Chemicals

COLORADO SPRINGS, Colorado (ICIS)–Employment in the US chemical industry will continue growing even while it contends with a wave of retirements, the consultancy Deloitte said. CHEM EMPLOYEES NEEDED FOR GROWING INDUSTRYThe chemical industry grows at a multiple of GDP. As the global economy grows, so will the chemical industry, and that will require companies to hire employees, said Bob Kumpf, managing director at Deloitte. "Society expects us to innovate, whether it's emerging technologies, whether it's biotechnology, whether it's all the downstream applications," Kumpf said. "This is a growth sector." Kumpf and others at Deloitte discussed a recent employment study by the consultancy during the annual meeting of the American Chemistry Council (ACC). Even if the nature of growth in the chemical industry is changing, it is not stopping, he said. "There is no peak materials in any views that we have." While new technologies like AI and remote work are changing how people do their jobs, those technologies are not eliminating the need for labor. The following chart summarizes Deloitte's forecasts for US employment trends in the oil and gas (O&G) industry as well as in the chemicals industry. Chemical companies will have to manage that growth in employment amid a wave of retirements. Deloitte expects that 20% of the current workforce will retire by 2030, said Kate Hardin, executive director at Deloitte. Deloitte broke down management strategies into four pillars consisting of talent ownership, composition, capability and mobility. TALENT OWNERSHIPChemical companies are relying on third-parties to manage digital upgrades and information technology services, while maintaining nearly 88% of its workforce as internal. COMPOSITIONThe study shows that chemical employment will rise in the following sectors: Site and plant workers Specialists and technicians Business support Customer engagement Leadership Among site and plant workers in the energy and chemicals industry, Deloitte expects rising global demand, regulatory changes and infrastructure will contribute to rising demand for these employees. For specialists and technicians, growth drivers are occupational health and safety, industrial engineers and material engineers. The study forecasts declines in chemical engineers. In the past, those chemical engineers had left for jobs in the pharmaceutical and biotechnology sectors, Hardin said. More recently, they are going into software development. For business support, employment growth will center around computer occupations, computer network architecture and training and development specialties. Overall, automation, outsourcing and AI will reduce employment for some job types. CAPABILITYDeloitte expects generative and agentic AI to make employees more productive. The consultancy broke down AI's effects on employment into human-in-the-loop tasks, human-enabled tasks and human-exclusive tasks. For energy and chemical workhours as a whole, about one-third are expected to be human-in-the-loop tasks, in which machines and agentic AI lead the effort. Another third will be human enabled, under which humans augment digital technologies. The rest will be human exclusive, which covers tasks only people can do. For some of these human-exclusive tasks, there could be prolonged vacancies, especially for occupations such as mechanics, repairers and vehicle operators, according to the study. These jobs have high turnover, and chemical companies will compete with construction and other industrial sectors for these workers. MOBILITYDigitization is making more skills common among industries and sectors, giving employees and employers a wider pool from which to choose. Some chemical jobs can be remote, but a robust on-site workforce remains essential for running chemical plants. WORKFORCE AMONG FEW TOOLS CHEMS HAVE IN CHALLENGING ENVIRONMENTOnce more, chemical companies expect 2025 to be another challenging year in which they will need to look internally to increase revenue and profits. The overall economy will provide little – if any – help. At the same time, trade policy is changing and conflicts among nations are growing, all of which is making it difficult to plan and forecast demand. Workforce is one of the few areas chemical companies can control, and technology changes in AI and robotics are giving companies more options to reduce labor costs and increase productivity. The ACC Annual Meeting ended on 4 June.

19-Jun-2025

SAO PAULO (ICIS)–Grupo Almatia continues seeking expansions outside its Colombian domestic market as the medium-term economic prospects and the government’s fiscal policy cast a shadow, according to the CFO at the chemicals distributor, formerly known as Quimico Plasticos. Jose Andres Toro added his voice to the many which, in the past week, have showed great concern about Colombia’s government decision to exercise an “escape” clause which allows for the so-called fiscal rule to be lifted in extraordinary circumstances. In a pre-election year and with the public finances offering little margin for the left-leaning government of Gustavo Petro to fulfill its promises to expand the welfare state, the cabinet has now decided to exercise a rule which is meant to be used in public emergencies or calamities. Chemicals sources and industrial groups have said companies' borrowing costs could rise sharply if those costs for Colombia’s sovereign also rise, as expected, while the trade group representing plastics, Acoplastics, said in an interview with ICIS the fiscal issues were coming to add issues to an industry already under pressure due to China’s competition. But Almatia’s CFO described frustration with government spending increases because, in theory, they should have improved public services but, he said, that the spending programs have been unable to deliver tangible benefits to citizens. "It's already proven it's not making social investments. It's not doing anything with that money; instead, what it's doing is creating bureaucracy, creating jobs in the public sector,” said Toro. “In the province where we are based, Antioquia, the situation has become particularly acute. National projects with state funding have been abandoned by the government and we Antioquians reached into our pockets and are financing the projects ourselves, with our own resources, through the provincial government.” Beyond fiscal concerns, the company faces challenges from inflation and dramatically rising transportation costs affecting grassroots workers, said Toro, highlighting how gasoline subsidy removals have pushed fuel prices up by approximately 50%, far outpacing general inflation rates of 5-7%. "Transportation costs have risen much more than the average inflation rate because the government began to remove a subsidy that gasoline used to have. For someone who travels every day on the subway or the bus, those costs are multiplied," he said. “With domestic growth stagnating at 2-3% annually, while inflation runs at around 5%, real economic performance is declining. In real terms, we're not growing. We're stagnant," he said. Toro said a good example of Colombia’s issues would be the construction sector, where the downturn has proved especially acute, casting a shadow to the rest of the economy given that real estate is a sector of sectors, with many associated industries depending on it, not least the many plastics which Almatia sells to be used in multiple applications going into construction. Facing domestic market challenges, Grupo Almatia is slowly but decisively pursuing expansions across Latin American countries, said Toro. For now, the company has set up operations in markets close to Colombia because the majority of its facilities are there, and from them it delivers to other markets such as Ecuador, Peru, Guatemala and the Dominican Republic. CHINA COMPETITION: GOOD OR BAD?The executive detailed how Chinese suppliers have become increasingly competitive across chemical markets, though not to the exclusion of other international competitors, and conceded many of Almatia’s materials come from that country. China has been under fire for some time due to its “dumping” – selling industrial products at below production costs in overseas markets, just to dump excess products China does not need, which has hit producers hard in other, non-state-controlled economies which cannot compete with China's heavily subsidized companies. "We've been working with several suppliers for several years, and they compete here like any other, like the Koreans, the Americans, the Arabs. For instance, in TiO2 [titanium dioxide], Chinese pricing remains competitive against Western suppliers without creating insurmountable advantages [for the Chinese],” said Toro. "Chinese prices are competitive compared to those coming from outside the West, but they're not so markedly different that those from the West can't compete. We import from 20 countries, and obviously prioritize the most competitive supply sources.” All in all, Toro conceded there are concerning price dynamics taking place currently in the petrochemicals industry, dynamics which could end up hitting all sides of the market if not corrected. “In PP [polypropylene] markets, for instance, monomer prices around $750-770/tonne should theoretically support resin prices near $980-990/tonne in regional markets,” said Toro. “However, freight and production costs don't support these economics, suggesting either advantageous raw material sourcing or unsustainable pricing. And this pricing pressure affects non-integrated PP producers globally.” This interview took place on 16 June. Front page picture: A warehouse operated by Grupo Almatia in Antioquia, Colombia  Picture source: Grupo Almatia  Interview article by Jonathan Lopez

19-Jun-2025

LONDON (ICIS)–Renewable methyl 9-decenoate (9-DAME), to be produced at Verbio’s upcoming ethenolysis plant in Germany, could be an opportunity for the oleochemicals industry, a Verbio executive told ICIS. With 9-DAME, the industry could access palm-free C10 derivatives in consumer products that are typically derived from palm kernel oil (PKO), Marc Siegel, Verbio’s head of sales, Specialty Chemicals and Catalysts, said in an interview. “9-DAME chemicals could offer alternatives for an important fraction in the oleochem industry,” he added. Verbio’s plant at the Bitterfeld chemical site in Germany’s Saxony-Anhalt state is expected to start up in 2026, using rapeseed oil methyl ester as feedstock, It will have capacities for 32,000 tonnes/year of methyl 9-decenoate (9-DAME), and for 17,000 tonnes/year of 1-decene. 9-DAME is a valuable platform molecule enabling a multitude of products, Siegel said. It will enable customers to produce C10 fatty acids or alcohols, allowing them to make their own C10 derivatives with high purity, he said. As such, Verbio’s production capacity of 32,000 tonnes/year of 9-DAME could replace PKO and “represents significant potential in the oleochemicals industry for the C10 value chain”, he said. PKO, for its part, is controversial because of the environmental impacts of palm oil plantations, Siegel said. Furthermore, the availability of PKO is limited globally at about 6.2 million tonnes/year, and its C10 content is only about 3-3.5%, he said. By using 9-DAME to make C10 fatty acids or alcohols, customers would avoid the complex supply chains of PKO from Asia, with its price fluctuations. They would also reduce their carbon footprint, and they could put palm-free and GMO-free labels on their shampoos and other products, he said. Siegel added that coconut oil is another source of C10 derivatives. However, coconut oil is typically more expensive than PKO, and its global production volumes are lower, he said. Asked about 9-DAME pricing, Siegel said: “We feel to have a solid position in the market with attractive pricing” and "strong unique selling propositions”, including palm-free claims and regional European sourcing. As Verbio’s project is nearing completion, the environment for renewable chemicals and recycling has become challenging in North America whereas in Europe “there are many positive examples” of new projects for bio-based chemicals, supported by the European Green Deal and other regulations, Siegel said. “Verbio remains positive about increasing demand [for renewable chemicals] in Europe and other regions,” he said. “Many European projects continue to thrive”, he added. In North America, however, the situation is “less dynamic”, with some companies scaling back operations (Origin Materials in Canada) or facing funding losses (Eastman in Texas), Siegel noted. Verbio's ethenolysis plant under construction at Bitterfeld, Germany; Source: Verbio

19-Jun-2025

SINGAPORE (ICIS)–Bank Indonesia (BI) maintained its key interest rate – the seven-day reverse repurchase rate – steady at 5.50% on 18 June, pausing its monetary easing stance as it prioritizes currency stability. The central bank also left overnight deposit and lending rates unchanged at 4.75% and 6.25%, respectively, citing global economic conditions and rupiah (Rp) safeguarding. Firm interest rates lend support to currencies. Nonetheless, Indonesia’s central bank hinted at rate cuts later this year to boost economic growth amid tariff uncertainties and geopolitical tensions. Indonesia is southeast Asia's biggest economy and is a major importer of petrochemicals amid strong demand and limited local production. The country is expected to post a GDP growth of 4.6-5.4% this year, according to BI’s forecasts. "At home, economic growth in Indonesia must be strengthened constantly against a backdrop of global uncertainty caused by US tariff policy and geopolitical tensions," the central bank stated. "Economic activity in the second quarter of 2025 indicated improvements in terms of non-oil and gas export performance due to the frontloading of exports bound for the US as an anticipatory response by exporters to US tariff policy," it added. Household consumption and investment must be strengthened as sources of economic growth, the central bank said. “We believe the macro environment remains well-positioned for BI to cut rates later this year to support economic growth, following a slowdown in first quarter GDP to 4.9% year-on-year, down from 5.0% in the previous quarter,” Dutch banking and financial service firm ING said in a research note. “The deceleration was primarily driven by weaker investment activity, reflecting heightened uncertainty surrounding tariff policies,” it said. The government’s $1.5 billion worth stimulus may help stabilize consumption in the near term but is unlikely to spur a meaningful recovery in capital expenditure, ING noted. “Looking ahead, while the sustainability of large inflows into Indonesian bonds remains uncertain due to persistent fiscal risks, the broader USD ($) weakening trend should offer support,” it said. “In this context, BI may use windows of currency strength to cut rates more opportunistically,” ING said. ($1 = Rs16,382) Additional reporting by Pearl Bantillo Visit the ICIS Topic Page: US tariffs, policy – impact on chemicals and energy.

19-Jun-2025

SAO PAULO (ICIS)–The global petrochemicals downturn could potentially stretch to 2028, but the years-long crisis due to overcapacities may leave a lasting mark – lower for longer margins, according to a chemicals analyst at credit rating agency Fitch. Marcelo Pappiani, Fitch’s main analyst for Brazil’s petrochemicals, said that potentially lower spreads post-crisis, compared to the averages prior to the current downturn, could have deep financial implications for petrochemicals companies and their ability to borrow and/or invest. The analyst reminded how he started covering Brazil’s chemicals for Fitch in 2022 – at the time, the nascent downturn was expected to be a traditional downcycle lasting around two years, three at most. In an interview with ICIS in 2023, the analyst said the downturn could last to 2025. In another interview in 2024, he did not want to put an end date to what was already looking like a half-decade-long crisis, and warned that despite protectionist measures in Brazil, chemicals producers were far from being out of the woods. MARGINS LONG TERMFast forwarding to current times, Fitch is forecasting the downturn to last until 2028 as China’s relentless start-up of new capacities, while not having the domestic demand for them, will continue putting Chinese products in all corners of the world at very competitive prices. “We now expect the downcycle to last a bit longer, probably until 2028, because we are still seeing and probably will continue to see for a while some prices at the bottom. I have heard some industry players put the end to the downturn in 2030 – we will need to see, but indeed the end date for it has had to be pushed back several times already,” said Pappiani. “This is the most prolonged downcycle most companies have been through. And what we are trying to figure out here is, upon recovery, when spreads return to mid-cycle, are they going to be at the same level they were before?” The analyst went on to explain his theory by looking at a key financial metric in a company’s performance: the ratio earnings/debt. The higher the ratio, the more effort a company needs to focus on deleveraging; therefore, capital expenditure (capex) and other long-term productivity measures can suffer. “Post-crisis, are companies expecting to have the same levels of earnings and leverage than they were running before this turmoil? This is the million-dollar question. Those metrics will eventually recover from the current crisis-hit numbers, but I doubt it will be at the same levels as before. Some companies still think the market will recover to where it was: I don't seem to agree much, but let's see.” HOW TO DEAL WITH CHINAThe current downturn, closely linked to China’s state-driven economic policies, presents companies from market economies with many challenges they have not been able to overcome yet. The situation which has brought the petrochemicals industry to its knees is clear. China's state-supported companies are just producing for the sake of employment and social stability – so the system does not feel threatened – over profitability, which is what drives competitors in most other countries.  "The market is always saying about how companies need to rationalize – shut down plants that are not profitable and the likes. But what's rational for us here in the West might not be rational for people in China, where they are more concerned about employment, for instance,” said Pappiani. "But the point is that the amount of rationalization we have already seen hasn't been enough to compensate for this oversupply. Meanwhile, domestically, the Chinese government doesn't seem to be concerned too concerned today about that [high levels of indebtedness and the burden that will put on future generations of Chinese citizens].” Pappiani went on to say that long term, the petrochemicals sector will eventually balance out simply because the world’s growing population will continue devouring plastics and petrochemicals-derived materials. “Despite the current overcapacity challenges, plastics and chemical products will remain fundamental to the global economy. Together with ammonia for agriculture, cement for construction, and crude oil, plastic resins rank among the world's most critical materials,” said the Fitch analyst. “This structural dependency on plastic materials continues growing and seems set to continue doing so, despite sustainability concerns and as environmental considerations gain prominence." Front page picture source: Fitch Interview article by Jonathan Lopez

18-Jun-2025

Spoof signals hits vessel tracking around Hormuz Implications for ship safety and market analysis Impacting vessel scheduling to Ras Laffan but not production LONDON (ICIS)—Much focus from energy companies tracking hostilities between Israel and Iran has been on higher oil, gas and LNG prices but compromises to critical regional shipping data pose risks both to safety and wider data analysis. The corruption of the automated ship signal (AIS) data that vessels broadcast to alert others of their whereabouts has emerged in recent days, especially in and around the Straits of Hormuz, the narrow channel between Iran and Oman. On Monday 16 June, after a weekend of rocket fire between Iran and Israel, AIS data gathered by ICIS LNG Edge showed significant disruptions coming from several ships close to Ras Laffan, Qatar, in the Persian Gulf. In the case of LNG tankers, this manifested itself in ‘spoofed’ signals erroneously indicating that several vessels were located on the Iranian mainland. This was corroborated by the United Kingdom Maritime Trade Operations (UKMTO), a shipping organisation that runs a Voluntary Reporting Scheme for the sector for the Red Sea, Gulf of Aden, and Arabian Sea. “The level of electronic interference … inside the Gulf [is] having a significant impact on vessels’ positional reporting through automated systems. Vessels are advised to transit with caution and continue to report incidents of electronic interference,” the UKMTO said on 16 June. It has been reporting about GPS interference in the region since early May. AIS INTERVENTIONS Faced with these issues, ICIS LNG analysts have been carefully unpicking the satellite trails produced by spoofed LNG shipping to try to work out where they actually are. At the same time as UKMTO was issuing its warning, around six LNG vessels were broadcasting erroneous locations inside the Iranian mainland, at Asaluyeh, more or less opposite Bahrain on the other side of the Persian Gulf. These included Aseem, chartered by India’s Petronet; Rasheeda, Al Jasra, Simaisma and Maran Gas Troy – all of which are under Qatari control – and Italian Eni’s Maran Gas Efessos. Once identified, it is possible to manually delete the erroneous waypoints and reposition the vessel back where it was last reliably seen. However, given that each time the vessel broadcasts a new point it can place it back in Iran, ICIS has been generally been carrying out removals only once a vessel is clearly back on the move, as in the case of Maran Gas Troy, a laden vessel which was clearly rounding Hormuz in the evening of 17 June. MAJOR SAFETY IMPLICATIONS Together with marine radar, the AIS signature that ships broadcast to satellites is a key tool in collision avoidance for water traffic. On 17 June, however, a collision was reported between two vessels 26 nautical miles northeast of Fujairah. Footage later showed one of the vessels, an oil tanker, having sustained severe damage and burning strongly. There was “no indication the incident was the result of hostile activity resulting from the ongoing regional conflict,” UKMTO added, but the fact that the collision was caused by vessels sailing blind, rather than being hit by a missile is unlikely to calm the market significantly. This was in evidence in the rollcall of around 12 ballast vessels outside Ras Laffan at the start of the week, apparently waiting to load and move off. It subsequently emerged that QatarEnergy had reportedly instructed its ships to only make transit into the Persian Gulf the day before loading and to wait outside, in the Arabian Sea, until they were ready to do so. As of 17 June, LNG loadings from Qatar’s Ras Laffan stood at 45 over the prior 15-day period, which is squarely in line with expectations. With indications that insurance requirements have been preventing some shippers from entering the area for the time being, there is scope for further disruption.

18-Jun-2025

SINGAPORE (ICIS)–Thailand’s overall exports in May jumped by 18.4% year on year to $31 billion, due to front-loaded shipments before the US’ temporary of reciprocal tariffs expires in early July. The growth in May was the largest since March 2022 and marked the fifth straight month of double-digit gains, preliminary official data showed on Wednesday. Total shipments to the US – Thailand’s largest exports destination – surged in May by 35.1% year on year, resulting in a trade surplus of $4.6 billion with the world’s biggest economy, according to data released by the Ministry of Commerce. Thailand’s overall imports rose by 18% year on year to $29.9 billion in May, resulting in a trade surplus of around $1.1 billion. For the first five months of 2025, total exports rose by 14.9% year on year to $138.2 billion, while imports were up by 11.3% at $139.3 billion. Without a trade deal, Thailand’s exports to the US will be subject to a much higher tariffs of 36% in early July. Currently, a temporary moratorium allows Thailand and other nations to benefit from a reduced US tariff rate of 10%. The looming tariff hike could significantly hit Thailand’s export-driven economy, which relies heavily on markets like the US for goods such as electronics, automotive parts, and agricultural products. Thai commerce minister Pichai Naripthaphan was quoted by various media as saying on 16 June said that both nations could reach an agreement on possibly setting the US reciprocal tariffs at as low as 10%. Please also visit US tariffs, policy – impact on chemicals and energy

18-Jun-2025

SINGAPORE (ICIS)–Japan's chemical exports in May declined by 5.6% year on year to yen (Y) 928 billion ($6.4 billion), contributing to the first contraction in its overall shipments abroad in eight months which raises the risk of a technical recession in the world’s fourth-biggest economy.  Total May exports fall by 1.7% on year  May exports to US shrink by 11.1% on year  Negotiations on US tariff exemption ongoing Exports of organic chemicals fell by 16.8% year on year to Y148.7 billion in May, while shipments of plastic products slipped by 1.6% to Y266.7 billion, preliminary data from the Ministry of Finance (MOF) showed. By volume, May exports of plastic materials fell by 5.7% year on year to 413,270 tonnes. Japan's total exports for the month fell by 1.7% year on year to Y8.13 trillion, reversing the 2.0% expansion in April and marked the first contraction in eight months – highlighting the impact of US President Donald Trump’s tariffs. With imports falling by 7.7% year on year to Y8.77 trillion in May, Japan registered a trade deficit of Y637.6 billion, extending its run of negative trade balances to two months. Overall shipments to the US – its largest export destination – fell by 11.1% year on year to Y1.51 trillion in May. Japan’s trade surplus with the US shrank 4.7% year on year to Y451.7 billion in May, marking the first decline in five months. Exports of cars to the US slumped by 24.2% year on year to Y358 billion in May, while shipments of motor vehicle parts fell by 19% to Y78.5 billion. Overall chemicals shipments to the US fell by 13% year on year to Y124.7 billion in May. It remains uncertain whether Japan's attempts to secure an exemption from higher US tariffs will succeed. The 90-day suspension on US reciprocal tariffs aimed at narrowing a persistent trade gap with major trade partners are due to expire in early July for most countries, except China. For Japan, Trump has imposed a 25% tariff on imports of cars and auto parts, alongside a baseline tax of 10% on all other Japanese goods. In early June, the levy on steel and aluminum was doubled to 50%. These tariffs are set to remain in place for now, as Trump and Japanese Prime Minister Shigeru Ishiba failed to reach a deal on the sidelines of the Group of Seven leaders' summit, despite two months of bilateral negotiations. The US’ 10% tariff across the board is slated to revert to 24% on 9 July, in line with announcements made in April. During talks at the G7 summit in Canada on 15 June, Ishiba confirmed that while the two countries have yet to finalize a trade package, they have agreed to continue discussions at the ministerial level. WORRIES OVER RECESSION GROWS The decline in exports and the widening trade deficit are fueling concerns that Japan’s economy could contract again in the second quarter, potentially ushering in a technical recession, which is defined as two consecutive quarters of contraction. Japan's economy contracted by 0.2% on an annualized basis in the first quarter, while the country's real GDP in price adjusted terms was flat from the previous quarter. The Bank of Japan (BOJ) on 17 June kept its policy rate steady at 0.5% and has reduced Japanese government bond purchases from by half to Y200 billion starting in April next year. In its policy statement, the BoJ reiterated that “it is extremely uncertain how trade and other policies in each jurisdiction will evolve and how overseas economic activity and prices will react to them”. "The extreme level of uncertainty is holding back the BoJ from raising rates further in the near-term," said Lee Hardman, senior currency analyst at Japan-based MUFG Research. "A trade deal between the US and Japan in the coming months could give the BoJ more confidence to hike rates further if global trade disruption eases as well." The BOJ is expected to maintain a "wait-and-see stance for longer than expected", with central bank governor Kazuo Ueda's remarks on 17 June suggesting a reinforcement of the dovish stance, Dutch banking and financial services firm ING said in a note. Ueda stated that inflation expectations have not yet anchored at 2% and expressed concerns about tariffs potentially affecting future wages. Japan's core consumer price index (CPI) in April rose by 3.5% year on year. "Governor Ueda attributed the majority of downside risks to US trade policy. Therefore, we think that unless Japan and the US reach an agreement on tariffs, the BoJ is likely to maintain its current rate stance," ING said. "Unlike early expectations that Japan might make a deal with the US, negotiations have dragged on longer than expected. Thus, the BoJ's action may be delayed to early 2026." ($1 = Y145.1) Focus article by Nurluqman Suratman Thumbnail image: At a port in Tokyo, Japan, 12 May 2025. (FRANCK ROBICHON/EPA-EFE/Shutterstock)

18-Jun-2025

SAO PAULO (ICIS)–Braskem is to divest its controlling stake at Upsyde, a recycling joint venture in the Netherlands, as the company aims to focus on its core chemicals and plastics production, the Brazilian polymers major said. The joint venture with Terra Circular was announced in 2022 and is still under construction. When operational, it will have production capacity of 23,000 tonnes/year of recycled materials from plastic waste. Braskem’s exit from Upsyde is likely related to the company's pressing need to reduce debt and increase cash flow rather than a rethinking of its green targets, according to a chemicals equity analyst at one of Brazil’s major banks, who preferred to remain anonymous. Braskem's spokespeople did not respond to ICIS requests for comment at the time of writing. The two companies never officially announced the plant’s start-up, and in its annual report for 2024 (published Q1 2025) Braskem still spoke about the project as being under construction. “Upsyde is focused on converting hard-to-recycle plastic waste through patented technology to make circular and resilient products 100% from highly recyclable plastic,” it said at the time. “Upsyde aims to enhance the circular economy and will have the capacity to recycle 23,000 tonnes/year of mixed plastic waste, putting into practice a creative and disruptive model of dealing with these types of waste.” BACK TO THE COREBraskem said it was divesting its stake at Upsyde to focus on production of chemicals and polymers – its portfolio’s bread and butter – and linked the decision to the years-long downturn in the petrochemicals sector, which hit the company hard. Financial details or timelines were not disclosed in the announcement, published on the site of its Mexican subsidiary, Braskem Idesa. “Considering a challenging environment for the petrochemical industry and a prolonged downcycle exacerbated by high energy costs and reduced economic activity in Europe, Braskem is redirecting all resources toward its core business: the production of chemicals and plastics,” Braskem said. “We remain committed to our sustainability agenda, as demonstrated by our recent investment in expanding biopolymer capacity in Brazil and the development of a new biopolymer plant project in Thailand.” The company went on to say it will also continue to maintain “several active partnerships” to advance research and potential upscaling capabilities for chemical recycling, projects for some of which Braskem has signed agreements to be off-takers for specialized companies. The European plastics trade group PlasticsEurope was until this week listing Upsyde as a project which would make a “tangible impact by upcycling mixed and hard-to-recycle” plastic waste in Europe. That entry, however, has now been taken down. Terra Circular and PlasticsEurope had not responded to a request for comment at the time of writing. Braskem’s management said earlier in 2025 the green agenda remains key for its portfolio, adding it would aim to leverage Brazil biofuels success story to increase production of green-based polymers, a sector the company has already had some success with production of an ethanol-based polyethylene (PE), commercialized under the branded name Green PE. The other leg to become greener, they added, was a long-term agreement with Brazil’s state-owned energy major for the supply of natural gas to its Duque de Caxias, Rio de Janeiro, facilities to shift from naphtha to ethane. Last week, Braskem said that deal could unlock R4.3 billion ($785 million)  in investments at the site. GREEN STILL HAS WAY TO GOThe chemicals analyst who spoke to ICIS this week said for the moment there would be no sign of Braskem aiming to trim its green agenda, which has ambitious targets for 2030 in terms of production of recycled materials. He added Braskem’s shift from naphtha-based production to a more competitive ethane-based production will require large investments in coming years, so a strategy to increase cash flow as well as reduce high levels of debt would be divesting non-core assets and the divestment in the Dutch joint venture would be part of that plan. “Braskem has high debt levels, and they are looking for ways to reduce leverage. What they may be thinking is that, despite this divestment in a purely green project, they can still give a green spin to their operations if we consider the green PE, for which they have been expanding production,” said the analyst. “I don't think they would be relinquishing or giving up any of their initiatives to go green, but I think it's probably part of some initiatives they must increase efficiency and reduce costs and capital needs. So, they probably just saw this business as a main candidate to be divested." ($1 = R5.50) Front page picture: Braskem's plant in Triunfo, Brazil producting green PE Source: Braskem Focus article by Jonathan Lopez 

17-Jun-2025

BARCELONA (ICIS)–Europe’s chemical distribution sector is bracing for the impact of multiple geopolitical and economic challenges, including the Israel/Iran conflict. All Iran’s monoethylene glycol (MEG), urea, ammonia and methanol facilities have been shut down For methanol this represents more than 9% of global capacity, for MEG it is 3% Brent crude spiked from $65/bb to almost $75/bbl, against backdrop of reports of attacks on gas fields and oil infrastructure If Iran closes the Strait of Hormuz this will severely disrupt oil and LNG markets Expect extended period of volatility and instability in the Middle East European distributors brace for a VUCA (volatile, uncertain, complex, ambiguous) world Prolonged period of poor demand looms, with no sign of an upturn Global overcapacity driven by China, subsequent wave of production closures across Europe both a threat and opportunity for distributors Suppliers and customers turn to distributors to help navigate impact of tariffs and geopolitical disruption In this Think Tank podcast, Will Beacham interviews Dorothee Arns, director general of the European Association of Chemical Distributors and Paul Hodges, chairman of New Normal Consulting. Click here to download the 2025 ICIS Top 100 Chemical Distributors listing 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.

17-Jun-2025