Insights from ADI Chemical Market Resources

Scope 3 emissions will challenge the chemical industry

The chemical industry is both one of the largest consumers of energy globally and a hard-to-abate sector on carbon emissions. However, as large chemical companies including BASF, Dow, and Solvay have reported, more than ~75% of their emissions are defined as "Scope 3". ADI Chemical Market Resources in this blog investigates what are the different types of emissions and how these companies are being pushed to address direct as well as indirect emissions. Learn more here >>

Key Chemical Industry Drivers

GDP grew across most major economies except India where it contracted
Global GDP is expected to grow by 5.4% in 2021
Auto sales have fallen across major economies and Purchasing Manager’s Index fared well in May except in China and India

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Texas-based Epsilyte acquires Ohio-based EPS compounder Polysource Inc.
Epsilyte Holdings LLC, a provider of expanded polystyrene (EPS) based in Texas, acquired Polysource Inc., Ohio-based EPS compounder and molder of building insulation products, safety helmet liners, and filtration media. Epsilyte, a Balmoral portfolio company, sells EPS materials to packaging, insulating panels, cold chain, and geo-foam markets. Polysource manufactures color EPS resin and specialty EPS copolymers and provides molded EPS parts for child seat interiors, personal safety helmets, automotive packaging, and parts for the construction industry. The acquisition will help Epsilyte grow their product offering and technical expertise.

Dow to build methylene diphenyl diisocyanate (MDI) distillation facility in Texas
Dow is planning to build an integrated MDI distillation and prepolymers facility at its manufacturing site in Freeport, Texas. The new Freeport facility will replace Dow’s current North America capacity in La Porte, Texas and will be able to supply an additional 30% product capacity. The facility is expected to start-up in 2023 and Dow will shut down its polyurethane assets at La Porte site in co-ordination to the plant start-up. The new facility is expected to reduce Dow’s carbon footprint and water usage by eliminating the need for generation of thermal power (utilizing existing thermal energy from the Freeport site), reducing water intake and wastewater discharge (through production efficiencies), and eliminating the need for transport of raw materials.

Chemicals firm, Kemira, completes $83.3 million expansion at Mobile, Alabama plant
Kemira announced completion of its expansion project with new production units for emulsion polymers and bio acrylamide to be fully operational by this summer. Emulsion polymers are used in water intensive applications such as for friction reducers in the oil and gas industry and the market stabilization post COVID-19 is expected to drive demand.

Cargill and Helm to jointly build $300 million bio-based 1,4-butanediol plant in Iowa
Agricultural giant Cargill has formed a joint venture, Qore, with chemical distributor Helm to make bio-based 1,4-butanediol plant at Cargill’s corn-refining facility in Eddyville, Iowa. They will use technology developed by California-based Genomatica to make butanediol from sugar. The 65 ktpy plant will also use wind energy and sustainable agriculture techniques to make product with 93% smaller carbon footprint than conventional butanediol.

India-based Thirumalai Chemicals plans phthalic anhydride (PA) plant in India and maleic anhydride plant in the United States
Thirumalai Chemicals plans to build an integrated plant that will produce 180 ktpy PA plant at its complex in Dahej, Gujarat. The project is also expected to yield 30 ktpy fine and specialty chemicals that will be implemented in two phases. The project is expected to replace significant PA imports in India for consumption of PA and its derivatives such as colorants, polymer additives, and fine chemicals polymers.
Separately, they are also planning to build a maleic anhydride, malic acid, and fumaric acid plant in the United States. The integrated facility will be located in the Northeast U. S. and use butane from the Marcellus and Utica basins as feedstock. The plant is expected to start up in the summer of 2023 targeting markets in North America, Europe, and Latin America.

Prime Polymer to build polypropylene (PP) plant in Japan
Prime Polymer, a joint venture between Mitsui Chemicals, Inc., and Idemitsu Kosan Co., Ltd. Announced the decision to construct a new PP facility at Prime Polymer’s Ichihara Works in Chiba as a part of its plans for its scrap-and-build-style restructuring of its production system. The plant will have the capacity of 200 ktpy PP using Mitsui Chemicals HYPOL process and is expected to start-up in November 2024.

Hyosung plans Vietnamese PP plant start-up after its propane dehydrogenation unit
South Korea-based Hyosung plans to start its second 300 ktpy PP plant at Ba Ria-Vung Tau, now that is has started operations at its 600 ktpy propane dehydrogenation (PDH) unit. The PP unit is expected to start up in third or fourth quarter of 2021. Hyosung had signed an agreement with the Vietnamese government to build a $1.2 Bn complex in early 2017, including a 600 ktpy PDH unit, two 300 ktpy PP units, and LPG storage facilities. The first 300 ktpy PP plant started operations in 2020 relying on Chinese imports of propylene, but a severe global supply shortage in March-April of 2021 led the company to put their plans to start up the second plant on hold until the PDH plant start-up. The plants are expected to lower the import dependency of Vietnam who relied on imports for around 90 percent of its PP consumption in 2020.

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Canadian recycler KC Recycling Ltd. to add polypropylene (PP) extrusion at its facility
KC Recycling has been awarded $852,000 from the CleanBC Plastics Action Fund for a $1.2 million plant upgrade to add PP extrusion to its facility in Trail, British Columbia. The plant currently runs electronic recycling at its facility while growing its car battery recycling operation. Their ~80 million pounds of battery recycling rate generates about 3.6 million pounds of regrind PP per year which is currently exported to PP compounders to be pelletized. The new KC Recycling plant will localize on-site washing, extrusion, and pelletizing, thus creating a closed-loop system.

LyondellBasell signs a long-term supply agreement with Neste for bio-based feedstock
LyondellBasell and Neste have signed a long-term agreement under which Neste will supply 100% renewable feedstock from bio-based sources including waste and residue oils and fats. The feedstock will be processed through LyondellBasell’s plant in Wesseling, Germany into polymers and sold under their CirculenRenew brand name.

Packaging firm, Aptar, introduces fully recyclable mono-material pump for easy recycling
Most packaging solutions use more than one type of plastic which makes collection, sorting, and recycling of waste complex. Packaging firm, Aptar, has launched a fully recyclable mono-material pump for beauty and personal care industries, called Future. The packaging is fully designed using polyethylene only. Future is also available using post-consumer resin (PCR) and they have obtained International Sustainability & Carbon Certification (ISCC) for its European production.

BASF and Mitsui Chemicals plan to collectively promote chemical recycling in Japan
BASF and Mitsui Chemicals have started a collaboration to promote chemical recycling in Japan and evaluate various joint business models and options to commercialize chemical recycling. Japan has been known to export tons of single-use plastic waste to other countries in Asia, but with most of them shutting doors on waste imports, government and agencies will have to find ways to locally recycle waste. Starting 2025, BASF aims to annually process 250 ktpy recycled feedstock globally. Combining BASF’s expertise in chemical recycling with Mitsui’s assets in Japan will serve as a first step towards building circular economy in Japan.

ADNOC to build blue ammonia facility in the UAE to push clean energy
Abu Dhabi National Oil Company plans to build a 1,000 ktpy blue ammonia plant in the industrial hub of Ruwais in UAE. The facility will be a part of the TA’ZIZ industrial park and is expected to start up in 2025. Blue ammonia is conventional ammonia production but where the by-product CO2 is captured and stored. ADNOC currently produces 300 ktpy of hydrogen and plans to increase its capacity by more than 500 ktpy. Their Al Reyadah project can capture 800 ktpy of CO2 from local steel production and they plan to increase their carbon capture and storage capacity to 5,000 ktpy by 2030.

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China ethylene and polyethylene

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