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ICIS News

Canadian fertilizer producer Nutrien halts three Brazil fertilizer blending plants

HOUSTON (ICIS)–Canadian fertilizer major Nutrien has announced a decision to halt three fertilizer blending plants in Brazil as it undergoes a reorganization of their operations for improved efficiency within the country. The plants are in Alfenas, Minas Gerais and Morrinhos and Cristalina, Goias, and comes amid what the producer is describing as tougher market conditions with Nutrien saying it will continue to be able to meet the needs of their farmer customers. The current strategy is to continue to provide fertilizers via its other two blenders in Brazil and through their local partners and if necessary restart these three outlets. There are also plans advancing to shutter an older facility in the state of Sao Paulo. “Nutrien is committed to serving our farmer customers in Brazil with the solutions they need and fertilizer is an important component of our overall portfolio. At the same time, we are reviewing our operating model to find efficiencies and as a result we are assessing future options for our three blenders located in the cities of Alfenas, Morrinhos and Cristalina,” said Nutrien spokesperson. “The decision allows Nutrien to restart these assets in a short time period if needed. We are well positioned to serve our customer with the same technical quality, volume and breadth of the fertilizer portfolio, through strategic partnerships and other blenders that remain in operation.”

29-May-2024

German consumer confidence improves, but economic recovery ‘bumpy’

LONDON (ICIS)–Consumer confidence in Germany improved in May but the country’s economic recovery remains bumpy, with no significant GDP growth expected in Q2, according to the latest reports by research groups on Wednesday. Consumer confidence improves Industrial economy continues to struggle May core inflation flat at 3.0% year-on-year pace CONSUMER CONFIDENCE Although consumers remain pessimistic overall, confidence continued to pick up in May, Nuremberg-based market research firm GfK said. Income expectations rose in May, the inclination to save declined, and consumers' economic expectations improved compared with April, GfK said. Lower inflation rates combined with a noticeable increase in wages and salaries, were boosting consumers' purchasing power, the group said. Nevertheless, uncertainty among consumers remains “pronounced”, prompting them to delay larger purchases, the group said. The GfK consumer climate index for Germany rose from -27.3 points in April to -24.0 points in May, and GfK is currently forecasting that the index will improve further to -20.9 in June. A minus value indicates consumer pessimism. The GfK index is based on monthly interviews with about 2,000 consumers. The May interviews were conducted from 2-13 May. INFLATION Meanwhile, core inflation, as measured by the consumer price index (CPI), is expected at a 3.0% year-on-year pace in May, unchanged from April, according to an initial estimate by the country’s federal statistics agency on Wednesday. Core inflation excludes volatile energy and food prices. The headline CPI is estimated to gain 0.1% month on month in May and run at a 2.4% year-on-year pace (April: 2.2%). Analysts at German regional state bank NordLB said that inflation pressures remained "stubborn" in services. However, the latest inflation data out of Germany were no obstacle to an expected interest rate cut by the European Central Bank (ECB) next month, the analysts said. ECONOMY Economic research group DIW Berlin said on Wednesday that Germany’s economic recovery remained “bumpy”, with no significant acceleration of GDP growth expected in the second quarter. In the first quarter, GDP grew 0.2% from the 2023 fourth quarter. The main positive for Germany is that the global economy is “surprisingly robust”, despite high interest rates, continued high inflation, and geopolitical uncertainties, DIW said. A stronger global economy supports German exports. Domestically, higher wages and salaries, moderating inflation and expected interest rate cuts should translate into a slow increase of demand this year, DIW said. However, Germany’s industrial producers have yet to find a way out of the slump, although there were “signs” that a recovery in the industrial economy could get under way in the second half of the year, DIW said. The DIW economic barometer for Germany fell from 92.9 points in April to 86.1 in May – well below the neutral 100-point mark which indicates average economic growth. MANUFACTURING CLIMATE IMPROVES Meanwhile, another indicator, the ifo business climate index, remained unchanged at 89.3 points in May, Munich-based ifo reported. In manufacturing, the business climate improved for a third consecutive month as companies were considerably more satisfied with their current business and their outlook for the coming months was less pessimistic than in April, ifo said. The manufacturing order backlog, however, continued to decline, the group said. The ifo index is based on about 9,000 monthly survey responses from businesses in manufacturing, services, trade and construction. Germany chemical producers' trade group VCI expects the country's chemical production (excluding pharmaceuticals) to rise 5.0% in 2024, which would come after a 10.4% decline in 2023. Focus article by Stefan Baumgarten Please also visit Macroeconomics: Impact on Chemicals. Thumbnail photo of Germany's economic affairs minister and vice-chancellor Robert Habeck: source: German government

29-May-2024

VIDEO: 'ICIS Innovation Awards can boost your reputation' – 2023 winner

BARCELONA (ICIS)–Entering the ICIS Innovation Awards can raise your company's profile as a leader in this important area, according to the 2023 overall winner. In this video interview, ICIS Chemical Business deputy editor Will Beacham interviews David Dupont, Arkema’s vice president specialty polyamides. Arkema was the overall winner of the 2023 ICIS Innovation Awards. Click here to find out how to enter this year’s  ICIS Innovation Awards. Entry deadline Friday 7 June.

29-May-2024

Global chemical industry poised for M&A boost from Japan, India in 2024 – DC Advisory

NEW YORK (ICIS)–The global chemical sector should see increasing mergers and acquisitions (M&A) activity through the rest of 2024 following a depressed 2023, driven in part by portfolio restructuring among Japanese companies as well as increasing interest by Indian buyers, according to an investment bank. “In 2024, we are seeing increased levels of M&A activity as companies reevaluate their portfolios and seek strategic opportunities to drive growth, while navigating a constantly evolving landscape that is currently marked by technological advancements, shifting geopolitical alliances and an increasing emphasis on sustainability,” said investment bank DC Advisory in a report by managing director Federico Mennella and others. It expects the portfolio re-evaluation of Japanese chemical companies to accelerate and spur future M&A activity. China’s aggressive capacity expansion in commodity chemicals has greatly pressured Japanese companies exporting petrochemicals to China. Just under a third of Japan’s petrochemical output is exported, and China accounted for around half of exports in 2022, the investment bank pointed out. “Japanese production of ethylene has dropped to its lowest in 25 years due to China’s fast-growing capacity,” said DC Advisory. “As a result, Japanese diversified chemical companies such as Mitsubishi Chemical, Mitsui Chemicals and Resonac Holdings have recently announced strategies to restructure their petrochemical businesses, such as divesting, collaborating with other companies and to consider IPOs,” it added. Japanese chemical companies have also become more active on the buy side as they transition towards specialty, low-carbon and more sustainable business models. In April 2024, Japan-based Shin-Etsu Chemical announced its planned acquisition of Japan-based semiconductor materials company Mimasu Semiconductor Industry through a tender offer for shares. Shin-Etsu already had a 43.87% stake in Mimasu. In October 2023, Sumitomo Bakelite agreed to buy Asahi Kasei’s Pax packaging and films business serving the pharmaceutical, industrial and food sectors. DC Advisory advised Shin-Etsu and Sumitomo Bakelite on their respective transactions. Other recent deals involving Japan-based buyers include Sumitomo Corp/Saconix, DIC/PCAS Canada and Fujifilm/Entegris’ electronic chemicals business. INDIA AS A BUY-SIDE FORCEMeanwhile, India’s chemical industry has grown sales by over 6%/year on average since 2012 and is now further benefiting from global supply chain diversification, the investment bank pointed out. “We… believe the China Plus One Strategy, set up to minimize supply chain dependencies on China by diversifying the countries they source from, will drive growth in the Indian chemicals industry and prompt further M&A in the sector,” said DC Advisory. “With the Indian public markets recently valuing the specialty chemicals sector at a lifetime peak, we expect Indian companies in the sector will be eager to utilize available cash and if required raise further equity to do global acquisitions,” it added. The investment bank sees Indian buyers as consolidators for global assets in agrochemicals, active pharmaceutical ingredients (APIs), and specialty chemicals CDMO (contract development and manufacturing organization) segments. In November 2023, India-based carbon black producer PCBL Ltd announced the acquisition of India-based water treatment and oil and gas chemicals company Aquapharm Chemicals for $456 million. In June 2023, Bain Capital announced the acquisition of India-based Porus Labs, a producer of ag and specialty chemicals. “Large global funds such as CVC through its investment in Sajjan (2021) and Bain with its investment in Porus Labs, both leading Indian chemicals manufacturers, have created specialty chemicals platforms with an Indian company as the anchor asset from which they can acquire global businesses,” said DC Advisory. OTHER POSITIVE DRIVERSThe overall backdrop is also becoming more positive for chemical deal-making with increased earnings visibility in the sector for 2024; streamlining of portfolios toward growth subsectors; continued consolidation in sectors such as adhesives, coatings, pigments, ag chemicals and flavors and fragrances; and continued interest by private equity buyers, particularly in the sustainability aspect of chemicals, DC Advisory pointed out. The energy transition and the circular economy are also driving chemical sector growth and M&A activity. “We believe chemicals and materials companies that do not incorporate sustainability into their business models will not find buyers and may even struggle to survive, while those driving the change to a cleaner future will be in high demand from both private equity and strategic buyers,” said DC Advisory. Focus article by Joseph Chang

29-May-2024

INSIGHT: Surging freight rates hamper Asia petrochemical trades

SINGAPORE (ICIS)–A severe shortage of containers and vessel space as commercial ships take a much longer route to avoid the Red Sea has sent freight rates skyrocketing in recent weeks, artificially propping up petrochemical prices even as demand remained generally weak. Some sellers offer on free on board (FOB) basis but no takers Freight costs for Chinese exports more than double India may suffer near-term shortage of select petrochemicals Across markets in Asia in recent weeks, industry players’ lament boils down to this exasperated hyperbole: “The freight rates are killing us!” It takes the fun out of witnessing some initial signs of recovery in external demand for global manufacturing giant China. Whatever export competitiveness Asia gained from having weaker currencies against the US dollar is being undermined by the high cost of shipping out of the region. The Chinese yuan recently fell to a six-month low, while the Japanese yen continues to trade at multi-year lows against the US dollar, which is firmly supported by higher-for-longer interest rates. Overseas demand for Chinese products, including petrochemicals, seems to be improving, but actual trades are being hampered by logistics woes stemming from the Red Sea crisis in the Middle East. Attacks on commercial ships have continued in the key shipping lane that connects Asia to Europe, the latest being on an oil tanker bound for China. Rerouting of ships to the Cape of Good Hope meant longer voyage times and much slower turnover of vessels and containers, thereby, creating a strong pressure on freight rates, which may persist for most of the year. “The race for capacity appears to have started, with shippers showing strong demand due to shippers moving significant cargo in the first four months of 2024 to avoid potential Q3 constraints​​,” Richard Fattal, chief commercial officer of London-based freight forwarder Zencargo said in a note on 20 May. “Combined with an average of 5% ongoing blanked sailings, there is a looming future of tighter capacity, higher rates and sellers’ market swings ahead,” he said. “With capacity shrinking in the face of resurgent port congestion, driven by equipment shortages in China and longer routes around the Cape of Good Hope,” Fattal said. For Q2, Zencargo is projecting more than a 13% contraction shipping capacity on the Asia-Europe routes compared with Q3 2023, “with alliances cancelling 5% of sailings between weeks 20 and 24 [H2 May to H1 June]”. “The effective capacity to Northern Europe, based on actual vessel departures from Asia, has decreased by 5.1% compared to a year ago,” it said, citing “the longer route taken by the majority of vessels via the Cape of Good Hope, despite a 17.8% increase in vessel capacity on the Asia-North Europe route”. For the Asia-Mediterranean route, however, the overall capacity has “increased by 10.5%, even with the diversions via the Cape” due to a 49.1% increase in total deployed capacity on this route compared to a year ago”, Zencargo said. WEST BUILDING WALLS AGAINST CHINA TRADES The July-September period is the peak season for Chinese shipments to the west, ahead of the Christmas season in December, according to Wang Guowen, director at Shenzen Logistics and Supply Chain Management Research. Possibly driving up US’ overall demand for Chinese goods, which exerts upward pressure on shipping costs, is the impending tariff hike on imports of selected products from China, including electric vehicles (EVs) and battery materials. For Chinese EVs, the US import tariffs would quadruple to 100% from 1 August, which is tantamount to a ban. European countries appear to be considering similar protectionist measures against China, whose overcapacity is deemed to be killing domestic industries in the west. “Western countries' implementation of tariffs and tax structures on Chinese-manufactured automotive and EV exports is anticipated to significantly impact the shipping sector by potentially reducing vessel demand,” online container and leasing platform Container xChange said in a recent note. To bypass these trade barriers, Chinese automotive and EV makers “are accelerating efforts to internationalize their manufacturing, assembly, and distribution processes”, it said, adding that “immediate effects are already evident, as manufacturers are hastening to ship EVs to avoid impending tariffs and uncertainties”. In the global petrochemical scene, manufacturing facilities in the US and Europe, as well as in parts of northeast Asia are shutting down amid China’s overcapacity. Technically, reduced production elsewhere would open up new markets for China’s excess capacity, if not for the surging freight rates, which further deter trades while demand recovery remains fragile. China’s overall exports have remained soft, posting low single-digit annualised growths in three of the first four months of 2024, with one month in contraction. HEADACHE FOR INDIA PETROCHEMICAL IMPORTERS Petrochemical end-users in India are facing long waiting time to get their hands on imports from China. “Now, no shipping lines will confirm fresh Q2 shipment booking, even after dishing out quotes that are three to four times higher than Q1,” an India-based styrene butadiene rubber (SBR) importer said. A phenol trader said: “June vessel arrangements are more troublesome this year because of the Red Sea issues and also China's exports have been weak especially in the past two months, so fewer vessels are being arranged to China.” India is possibly facing a near-term shortage of purified terephthalic acid (PTA), since northeast/southeast Asian suppliers are struggling to export to the south Asian market. Freight rates from both Taiwan and Thailand to India nearly doubled from April, with voyage time for some shipments taking as long as 90 days, up from the usual 30-40 days. For polyethylene (PE) and polypropylene (PP), cargoes from the Middle East heading to the south Asian markets of India and Pakistan are also being delayed, amid congestion at the ports of Salalah in Oman, Dammam in Saudi Arabia and Jebel Ali in the UAE. For polymeric methylene diphenyl diisocyanate (PMDI) of northeast Asian origin, offers to India have spiked amid tightened regional supply, with delays in getting cargoes from South Korea. SURGING SHIPPING COSTS KILLING SPOT TRADESSpot petrochemical trades are being stalled by constantly changing freight rates on a weekly basis. In the polypropylene (PP) market, some Chinese suppliers have stopped offering on a cost, insurance and freight (CIF) basis, and will only offer on FOB basis because of the risks. For the China-to-Vietnam and the Vietnam-to-Indonesia routes, freight rates have nearly tripled, market players said. Buyers are less willing to discuss on an FOB basis, unwilling to shoulder an expected high cost since most of them do not have their own regular shipper. For soda ash, offers of Turkey-origin dense grade cargoes for 1,000-tonne lots to southeast Asia for Q3 shipments rose to around $300/tonne CFR, up by $20-30/tonne compared with May shipments. Importers of the material across Asia were largely staying on the side lines, with some of them experiencing delays in receiving Turkish cargoes. “Discussion levels are firming up due to freight costs,” said an end-user, adding that the “Red Sea issue is getting worse and lots of shipments from Europe and USA are stuck.” The same is true for the southeast Asian PE market given delays in arrivals of Middle East-origin cargoes and amid perceptions of shorter supply. In the oxo-alcohols markets, producers in Asia are under strong pressure to offload cargoes at lower prices given difficulty in moving volumes to their usual export outlets. Freight rates on chemical tankers are also on the rise amid the Red Sea crisis, sources from Asia’s monoethylene glycol market, resulting in postponing of cargo-loading by some producers. “The freight rates are quite high now, and we have to optimize our vessel availability,” a major MEG producer said. FURTHER FREIGHT SPIKES LIKELY IN JUNE H2 is typically “a busier, more competitive, and profitable season for the shipping industry”, with many container sellers are “currently holding onto their inventory” in anticipation of better demand, said Christian Roeloffs, co-founder and CEO of Container xChange, in a note in May. "In an environment of heightened market volatility and encouraging demand recovery for global trade, container traders are gearing up for the second half of 2024, where we expect a cyclical rise in demand,” he said. “This combination of heavier-than-expected demand for freight and anticipation of further demand surges in the second half of 2024 is driving up container trading prices in China,” Roeloffs added. In a recently conducted survey of container traders and leasing companies by Container xChange, it noted that a majority of the respondents reported “extremely high prices for 40 ft high cube containers in China”. On 21 May, the average one-way leasing rates quoted in the market rose to as high as $2,480 for 40 HC in China for US-bound shipments, more than double the rate at the start of the month at around $950, it said. With ceasefire between Israel and Palestinian militant Hamas in Gaza proving elusive and the threat of a wider Middle East conflict still hanging, it looks like high freight rates are here to stay for an extended period. Insight article by Pearl Bantillo With contributions from Nurluqman Suratman, Fanny Zhang, Nadim Salamoun, Judith Wang, Helen Lee, Ai Teng Lim, Samuel Wong, Julia Tan, Izham Ahmad, Jackie Wong, Shannen Ng, Helen Yan and Clive Ong

29-May-2024

APIC '24: PODCAST: India inventories, China downstream weakness weigh on acetic acid demand

SINGAPORE (ICIS)–ICIS editors Hwee Hwee Tan and Jady Ma discuss current trends in Asia's acetic acid market. China demand softens on difficulty in passing on high costs to downstream users India inventory at multi-month high since end-2023 South Korea plant restart dents northeast Asia spot demand (This podcast first ran on 24 May.) Visit ICIS during APIC ’24 on 30-31 May at Booth 13, Grand Ballroom Foyer of the Grand InterContinental Seoul Parnas in South Korea. Book a meeting with ICIS here.

29-May-2024

APIC '24: Policy fragmentation stalls Asia's plastics circularity drive

SEOUL (ICIS)–Asia's journey towards a circular plastic economy is gaining momentum, but the region's diverse waste management practices and fragmented regulations present challenges to realizing this vision. Harmonizing policies crucial for circularity Demand for recyclates driven by regulations Regional disparities impact global sustainability With a steady rise of plastic consumption in Asia, countries in the region have taken steps to promote the circular economy, including implementation of the Extended Producer Responsibility (EPR) policy, waste separation requirements and bans of single-use plastics, said Bala Ramani, director of sustainability consulting and Asia strategy advisor at ICIS. EPR shifts the financial and/or operational burden of post-consumer product management from governments to producers. Japan, South Korea, Taiwan, India, the Philippines, and Singapore have adopted the policy. However, the scope and depth of circularity strategies, which require legislation, currently vary widely across Asian countries because the region does not have an overarching administrative body like the EU in Europe to unify countries around sustainability goals. “As the economic and supply chain integration amongst the countries in Asia deepens, there is also a need for regional integration of circular economy policies," Ramani said. Plastic circularity will be a core topic of the Asia Petrochemical Industry Conference (APIC) in Seoul, South Korea on 30-31 May, whose theme is "Trailblazing the path in a sustainable era." REGIONAL DISPARITY While Japan, Taiwan and South Korea have been at the forefront of efficient waste resource management, countries in south and southeast Asia are still working toward setting up a well-managed waste management and recycling infrastructure, Ramani noted. While the “informal sector” plays a significant role in solid waste management in southeast Asia and parts of the Indian subcontinent, northeast Asian countries have established robust systems, reducing their need for such informal contributions, according to ICIS Asia Pacific plastic recycling analyst Joshua Tan. Nine out of the top 20 countries globally with the highest percentages of mismanaged plastic waste are in Asia, Tan noted, and this is particularly evident in coastal populations residing within 50 kilometres of the coast. The same nine countries are identified as major contributors to marine plastics pollution through rivers. Tan said that these countries generate some 844,000 tonnes of plastic waste annually, which is more than 20 times the capacity of a typical recycled polyethylene terephthalate (R-PET) recycling plant. "For Asia to achieve plastic circularity as a region, it will be imperative for the countries to harmonize policies, develop regional standards (design for recycling, industrial standards for recyclates, mandatory recycled content, trade restrictions etc) and facilitate regional cooperation," Ramani said. CIRCULAR PLASTICS OFFER COMPETITIVE ADVANTAGE   Plastics are essential to sustainability across various sectors, from packaging and automotive to agriculture and construction, making effective plastic waste management and recycling crucial for their future viability, Ramani said. “As the chemical sector goes through this period of demand uncertainty and overcapacity especially for fossil-derived products such as virgin plastics, plastic recycling and circularity offers a means of competitive advantage and higher value-addition in the future to ultimately distinguish winners from losers." While mechanical recycling is expected to play a significant role in addressing plastic waste in the region, chemical recycling will be necessary to complement these efforts, particularly due to the diverse waste management systems across different countries in the region, Ramani said. Mechanical recycling dominates the Asia-Pacific market with more than 18 million tonnes/year of installed capacity, dwarfing chemical recycling's nascent 700,000 tonne/year capacity, according to Tan. And while plastic recyclates have become a global commodity, their trade is marked by a stark contrast with virgin plastic material, Ramani said, noting that while demand for recyclates is driven by regulations and brand commitments in certain regions, supply of consistent, high-quality material struggles to keep pace. Recyclates are secondary raw materials derived from either post-consumer household waste (PCR) or post-industrial waste (PIR), with PIR being easier to recycle due to less contamination. "This results in regional imbalances across the value chain from plastic waste collection and sorting to recovery/recycling and ultimately the end-use of recyclates, leading to supply-demand imbalances with prices ultimately driving movement of materials from one region to another.” These regional disparities in the plastics recycling value chain have not gone unnoticed, with significant implications for global sustainability efforts. In response to this challenge, Europe's Antwerp Declaration, launched in February this year, sets ambitious goals for the chemical industry to adapt to rapid expansion of renewable energy, strengthen local supply chains, and shift towards sustainable products. The declaration – now signed by close to 1,200 organizations across 25 sectors – calls for urgent action from European governments to boost industry competitiveness and sustainability, requiring a massive increase in electricity production and a sixfold increase in industrial investments to achieve climate neutrality by 2050. "The recent launch of the Antwerp Declaration by the European chemicals and other industries is a further sign of the more local-for-local world we are moving towards," said ICIS senior consultant John Richardson. “Local-for-local” supply chains involve chemicals as they are the building blocks for all the manufacturing and service supply chains, he noted. "Europe must prioritize new renewable energy projects and make it easy to install the necessary infrastructure… ‘Local-for-local’ domestic supply chains are critical for [supply] security," Richardson said. "Governments need to lead in boosting demand for low carbon and circular products as Europe needs a strong single market for bio feedstocks, plastic waste, recycled materials and electricity," he added. Focus article by Nurluqman Suratman Click here to view the ICIS Recycled Plastics Focus topic page. Thumbnail image: Plastic bottles made from polyethylene terephthalate (PET) are widely used for soft drinks and bottled water. PET can be fully recycled. (Source: Helmut Meyer Zur Capellen/imageBROKER/Shutterstock)

29-May-2024

APIC '24: PODCAST: China PP exports to weigh on SE Asia on ample C3 supply

SINGAPORE (ICIS)–Ample propylene (C3) supply in Asia and new downstream polypropylene (PP) capacities in China are expected to weigh on discussions in southeast Asia over the coming months. Asia C3 to lengthen after propane dehydrogenation (PDH) units restart in China; SE Asia volumes China PP exports to weigh on SE Asia discussions Asia PP prices to come under pressure in June-July In this podcast, ICIS editors Julia Tan, Jackie Wong and Lucy Shuai discuss current trends in Asia's propylene and PP markets, and what we can expect going forward. (This podcast first ran on 16 May.) Visit us at Booth 13, Grand Ballroom Foyer of the Grand InterContinental Seoul Parnas in South Korea. Book a meeting with ICIS here.

29-May-2024

APIC '24: PODCAST: NE Asia C2 in oversupply; SE Asia prices under pressure

SINGAPORE (ICIS)–Northeast Asia remained in oversupply of ethylene (C2), and downstream margins remained weak. Capacity growth in China is expected to slow down, while in southeast Asia, the market is likely to remain under pressure in H2 2024. NE Asia players on lookout for H2 arrivals Margins at stand-alone derivative units remain weak Weak NE Asia prices, open US arbitrage window weigh on SE Asia; downstream demand tepid In this podcast, ICIS markets editor Josh Quah and analysts Amy Yu and Shariene Goh discuss trends in the Asian ethylene market and what we can expect in the near future. Visit us at Booth 13, Grand Ballroom Foyer at the Grand InterContinental Seoul Parnas in South Korea. Book a meeting with ICIS here.

29-May-2024

PODCAST: Soda ash markets adapts to a competitive landscape amid a tumultuous US-China relationship and uneven demand trends

LONDON ICIS (ICIS)–The soda ash market narrative reminds one of Dickens' A tale of two cities: "It was the best of times, it was the worst of times […]we had everything before us, we had nothing before us." From the vertiginous highs of the post-pandemic boom to the slumbers brought in by high borrowing costs, soda ash players are navigating rougher seas with lows elongated compared to typical cyclical troughs and highs that had exhausted anyone involved in selling the molecule for over two years. Likewise, the promises of a boom in consumption via the lithium carbonate to support lithium-ion battery-run electric vehicles is also tempered by the idea that global oversupply could through the molecule back into the depressed mode and low margin era it has known for decades. Demand from the all-important flat glass applications servicing the construction and auto industries have stabilized after a year-long slow decline and is likely to remain slower in H2. Regionalism is at all-time highs, and supply from China is once again in the line of fire. ICIS soda ash editors Anne-Sophie Briant-Vaghela from Europe, Helen Lee from Asia, and Bill Bowen from the US talk about the changing market conditions as China switches from net exporter to net importer in Q1-Q2. Edited by Meeta Ramnani

28-May-2024

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