Polymers
Overview
Global polyethylene (PE) and polypropylene (PP) supply and demand dynamics are in transition. Supply is increasing much faster than demand and international trade is shifting due to political and economic events. About 40% of the US polyethylene production is exported, mainly to Asian markets, whereas only about 10% of the polypropylene production is exported, mainly to LATAM markets.
Ethylene prices in Asia and Europe are tied to naphtha whereas ethylene prices in the US are impacted by natural gas and ethane supply. Asia is also self-sufficient on PP whereas they must import 25% of their PE demand.
The impacts of other ethylene and propylene derivatives such as PVC or propylene oxide also require assessment.
Our polymer experts will help you determine what trends to track and how to stay competitive in today’s ever-changing global markets.
Latest polymers news
Browse the latest market moving news on the global polymers industry.
California passes total retail polyethylene bag ban
California passes total retail polyethylene bag ban
Houston, 30 August (Argus) — California lawmakers have passed a complete ban on polyethylene (PE) retail plastic bags, closing a legal loophole that previously allowed thick reusable PE bags made of 40pc recycled plastic. Both the California Senate and Assembly approved the measure, which goes to governor Gavin Newsom (D) for a signature. If he does sign it, the bill would go into effect on 1 January 2026. Flexible plastics reclaimers and a newly formed advocacy group called the Responsible Recycling Alliance (RRA) opposed the bill, citing a higher carbon footprint for paper and reusable bags. A 2014 California law allowed for reusable PE bags in retail stores if they had at least 40pc post-consumer recycled resin. This helped create significant demand for post-consumer recycled flexible PE resin. But the 40pc rule received scrutiny after reports showed that the thicker bags were unrecyclable, despite their labeling. CalRecycle reported that the volume of merchandise bags discarded grew to 231,000 metric tonnes by 2022, a 47pc increase from 2014, when the original plastic bag ban was passed. "It's time for us to get rid of these plastic bags and continue to move forward with a more pollution-free environment," senator Catherine Blakespear (D) said following passage of the bill in the state Assembly. The RRA, the group founded by reclaimers Merlin Plastics, PreZero and EFS Plastics, had argued unsuccessfully that the bags should instead be included in California's extended producer responsibility program. Woven polypropylene (PP) bags were not affected by California's latest bag ban. But a study by market research company The Freedonia Group funded by the American Recyclable Bag Alliance showed that banning PE bags and enforcing reusable PP bags caused virgin plastics usage for bags to rise by 300pc after the ban's passage in 2022. By Zach Kluver Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
BASF to end Ludwigshafen adipic acid production in 2025
BASF to end Ludwigshafen adipic acid production in 2025
London, 29 August (Argus) — German petrochemicals firm BASF will end the production of adipic acid at its Ludwigshafen chemical complex in 2025, the firm said today. Adipic acid is used for the production of aliphatic polyester polyols, which go into polyurethane production for end uses such as elastic foam, coatings and adhesives. BASF had already reduced adipic acid production at Ludwigshafen in a wave of measures announced in 2023 as part of a structural overhaul to ensure future competitiveness of the site and the wider company. The remaining adipic acid capacity was maintained partly to support the production of cyclododecanone (CDon) and cyclopentanone (CPon), but BASF will end production of those products at Ludwigshafen in the first half of 2025, reducing its need for adipic acid at the site. The end of CDon, CPon and adipic acid production at Ludwigshafen next year is intended to improve profitability at the site, BASF said. BASF still has adipic acid production in Chalampe, France, as part of a joint-venture with Domo Chemical which began in 2020. "In the changed market environment [the joint venture] has sufficient capacity to supply the business in Europe", BASF said in 2023 when it first announced the reduction of adipic acid production at Ludwigshafen. By Laura Tovey-Fall Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Opinion: A change of tack
Opinion: A change of tack
The US has come out in support of plastic production caps ahead of the last round of UN Plastic Treaty negotiations, but the impact of its change of tack remains uncertain London, 23 August (Argus) — Last week the United States drastically altered its position for UN global plastics treaty negotiations, saying it would support a global target to reduce plastic production, but the final effect on the treaty's outcome remains to be seen. In the first four rounds of intergovernmental negotiating committee (INC) negotiations, the US — as one of the world's largest plastic producers — has opposed measures against upstream production in favour of limiting the scope of the treaty to waste management and tackling plastic pollution. But it will now take a new position into the intersessional discussions and the final round of negotiations which are scheduled to begin in Busan, South Korea, in late November. The move surprised many analysts and participants, and was quickly denounced by plastic industry bodies such as the American Chemistry Council (ACC) and the Plastics Industry Association. The ACC argued that a global virgin plastics cap would put jobs of petrochemical workers in jeopardy, and increase the cost of consumer goods as packaging companies shift to alternate materials. The Plastics Industry Association pointed to a study which found plastic has lower carbon emissions than other materials, and said the US has undermined its negotiating position. "We are dedicated to keeping plastic waste out of the environment and believe we need to work together to achieve this. However, the White House's drastic position change will not accomplish this goal, only set us back," PIA chief executive Matt Seaholm said. Environmental organisations applauded the effort meanwhile, and argued that plastics production caps would be necessary to cut proliferation of plastic waste. Greenpeace USA said the decision to change positions put the US administration "on the right side of history", and urged the US government to join the European Union in supporting a plan to cut global plastic production by 75pc. What could it mean? The policy change has stirred up strong reactions from both sides of the debate, but it remains to be seen how it will affect the outcome of negotiations. The question of whether a majority vote or full consensus will be required to ratify the final text of the treaty remains open since the first round of negotiations, but International Institute for Sustainable Development's (IISD's) Earth Negotiations Bulletin executive editor Pamela Chasek said that based on experience of similar treaties the latter is more likely. Since the US was one of a number of delegations — mainly from countries with a reliance on plastic-producing industries — to oppose measures against producers in previous rounds of negotiations, its change of heart would not be enough in isolation to push through production caps. The influence of the US may be sufficient to persuade less strident opponents of plastic caps to follow suit, Chasek said, but ultimately the impact will depend on how much leverage the US is willing to use to compel more powerful dissenters to change tack. "This has to be seen in the larger sense of US foreign policy and US strategic interests. The US may not be willing to use political capital in plastics negotiations," she said. The US's forthcoming presidential election could be another factor. Republican nominee Donald Trump, who has expressed opposition to environmental legislation and made statements in favour of increased oil drilling during his campaign, seems unlikely to support caps on plastic production if elected, and even a Democrat victory would deliver a new president to the White House. This puts impetus on the outgoing Biden administration to facilitate an agreement in Busan. The compromises necessary for adoption of a treaty in Busan could lead to a weaker treaty that environmentalists are hoping for, Chasek said, but provide a foundation for a stronger agreement in the future. Why now? The US's volte-face seemed sudden, but Chasek suggested it could have been made with Biden's environmental legacy in mind. She pointed to July's announcement the US federal government will phase out single-use plastics in its procurement, which came just days before Biden announced he would drop out of the election, as evidence he is authentically looking to side more with environmentalists on the issues of plastic and plastic waste. "The federal government is pretty big in terms of purchasing, you're including all the military in that…it's possible that just reducing the use of plastic in the federal government could achieve [reduction] targets the US is willing to agree to", she said, adding such a move on a federal level could persuade other state and local public institutions to follow suit. The policy change may therefore be intended to expedite progress towards a resolution in the UN plastic treaty negotiations, and allow Biden to sign it prior to leaving office. How might recyclers benefit? In many of the end-user markets that recyclers sell into, they compete directly with virgin plastic, so a production cap that reduces availability could help their demand. But this could also be offset if such measures led to lower plastic consumption, which would also reduce the generation of plastic waste feedstock for the recycling industry. More broadly, greater support from the US for the scope of the treaty including measures affecting plastic producers may increase the likelihood of measures to implement extended producer responsibility (EPR) schemes, where producers and sellers of plastic products contribute to the cost of managing the resulting waste. EPR schemes have been shown to increase the collection of plastic waste and provide more feedstock for the recycling industry. But a concern, highlighted by European industry body PlasticsEurope following the last round of negotiations, was a perceived lack of progress towards legally-binding targets to use recycled content, to facilitate the creation of a circular economy and "increase the value of plastic waste". So far there has been no mention of support for such measures from the US, and recycling industry participants will be keeping an eager eye on developments to see how they might benefit from the treaty as discussions come close to their scheduled conclusion. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Borealis, Infinium in CO2-based polymer deal
Borealis, Infinium in CO2-based polymer deal
London, 20 August (Argus) — Austrian petrochemical company Borealis will manufacture polyolefins at its site in Porvoo, Finland using CO2-based "e-naphtha" produced by US by e-fuels firm Infinium. Under the agreement, Infinium will ship "commercial" volumes of e-naphtha to Porvoo from its facility in Corpus Christi, Texas. The first shipment departed the US in May. The e-naphtha is a "sustainable drop-in alternative" to fossil-based naphtha, the firms said. It will be processed in the same way to create polyolefins. E-naphtha can be produced from CO2 from biogenic sources or from carbon capture at industrial facilities such as oil refineries. The e-naphtha feedstock will be tracked through the polymer production process under an ISCC+ certificate, which Infinium's Corpus Christi facility has received. "Atmospheric carbon is a strategic element of the Borealis Circular Cascade approach to foster the transition toward greater circularity in plastics and carbon," said Borealis' vice-president of circular economy solutions Mirjam Mayer. "It allows us to serve the needs of our customers while reducing their carbon footprints." By Will Collins Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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