to ICIS, Timm Kehler, CEO of Zukunft Gas, Germany’s foremost gas advocacy group, said the new administration remains committed to the country’s 2045 climate neutrality target but the means to achieve the goals are likely to undergo a sea-change. The new government has already announced its decision to lift a long-standing opposition to nuclear production, which is set to ensure the technology is treated on a par with renewable energy in EU legislation. Another game-changer might be the approval of carbon capture storage which would allow Germany to carry out plans to import gas and build gas-fired power plants while being able to transport and export carbon dioxide. OPPORTUNITIES Kehler said there are discussions on lifting the current ban on CCS and aligning with the London Protocol, an international agreement regulating the export of waste including CO2, which will provide clear signals for Germany to use gas while remaining committed to climate targets. This would open the door to a variety of opportunities including securing natural gas supplies on a longer-term basis and continuing to burn the fuel in critical sectors if it is used as feedstock for clean blue hydrogen, with the resulting carbon dioxide stored in CCS. One area that will be under scrutiny will be the decarbonization of heating, the second largest gas consuming sector after industry, which burns around 254TWh (24billion cubic meters) annually. “The decarbonisation of the heating sector is an emotional and complicated issue,” Kehler said. “It was a major breaking point of the previous government and has created headaches in the business because it’s not clear how they would tackle issues. There is a campaign to get rid of gas-fired heating but it’s not clear what that means in practice.” STIMULATING DEMAND Kehler said the ability of the current government to ease the debt brake and pave the way for a multi-billion-euro stimulus for investments in infrastructure, including energy, would implicitly lift demand for natural gas and electricity. Several areas of growth could include the construction sector, where Germany has been falling significantly below targets to expand the housing stock. Another area would be defence. “We see a shift towards investments in defence which could have an impact on the German economy,” he said. “The Coalition Treaty [an agreement signed by Germany’s mainstream centre right and centre left parties CDU/CSU and SPD] focuses on lead markets where the state has influence and which could decarbonise quicker such as green steel and defence technology, which could be a driver for new economic activity,” he added. Kehler said some sectors such as the chemical industry which was severely hit by rising energy costs in the wake of Russia’s invasion of Ukraine have seen a modest comeback but added that a share of the production that closed down or relocated may be lost for now. IMPORTS Despite the economic difficulties faced by Germany following the energy crisis of 2022, he questioned the viability of a possible regulated industrial price for electricity or gas that would help consumers to reduce costs. He said a more efficient option would be to reduce taxes to a minimum level rather than subsidise grid transmission tariffs to keep costs low. The expected surge in gas production globally could bring additional benefits to industrial consumers and Kehler believes that closer relations with the US, as the world’s largest exporter of natural gas, could be beneficial both economically and politically. He said current discussions on the potential return of Russian gas supplies via the idled Nord Stream 1 or 2 corridors were not particularly helpful. “From the point of view of supply we have lots of idle routes through Ukraine or Yamal [via Belarus and Poland] and before we have a discussion on Nord Stream we should put the focus on those transport routes in case Russian gas comes online. “However, we don’t see that [the return of Russian gas] happening, in fact we see the EU discussion moving in opposite direction [towards banning Russian gas imports],” he added. Kehler admitted that natural gas was very much part of the geopolitical discussions between the US and Russia and related to the future of Ukraine in a post-war scenario.

Hals Agro became the second company to inject biomethane into Ukraine’s gas grid Second plant in Kyiv to double capacity by end of 2025 amid planned first exports EU certification key to unlocking export potential LONDON (ICIS)– Ukrainian agribusiness “Hals Agro” plans to begin exporting biomethane to the EU and double its production output to 6mcm/year by the end of 2025. Speaking to ICIS Mariia Bielozerskykh, assistant to Hals Agro’s CEO Serhiy Kravchuk said that Ukraine’s gas transmission system served as a conduit for Russian gas flows to Europe, but “today that same infrastructure holds the potential to be repurposed for the delivery of domestically produced green gas to both Ukrainian and European markets.” BIOMETHANE PRODUCTION IN CHERNIHIV In December 2024, Hals Agro became the second Ukrainian company after Vitagro Group to inject biomethane of its own production to the Ukrainian gas transportation system and inject it into Ukrainian underground gas storage facilities. The company’s first plant in Chernihiv, launched in 2023, currently supplies around 3mcm of biomethane made from “manure, sugar beet pulp and corn silage” per year. A second plant, now under construction, in Kyiv, is projected to bring total output to 6mcm/year and “remains on schedule for commissioning by the end of this year, coinciding with our first exports of biomethane to the European Union,” the company confirmed to ICIS. Abundant feedstock supplies generated from cereal cultivation, sugar processing, dairy farming, and livestock allows Hals Agro to turn organic waste into renewable gas and digestate, which in turn returns to the soil as fertilizer. As such, biomethane presents the opportunity to “reduce dependence on imported fuels while fostering a truly circular economy.” SUPPLY SCALABILITY DEPENDS ON EU INTEGRATION Hals Agro’s planned production scale-up coincides with the initial wave of Ukrainian biomethane exports to the EU, as demand for renewable gases rises under the REPowerEU strategy. The company aims to begin exports to the EU by the end of 2025 but as Georgii Geletukha, head of the Bioenergy Association of Ukraine (UABIO) warned last week, further exports hinge on regulatory alignment and export certification. Namely integration into the EU’s Union Database (UDB) for renewable gases. “Certification through the Union Database will enable us to demonstrate the quality and sustainability of our product,” said Bielozerskykh, adding that a “robust and predictable market” must be developed to support Ukraine’s biomethane sector. To that end, “firm, long-term commitments from the EU concerning biomethane imports – together with streamlined certification procedures, cross-border trade mechanisms and reliable guarantees of origin,” are needed to “send a clear market signal and encourage investment,” according to Bielozerskykh. POST-WAR RECONSTRUCTION Ukraine faces a record 4–6bcm gas import need this year due to production losses and low reserves. With forward contracts showing no summer softening, domestic biomethane could emerge as a valuable, sustainable alternative over dependence on fossil fuel imports, especially if producers such as Hals Agro can scale up. Looking ahead to Ukrainian reconstruction, Bielozerskykh stressed that “decentralized energy solutions will be essential for rebuilding rural communities and ensuring a reliable energy supply in areas where centralized infrastructure has been damaged or destroyed” by Russian missile attacks. At the Danish-Ukrainian agro-technological business conference in April, Oleh Ryabov, head of renewable energy at Hals Agro, emphasized that expanding biomethane production could shift the focus in Ukraine away from grain exports to food and feed production, turning “traditional agrarian regions [into] energy-profitable centers of a modern energy and agro-industry.” ICIS has expanded its coverage of the emerging biomethane market via the development of the topic page “European biomethane: data, news and analysis”. Click here to access

LONDON (ICIS)–The ceasing of hostilities on both trade and war fronts are the focus of this month’s European PE and PP podcast, which assesses the impact of the US and China de-escalating their eye-watering tariffs battle for 90 days and of the India-Pakistan ceasefire. Senior editors Vicky Ellis and Ben Lake look at May’s price trends, how US-China trade relations are influencing sentiment in Europe, and are joined by senior editor Nadim Salamoun to discuss President Trump’s announcement regarding lifting sanctions on Syria, and how Pakistan’s market responded to its ceasefire with India. They also highlight ICIS coverage from the latest Asia Petrochemical Industry Conference (APIC) in Thailand, including how petrochemical demand may ramp up as US lifts Syrian sanctions, how South Korea is mulling petchem rationalization, and another ICIS podcast on Asian C2 players’ survival strategies. Podcast edited by Will Beacham

SINGAPORE (ICIS)–Japan’s overall chemical exports rose by 4.9% year on year to yen (Y) 1.05 trillion in April, even as automobiles and other imports to the US slipped amid US tariffs, official data showed on Wednesday. Exports of medical products, categorized broadly under the chemicals segment, rose by 13.2% year on year to Y119.1 billion, the Ministry of Finance (MOF) said in a statement. Overseas shipments of organic chemicals fell 3.0% year on year to Y177.8 billion in April, while exports of plastic materials rose by 4.9% to Y298 billion. By volume, shipments of plastic materials fell by 2.9% year on year to 451,274 tonnes. Japan’s total exports rose by 2% year on year to Y9.16 trillion in April, while imports slipped by 2.2% to Y9.27 trillion. This resulted in a trade deficit of Y115.8 billion. By destination, total exports to the US – the country’s largest export destination – fell by 1.8% year on year in April, while overall shipments to the Association of Southeast Asian Nations (ASEAN) were up by 1.9%. Japan’s overall exports to China declined by 0.6% year on year in April, and shipments to the EU fell by 5.2% year on year. Sweeping US tariffs, which include a 25% tariff on automobiles, steel and aluminium, and a further 10% baseline tariff rate on most countries, have spooked Japan, an automobile powerhouse. Japan also faces further 24% “reciprocal” tariffs beginning in July unless it can negotiate a trade deal with the US.

NEW YORK (ICIS)–Wells Fargo has downgraded US-based Westlake to ‘equal weight’ from ‘overweight’ on a weaker outlook for polyethylene (PE) and polyvinyl chloride (PVC). “We believe industry operating rates in North America for PE and PVC started Q2 2025 on a weaker note (low 80s) due to tariff uncertainty, making it difficult for Westlake to post quarter-on-quarter EBITDA (earnings before interest, tax, depreciation and amortization) growth in Q2 2025,” said analyst Michael Sison in a research note. “As a result, PVC and PE pricing fell in April versus March, with potential for further declines in May,” he added. The analyst slashed his 2025 earnings per share (EPS) estimate on Westlake to zero from a prior $2.60, and his 2026 forecast to $2.60 from a prior $4.90. For the upcoming Q2, he now sees a loss of $0.33 per share versus prior expectations of a profit of $0.95 per share. “We expect PVC prices will not see the usual seasonal acceleration during construction season given weakness in the housing market, though we anticipate a normal seasonal decline later this year,” said Sison. Shares of Westlake fell $3.22, or 4.1%, to $76.20 at the close of trading on 20 May 2025, hitting a new 52-week low. (Thumbnail shows pipe made out of PVC. Image by Shutterstock.)

LONDON (ICIS)–Relatively stable demand and evolving global supply dynamics are expected in European ammonia and acrylonitrile (ACN) markets in 2025. In this latest podcast, global ammonia editor Sylvia Traganida and Europe ACN editor Nazif Nazmul share the latest developments and expectations for what lies ahead. Ammonia players are expecting European demand from the nitrates market to pick up soon Availability is due to tighten with scheduled turnarounds in Saudi Arabia and Indonesia Ammonia prices globally are softening due to a lack of major demand Geopolitics-led macroeconomic challenges dampen prospects of ACN derivatives demand resurgence Balanced-to-long ACN supply dynamics anticipated to endure

Bundled product to be offered after usual capacity allocated on monthly basis If approved by regulators, this could benefit Ukraine and TSOs along the route Use of Trans-Balkan corridor in line with EU Russian gas phaseout roadmap LONDON (ICIS)–Gas transmission system operators (TSOs) along the Trans-Balkan route are looking to establish a single bundled transmission capacity product that would allow gas imported into Greece to be shipped to Ukraine at a uniform discounted tariff, according to a letter sent by the operators to national regulators and seen by ICIS. TSOs in Greece, Bulgaria, Romania, Moldova and Ukraine are proposing to offer a ‘route product’ which would connect several border points. This means that, rather than paying for capacity separately, companies would be able to book the full route at a single tariff. The route will be used for supplies to Ukraine only and will not allow companies to access domestic virtual trading points along the Trans-Balkan corridor for now. If approved, the product will be offered on a temporary basis between June–September 2025, but could be extended if it proves viable. The proposed Route 1 would involve the following interconnection points: Kulata/Sidirokastron (Greece-Bulgaria) Negru Voda/Kardam (Bulgaria-Romania) Isaccea/Orlovka, Kaushany, Grebenyky (Romania-Ukraine, Ukraine-Moldova, Moldova-Ukraine) LOWEST AVAILABLE CAPACITY Subject to regulators’ approval, the capacity offered at each interconnection point (IP) will be the lowest available firm capacity at any of the IPs along the route and will be matched in the other IPs. This principle will apply on the remaining available capacity after the usual capacity is allocated at rolling monthly auctions in line with EU rules. “This approach will ensure that the offered Route 1 product consists only of capacity which was not booked, [for which] market participants have not expressed their interest in booking it during the standard auctions and would otherwise remain unutilized. This solution will also reinforce the principles of sustainable competition and solidarity,” the grid operators said in the letter seen by ICIS. The proposed Route 1 product is planned to be offered on the Hungary-based Regional Booking Platform (RBP) on a monthly basis, on the 4th Monday of each month immediately preceding the month of delivery. To guarantee the completion of auctions on the same day, operators will apply a uniform price algorithm. DISCOUNTED TARIFF The capacity of Route 1 product will be offered at a reserve price equal to the sum of the reserve prices applicable for monthly capacity at the IPs for the respective month. The total sum of the tariffs charged by the Greek , Bulgaria, Romanian and Moldovan TSOs would be discounted by 25%. The Ukrainian gas grid operator, GTSOU, already applies a 46% short-haul tariff discount at the Isaccea and Kaushany border points with Romania and Moldova, providing the Grebenyky border point with Moldova is also used. More concretely,  it currently costs just over €10/MWh to export regasified gas from Greece’s Revithousa LNG terminal to Ukrainian storage. If the proposed Route 1 uniform tariff is approved, the total tariff from Greece up to the Romanian-Bulgarian border would be discounted by 25%. The remaining stretch from Isaccea to Grebenyky crossing Moldova would be discounted by 46% in line with existing tariff reductions offered by GTSOU. SUPPLY DIVERSIFICATION The EU has identified the Trans-Balkan corridor as one of the key transmission routes of gas to help central and eastern European countries to diversify away from Russian gas. For now, Route 1 would mostly benefit Ukraine as it seeks to secure over 5 billion cubic meters (bcm) of gas to build up stocks ahead of winter. However, operators along the corridor would also generate revenue as some of the capacity had been idle in recent years. Route 1 proposes the shipment of gas from Greece to Ukraine, but there have also been discussions to include delivery points from the Alexandroupolis LNG terminal once it returns from maintenance in August. This means that the Interconnector Greece Bulgaria (IGB) could also be added to the single product. A source close to discussions told ICIS operators are also considering an option for a shorter route linking Bulgaria to Moldova or Bulgaria to Ukraine. Nevertheless, Bulgaria is a transit route for Russian gas which means there is a risk that those volumes would end up in Ukrainian storage just as the EU is preparing to clamp down on spot imports from Russia.

SINGAPORE (ICIS)–Thailand’s GDP grew by 3.1% in the first quarter of 2025, but the southeast Asian country has slashed its GDP forecast amid looming US tariffs and uncertainty over a global trade war, official data showed on 19 May. 2025 GDP growth revised to 1.3-2.3% Trade surplus improves but domestic manufacturing remains weak Response to US tariff threat essential – NESDC Amid declines in spending across major categories, private consumption rose by 2.6%, down from 3.4% in the previous quarter, the National Economic and Social Development Council (NESDC) said in a statement. Exports by southeast Asia’s second-largest economy surged by 15.0% year on year to $80.4 billion in the first quarter, the strongest growth in 13 quarters, fueled by electronics and rubber. Imports rose 7.1% to $72.3 billion in the first quarter of 2025, driven by a rise in consumer goods and raw material imports. Manufacturing activity remained subdued despite a surge in merchandise exports, economists from Singapore-based UOB Global Markets & Research said. The robust export performance helped the trade surplus rise to $8.2 billion from the previous quarter’s $5.4 billion. “Growth was driven mainly by services and agriculture, while manufacturing remained weak,” UOB said. 2025 OUTLOOK In response to high household and corporate debt burdens, along with a global economic and trade slowdown, Thailand has revised its GDP growth forecast downward by 1.0% to within 1.3-2.3%, with a midpoint forecast of 1.8%. “Key supporting factors include the increased public investment expenditure, the continued expansion of private consumption amid low unemployment and inflation rates, and the continued recovery of the tourism sector and related services,” the NESDC said. Thailand still faces 36% “reciprocal” tariffs from the US, although these were suspended for 90 days back in April. Meanwhile, UOB maintains its 2025 GDP growth forecast at 2.0%. Thai authorities said priorities for the remainder of 2025 should include quickening budget disbursement; addressing trade protectionist policies through responsive measures; and safeguarding the manufacturing sector from unfair trade practices. It advised investigating dumping practices and “other unfair trade measures” used by major exporting countries. “Affected entrepreneurs should be supported in accessing procedures for initiating anti-dumping, countervailing duty, and safeguard investigations,” the NESDC said. Thailand will also offer larger tax incentives to small and medium-sized enterprises (SMEs) in a bid to mitigate US tariff threats, according to the Board of Investment on 19 May. Focus article by Jonathan Yee