MARKET DYNAMICS

• The USA is now one of the largest exporters of crude oil. 
• Guyana continues to emerge as a significant player in supply, with Exxon inking a lucrative deal with the Guyanese government.  Still, tensions persist with neighboring Venezuela as they continue with their military buildup along the border.  

TECHNOLOGY OVERVIEW

TECHNOLOGY ENHANCEMENTS IN CRUDE OIL EXTRACTION

• Digital Oilfield & IoT
  • Real-time data collection and analysis through sensors, drones, and remote monitoring allows for optimized drilling and production operations, improving efficiency and reducing costs.
• Artificial Intelligence & Machine Learning
  • AI and ML are being leveraged to analyze vast amounts of geological and production data to identify optimal drilling locations, predict reservoir behavior, and optimize production strategies.
• Robotics & Automation
  • Robots and automated systems are being increasingly used in drilling and production operations, enhancing safety and efficiency in challenging environments.

TECHNOLOGY ENHANCEMENTS IN CRUDE OIL PROCESSING

• Digital Twins & Process Simulation
  • Creating digital replicas of refining processes enables engineers to test and optimize operations virtually, leading to improved efficiency, reduced downtime, and enhanced safety.
• Advanced Analytics & Optimization
  • Data analytics and optimization tools are used to monitor and improve the performance of refining operations, identify bottlenecks, and maximize yields.

RECENT DEVELOPMENTS

Date	Crude Oil Supplier	End User (Company 2)	Development Type	Description	Deal Value
June 2024	Rosneft (Russia)	Indian Refiners	Contract	India wants to strengthen its energy ties with Russia and could seek deals with Rosneft as part of a broader push to boost bilateral trade	-
May 2024	ExxonMobil (US)	Pioneer Natural Resources (US)	Agreement	Long-term supply agreements for US shale oil	$ 60 Billion

Source: Press releases & company websites

DEMAND/SUPPLY OVERVIEW

DEMAND COMMENTARY

• While global oil demand is still expected to increase in Q3 2024 compared to Q2 2024, the growth rate is projected to slow considerably. This aligns with the broader trend of decelerating demand growth observed throughout 2024.
• The road transportation sector, the largest oil consumer, will likely see a slight increase in demand in Q3, driven partly by seasonal factors like summer travel. However, the long-term trend remains a gradual decline due to the increasing adoption of electric vehicles.
• The aviation sector is projected to continue its recovery in Q3, with rising air travel demand contributing to increased oil consumption.
• Demand from the petrochemical sector is expected to remain robust, especially in regions like China, where capacity expansions are ongoing.

SUPPLY ANALYSIS

• The long-term global crude oil supply is predicted to be stable if not oversupplied, with OPEC reducing its demand forecast by 5% through 2025.
• Non-OPEC producers like the USA, Canada, Brazil, and Guyana continue as net exporters as their supply is robust. 

PRICING SITUATION

• In the short term, pricing for the West Texas Intermediate (WTI) benchmark has increased, up $5/barrel since July 2023 to ~$82.
• The Brent crude oil benchmark has followed a similar trend at a relatively higher $90/barrel.
• Pricing pressure remains high partly due to refining costs and geopolitical issues in the Middle East.

MARKET DYNAMICS

• ABS remains well supplied, but certain additives and production costs are expected to keep pricing historically high.
• The automotive industry is predicted to be softer than expected into 2025, a key driver for ABS.
• With increased capacities, the Chinese government launched a trade-in policy to stimulate the economy as imports have become reduced. 
• Rising logistical costs are also playing into reduced imports. 

TECHNOLOGY OVERVIEW

FUSED DEPOSITION MODELING (FDM)

• FDM is the most widely used 3D printing technology for ABS. Advancements in FDM, such as improved print heads and materials, enable faster printing speeds and higher-quality parts.

SELECTIVE LASER SINTERING (SLS)

• SLS uses a laser to selectively fuse powdered ABS, producing complex and durable parts with excellent mechanical properties.

STEREOLITHOGRAPHY (SLA)

• SLA creates ABS parts by curing a liquid resin layer by layer using a laser. This technology offers high precision and smooth surface finishes.

RECENT DEVELOPMENTS

Date	ABS Manufacturer	End User (Company 2)	Development Type	Description	Deal Value
May 2024	LG Chem (South Korea)	-	Product Development	LG Chem has embarked on a project focused on researching and developing innovative plastic materials through the recycling of waste plastics. Among our notable research achievements is the development of PCR (Post-Consumer Recycle) ABS, a plastic product that matches the properties of traditional plastics.	-
February 2024	Styrenix Performance Materials (India)	-	Business Expansion	India’s Styrenix Performance Materials (SPM) expects to begin operations at its expanded acrylonitrile butadiene styrene (ABS) and polystyrene (PS) capacities at Dahej and Nandesari in the western Gujarat state before 2028.	$ 78 Million
April 2024	Trinseo (US)	-	Product Development & Launch	Trinseo announced its new offering of flame-retardant EMERGE PC 8600PV and 8600PR resins, as well as EMERGE PC/ABS 7360E65 resins, manufactured without the use of per-and polyfluoroalkyl substances (PFAS) or halogenated additives.	-

 Source: Press releases & company websites

DEMAND/SUPPLY OVERVIEW

DEMAND COMMENTARY

• Compared to the relatively stable Q2 2024, ABS demand in Q3 experiences a slight slowdown. This is partly due to seasonal factors, as some industries, particularly automotive and construction, tend to have lower activity during the summer months.
• Demand in North America remains subdued in Q3, mirroring the trend seen in Q2. The automotive sector, a critical consumer of ABS, is still facing challenges due to supply chain issues and economic uncertainties.
• European ABS demand sees a slight uptick in Q3, supported by a relatively stable economic outlook and some recovery in the automotive sector.
• China's ABS demand continues to be sluggish due to its economic slowdown.

SUPPLY ANALYSIS

• ABS supply has been adequate but tight, especially in North America.
• The water shortage in eastern Mexico, which caused shutdowns at two significant producers, is returning to normal after the tropical season, which has helped alleviate the drought.  Both have resumed production. 
• Global ABS capacity is still underutilized due to soft markets, especially the automotive sector. Consumption is expected to decline an additional ~2% by 2025.

PRICING SITUATION

• Pricing has increased up to 9% this year, depending on the region. 
• With two major producers in North America still under Force Majeure, pricing is not expected to improve soon but may decline with lower demand.
• The cost of production is increasing due to butadiene shortages caused by unplanned downtime.  
• Antimony, a flame-retardant additive of which 80% is mined in China, is also sharply increasing in price, and shortages are due to mining constraints and increased use in semiconductors and batteries.  

MARKET DYNAMICS

• The current stability in global POM demand suggests a balanced market, but the softer automotive demand and rising resin costs indicate potential headwinds for the industry soon.
• The increase in production costs, especially in NA, will likely put upward pressure on POM resin prices, potentially affecting downstream industries and consumer product pricing.
• Exploring new applications and developing advanced POM grades with enhanced properties could help offset the impact of softer demand in certain sectors like automotive.

TECHNOLOGY OVERVIEW

CONTINUOUS POLYMERIZATION PROCESSES

• Advancements in process control and reactor design have enabled continuous polymerization of POM, leading to improved product quality, increased efficiency, and reduced waste generation compared to traditional batch processes.

MICROREACTOR TECHNOLOGY

• Microreactors offer precise control over reaction conditions during POM polymerization, allowing for tailoring of polymer properties and achieving higher yields.

SUPERCRITICAL FLUID TECHNOLOGY

• This technology uses supercritical fluids, such as carbon dioxide, as solvents and reaction media for POM polymerization. It offers advantages like reduced environmental impact, improved product purity, and enhanced control over polymer morphology.

RECENT DEVELOPMENTS

Date	POM Manufacturer	End User (Company 2)	Development Type	Description	Deal Value
April 2024	Celanese (US)	-	Product Development & Launch	Celanese Corporation unveiled its latest innovations in engineered materials for the electrical/electronics (E&E) and automotive industries. One of these Products is the Hostaform® POM ECO-C/Celcon® POM ECO-C, the only POM available globally that is derived from captured and utilized CO2 emissions.	-

Source: Press releases & company websites

DEMAND/SUPPLY OVERVIEW

DEMAND COMMENTARY

• POM demand slightly increments in Q3 compared to the relatively stable Q2.
• Asia Pacific, the largest consumer of POM, led the demand growth in Q3. China's economic recovery, though slower than expected, is still contributing to increased industrial activity and demand for POM in various applications. Other emerging economies in the region also show promising growth potential.
• Demand in North America and Europe is expected to be relatively stable in Q3.

SUPPLY ANALYSIS

• There are no significant issues with the supply of POM/Acetal products.
• Standard lead times remain 4-6 weeks for domestic supply, with demand remaining flat.
• Global supply has been stable, with imports seeing some lead time increases around shipping.

PRICING SITUATION

• Pricing has been stable to flat globally, although pricing did tick up 1% in North America.
• Production costs have been contributing to the cost increases.
• Imported grades with freight costs will continue to increase as shipping logistics remain stressed. 

MARKET DYNAMICS

• Markets remain stable, but demand is not as strong as predicted, mainly due to the automotive sector.
• Logistics continue to play a role in the increased pricing due to longer shipping routes around Panama and the Red Sea.
• Trinseo's announcement to cease monomer production in the EU has stressed converters and OEMs to qualify for new sources.
• For a couple of years, Covestro has been courted by ADNOC (Abu Dhabi National Oil Co.) and is finally in concrete negotiations for a takeover.  This follows a similar path as their primary competitor, SABIC (formerly GE Plastics in the distant past), which is 70% owned by Saudi Aramco.

TECHNOLOGY OVERVIEW

NON-PHOSGENE MELT PROCESS

• This technology eliminates the use of toxic phosgene gas, traditionally used in PC production, and instead utilizes diphenyl carbonate (DPC) as a safer and more environmentally friendly alternative.

MELT TRANSESTERIFICATION

• This process involves the reaction of bisphenol A (BPA) or other bisphenols with DPC in the presence of a catalyst under high temperature and vacuum conditions. Advancements in catalysts and process optimization are improving the efficiency and quality of PC produced through this method.

REACTIVE EXTRUSION

• This continuous process allows for the direct polymerization and compounding of PC in a single extruder, leading to improved process efficiency, reduced energy consumption, and enhanced control over product properties.

RECENT DEVELOPMENTS

Date	PC Manufacturer	End User (Company 2)	Development Type	Description	Deal Value
June 2024	Covestro (Germany)	Neste, Borealis (Austria)	Collaboration	Neste, Borealis, and Covestro have signed a project agreement to enable the recycling of discarded tires into plastics for automotive applications. When no longer fit for use, tires are liquefied by means of chemical recycling and then processed into base chemicals and further into polycarbonates.	-
June 2024	Teijin Limited (Japan)	-	Product Development & Launch	Teijin Adds New Production Line for Polycarbonate Resin Panlite® Sheet and Film Used in Automotive and E/E Applications	-
January 2024	Mitsubishi Chemical (Japan)	-	Development of Recycling Plant	The Mitsubishi Chemical Group (MCG Group) will start verification testing of a scheme for collecting polycarbonate (PC) resin from headlamps of end-of-life vehicles in the Kanto region in January 2024 with a view to the world’s first commercialization of PC resin chemical recycling.	-

Source: Press releases & company websites

DEMAND/SUPPLY OVERVIEW 

DEMAND COMMENTARY

• PC demand is expected to maintain its upward trajectory in Q3 2024, which is driven by robust demand from the automotive, electronics, and construction sectors.
• The Asia Pacific region is expected to continue driving the demand growth in Q3. The automotive industry in China and India, along with the expanding electronics and construction sectors across the region, are key contributors to this growth.
• PC demand in North America is projected to grow moderately in Q3, supported by a steady recovery in the automotive sector and continued demand from the construction and electronics industries. Whereas the slow, but steady growth in Europe is attributed to the developments in automotive and construction sectors.

SUPPLY ANALYSIS

• PC supply is stable globally, with lead times remaining around 6 to 8 weeks, depending on grade.   
• Producers are still running at lower capacities as demand remains soft in crucial markets like Automotive, but Medical demand is steady.  
• Localized supply is becoming more attractive as freight costs continue to increase.

PRICING SITUATION

• Pricing increased by 3% but is now at the same level as last year.
• The cost of production has increased, lending to producers to press for price increases, attempting to maintain margins.
• Pricing is reduced slightly in the EU and Asia, with demand down in Q3 after the automotive sector grew by less than half as predicted.

MARKET DYNAMICS

• Outside of EV and Electronics, demand remains soft. 
• Electronics production using PBT is shifting to India and China, particularly in the appliance and EV markets.
• Feedstocks for PBT remain stable globally. 

TECHNOLOGY OVERVIEW

CONTINUOUS POLYMERIZATION PROCESSES

• Advancements in process control and reactor design have enabled continuous polymerization of PBT, leading to improved product quality, increased efficiency, and reduced waste generation compared to traditional batch processes.

SOLID-STATE POLYMERIZATION (SSP)

• SSP is a post-polymerization process used to increase the molecular weight and improve the properties of PBT. Advancements in SSP technology have led to more efficient and cost-effective production of high-quality PBT.

TWIN-SCREW EXTRUSION

• Twin-screw extruders are used for both polymerization and compounding of PBT, offering better control over the process, improved mixing, and the ability to incorporate various additives and fillers directly during production.

RECENT DEVELOPMENTS

Date	PBT Manufacturer	End User (Company 2)	Development Type	Description	Deal Value
May 2024	BASF India Ltd.	-	Business Strategy	BASF India Limited will increase its Ultramid® polyamide (PA) production capacity and Ultradur® polybutylene terephthalate (PBT) compounding plant in Panoli, Gujarat, and Thane, Maharashtra. Its Polyurethane Technical Development Center India, to be inaugurated on 28 May in Mumbai, will support market development of polyurethane applications in industries such as transportation, construction, footwear, appliances, and furniture.	-
May 2024	Toray Industries (Japan)	Yazaki Corporation (Japan)	Collaboration (Product Development)	Yazaki Corporation and Toray Industries, Inc. announced today that they have jointly developed a recycled polybutylene terephthalate (PBT) resin grade that uses scrap materials from manufacturing processes to make connectors for automotive wire harnesses.	-
May 2024	SABIC (Saudi Arabia)	-	Product Development & Launch	SABIC announced the availability of VALOX HX325HP resin, a new high-performance, medical-grade, injection molding polybutylene terephthalate (PBT) resin. Developed especially for high-precision parts, such as components of insulin delivery pens, insulin pumps, auto-injectors, and continuous glucose monitors, this new resin combines outstanding processability with high chemical resistance and validated biocompatibility.	-

Source: Press releases & company websites

DEMAND/SUPPLY OVERVIEW 

DEMAND COMMENTARY

• PBT demand is expected to maintain its upward trajectory in Q3 2024, albeit at a slightly moderated pace compared to the earlier part of the year.
• Asia Pacific is expected to continue driving the demand growth in Q3. The upward growth of the automotive industry in China and India is one of the major contributors to the rising PBT demand in the region.
• PBT demand in North America as well as in Europe is projected to grow moderately in Q3, supported by a steady recovery in the automotive sector and continued demand from the electrical and electronics industries.

SUPPLY ANALYSIS

• No widespread supply constraints have been noted thus far in 2024.  A key US supplier, which had supply issues last year, has largely recovered. 
• Lead times are stable at 6-8 weeks.
• The US is a net importer of PBT, while China remains a net exporter.      

PRICING SITUATION

• Pricing is flat or declining globally, with the US index down 2% from a year ago.  The EU and China have seen even more significant declines in pricing, ranging from 8%-12% during the same period.
• Pricing is expected to remain reasonably flat through the end of the summer.  
• China's BDO (butanediol) feedstock costs are still at a 20-year low, resulting in competitive pricing.

MARKET DYNAMICS

• The slower-than-expected automotive market is keeping the demand and supply balance manageable despite challenges caused by weather.
• The expansion of Invista PA6,6 polymer production is completed in Shanghai, China.  Annual capacity will reach 400,000 tons.
• North America continues to be a net exporter of PA, mainly to Canada and the EU.

TECHNOLOGY OVERVIEW

CONTINUOUS POLYMERIZATION PROCESSES

• Advancements in process control and reactor design have enabled continuous polymerization of PA, leading to improved product quality, increased efficiency, and reduced waste generation compared to traditional batch processes.

REACTIVE EXTRUSION

• This continuous process allows for PA's direct polymerization and compounding in a single extruder, resulting in improved process efficiency, reduced energy consumption, and enhanced control over product properties.

MICROWAVE-ASSISTED POLYMERIZATION

• This technology utilizes microwaves to accelerate the polymerization reaction, reducing reaction time and improving energy efficiency in PA production.

RECENT DEVELOPMENTS

Date	PA Manufacturer	End User (Company 2)	Development Type	Description	Deal Value
July 2024	BASF (Germany)	Mercedes-Benz (Germany)	Collaboration	For the Mercedes-Benz VISION EQXX technology program, BASF and Mercedes-Benz jointly developed an impact absorber made of the polyamide particle foam Ultramid Expand.	-

Source: Press releases & company websites

DEMAND/SUPPLY OVERVIEW

DEMAND COMMENTARY

• The global demand for Polyamide (PA), also known as Nylon, in Q3 2024 is expected to showcase moderate growth, building upon the positive momentum observed in previous quarters.
• The Asia-Pacific region, being the largest consumer of PA, leads the demand growth in Q3. China is heavily contributing to increased industrial activity and demand for PA despite the slower-than-expected economic growth.
• PA demand in North America grows moderately in Q3, supported by a steady recovery in the automotive sector and continued demand from the electronics and consumer goods
• European PA demand witnesses steady growth in Q3, with the automotive and industrial sectors being the primary drivers.

SUPPLY ANALYSIS

• Supply of Nylon 6 and 6,6 grades is generally unconstrained.
• Lead times are 6-8 weeks for most grades. 
• North American supply had some temporary effects of supply with reduced production relating to Hurricane Beryl.  

PRICING SITUATION

• NA pricing is up 2% from 1 year ago, with recent pricing pretty flat through the summer.
• The EU saw a slight 2% decrease, and Asia also saw relief in the last quarter but is still 5% above pricing this time last year. 
• The upward pricing trend is expected to increase into 2025 as operating and freight costs increase. 
• Feedstocks will also play a role if additional weather events impact producing areas.

MARKET DYNAMICS

• Most of the industry closely watches the hurricane season, particularly storms in the Gulf of Mexico.
• Invista is back online, running, and working toward a stable inventory position.
• Producers are still advising buyers to take elevated inventory positions as the primary contingency for the remainder of the hurricane season.  

TECHNOLOGY OVERVIEW

SPHERION TECHNOLOGY

• LyondellBasell’s multi-zone circulating reactor technology provides enhanced control over polymerization, leading to improved product homogeneity and tailored properties like stiffness-impact balance.

METALLOCENE CATALYSTS

• The use of metallocene catalysts in PP production allows for greater control over polymer architecture, enabling the production of PP with improved clarity, impact resistance, and processability compared to traditional Ziegler-Natta catalysts.

ADVANCED PROCESS CONTROL AND OPTIMIZATION

• The integration of advanced sensors, data analytics, and machine learning algorithms into PP production processes allows for real-time monitoring, optimization, and troubleshooting, leading to improved efficiency, reduced waste, and enhanced product quality.

RECENT DEVELOPMENTS

Date	PP Manufacturer	End User (Company 2)	Development Type	Description	Deal Value
June 2024	LyondellBasell (Netherlands)	-	Business Expansion	LyondellBasell (LYB) announced today the start-up of an additional production line at the Dalian site of its Advanced Polymer Solutions (APS) business, further expanding its presence in China. The new production line will produce a wide range of high-performance, high-quality polypropylene compounds, mainly supplying the automotive industry.	-
June 2024	Braskem (Brazil)	-	Product Development	Braskem is excited to announce the first sale of chemically recycled polypropylene (PP). Under its circular eco-system brand Wenew, Braskem is now supplying Georg Utz AG, a leading manufacturer of reusable transport packaging in Switzerland.	-
June 2024	Borealis (Austria)	Plastivaloire (France)	Partnership	Borealis is pleased to introduce Borcycle™ GD3600SY, a glass-fiber-reinforced polypropylene (PP) compound with 65% post-consumer recycled (PCR) polymer content. It will first be used in automotive interiors in a landmark project delivered in partnership with Plastivaloire, a thermoplastic injection specialist and Tier 1 supplier to the automotive sector, and Stellantis, an OEM and the owner of 14 automotive brands.	-

Source: Press releases & company websites

DEMAND/SUPPLY OVERVIEW

 DEMAND COMMENTARY

• While PP demand maintained its upward trajectory in Q3 2024, the growth was slightly tempered due to pockets of tightness in the supply of specific grades.
• Emerging economies in the Asia Pacific region show promising growth potential even though the tightness in specific grades impacted certain industries.
• PP demand in North America faced some challenges in Q3 due to the lingering effects of Invista's force majeure and Hurricane Beryl’s aftermath. European PP demand witnessed steady growth in Q3, with the packaging and automotive sectors being the primary drivers. However, the energy crisis and economic uncertainties posed some challenges.

SUPPLY ANALYSIS

• The general supply of PP is stable, but pockets remain where specific grades are still on allocation or tight.
• Multiple producers had temporary shutdowns due to Hurricane Beryl affecting supply.
• Invista in NA has been on Force Majeure most of the spring and summer but is finally back up and running.  However, allocations remain, which are affecting key accounts.  

PRICING SITUATION

• Pricing is up 18% from this time last year. 
• After the low in May, producers pushed increases through the summer due to multiple weather-related shutdowns in NA.
• Barring additional weather events, pricing will likely level off in the new year.