Message in a Bottle: Q1 2025

A quarterly newsletter on Plastics, Logistics, and Flame Retardants

Contents

đŸȘTrade War Escalations & The Impact to Americans
đŸȘAntimony, Antimony, Antimony
đŸȘRecycling News – Plastics Recycling Breakthroughs

Trade War Escalations & The Impact to Americans

On his 13th day in office, February 1, 2025, President Donald J. Trump, through an executive order aimed at curbing illegal drug trafficking, declared 25% tariffs on goods imported from Canada and Mexico, and a 10% additional tariff on goods imported from China. [1]

This does not quite reach the 60% he alluded to on the campaign trail, as we discussed in our last newsletter https://oceanchemie.com/message-in-a-bottle-q4-2024/ . With room to grow, President Trump is willing to increase these tariffs further as he sees fit. For a taste of how quickly things may change, just 2 days after the announcement of the tariffs, on Feb. 3 the tariffs on Canada and Mexico were postponed for 1 month after the neighbors gave promises to increase security at their borders with the US.[2] This pause on the tariffs did not include the tariffs on China, those 10% additional tariffs are in effect.

On February 27, on a post on Truth Social, Trump announced his intent for the tariffs on Canada and Mexico to resume, and for an additional 10% tariff on Chinese goods to go into effect on March 4. [3] Important and critical imports from China now are encumbered by a cumulative tariff of 45%.

In the short-run this adds pressure to manufacturers in the US, who now have their costs increased from goods imported from China, the second largest country of import to the US at 14.5% in 2023. [4]  And the costs of goods imported from Canada and Mexico, which make up 13.6% and 15.2% of US Imports respectively, will add additional pressure for US manufacturers and consumers, and President Trump has confirmed that the 25% tariffs on imports from Canada and Mexico will come into effect in March 2025. [5]

The plastics industry in the US is estimated to comprise $519 billion, and in 2023 exports for the industry totaled $74.2 billion, exceeding total imports of $73.3 billion, a $958 million surplus. And tariffs threaten this surplus. The Plastics Industry Association (PLASTICS), the trade association for the plastics industry in America since 1937, issued a statement expressing concern about an escalating trade war. The deleterious effects on the plastics manufacturing industry in the US via new tariffs will threaten supply chains, increase costs, and erode the trade surplus of American plastics manufacturing. [6] 

And this is just the direct effect on the plastics industry, and adjacent or complimentary industries will be similarly affected, causing a negative feedback loop threatening the industry, and the entire US economy.

The National Bureau of Economic Research (NBER), estimates that the trade war between 2018 and 2021 caused the US to lose real income of 0.17% of GDP, or roughly $40.3 billion. [7] While this number may seem relatively small compared with the GDP of $23.68 trillion in 2021, it puts pressure on industries and companies, already under pressure from inflation.

The idea that tariffs are a tax on the country of export, the country outside the US, is round-about logic. The tariffs are paid by US individuals and companies who import the goods from abroad, and the increased cost is theoretically so great that it is no longer economically viable to buy from said country, causing the imports to cease and therefore reduce the trade and income of the foreign nation. However, these nations will develop trade elsewhere in the world, and cut out the US from opportunities.

One predominant argument put forward by Peter Navarro, Trump’s appointment to senior counselor for trade and manufacturing, is that tariffs do not increase costs to consumers, because foreign companies will just reduce their prices to stay competitive. While this sounds logical it has not been our experience. For every new tariff, we’ve seen companies similarly increase their costs to match the new tariff price.

Even still, domestically many companies will buy goods originating from China that have been transshipped, and have an intermediary port used as the country of origin, thus subverting the tariff and its intended effects entirely. We explored this topic in a previous newsletter here: https://oceanchemie.com/message-in-a-bottle-may-2024/ . And just recently, in the appropriately titled article “A guide to dodging Trump’s tariffs”, the Economist explores how Converse and other firms are tweaking their products slightly to entirely avoid the tariffs, all legal.[7]

We agree that President Trump’s need to curb the illegal drug trafficking is desirable, unfortunately the effect of a blanket tariff on legal imports will do little to achieve this. Instead, these measures will negatively impact manufacturers and consumers in the US, whom President Trump represents.

 [1] – https://www.whitehouse.gov/fact-sheets/2025/02/fact-sheet-president-donald-j-trump-imposes-tariffs-on-imports-from-canada-mexico-and-china/

[2] – https://www.bbc.com/news/articles/c87d5rlee52o

[3] – https://www.nytimes.com/2025/02/27/us/politics/trump-tariffs-canada-mexico-china.html

[4] – https://oec.world/en/profile/country/usa?yearlyTradeFlowSelector=flow1&depthSelector1=HS2Depth

[5] – https://www.cnbc.com/2025/02/24/trump-says-tariffs-on-canada-and-mexico-will-go-forward.html

[6] – https://www.plasticsindustry.org/newsroom/plastics-industry-association-expresses-concern-about-new-tariffs-urges-trade-policies-that-strengthen-u-s-manufacturing/

[7] – https://www.nber.org/system/files/working_papers/w29315/w29315.pdf

[8] – https://www.economist.com/business/2025/02/24/a-guide-to-dodging-trumps-tariffs

Antimony, Antimony, Antimony

Antimony export to the US from China is halted as discussed in our previous newsletters Q3 and Q4 of 2024. For a time China halted export to Mexico and Canada as they were deemed too close to the US, this is how restrictive China is being. Recently they started exporting Antimony once again to other countries, including Mexico and Canada. Companies outside the US that wish to purchase antimony from China must submit detailed company information forms to the Ministry of Commerce (MOC) of China. Those forms can be found here. We have seen companies with subsidiaries or parents in the US have their applications denied.

Companies have been scrambling to source ATO, now at exorbitant prices. Many are sourcing through Thailand and India.

Producers and refiners of ATO outside of China are scarce. US Antimony (NYSE:UAMY) has a production capacity of 6,800 MT of ATO per year, and recently acquired the rights to another mine in Alaska, making 3 mines acquired in the last year.[1][2] They are small, they are backed up, and quite frankly focusing on the wrong part of the problem.

They need to expand their production capacity to keep up with the demand, the sources of the raw antimony will come, they need refiners, not miners.

For some perspective, while US Antimony Corp. is the only refiner in the US, there are multiple 20,000 MT/year refiners in China. The US is behind.

Elsewhere in the world,  in Oman, the most recent and advanced ATO refinery in the world, SPMP, with a production capacity of 20,000 MT/year, suspended operation at the end of 2023.[3] What tragic timing! The stakeholders are looking for $80million to restart operations, in part to pay off old debts.

In a recent article, Xinyu Ru the founder and portfolio manager of Fawkes Capital Management estimates that antimony price could reach $100,000 per ton.[4] Make sure to read this article if you are interested in a detailed breakdown.

Ocean Chemical will continue to keep you informed about the state of Antimony and ATO. Please feel free to reach out to us for comments and questions.

[1] – https://www.usantimony.com/

[2] – https://www.accessnewswire.com/newsroom/en/metals-and-mining/united-states-antimony-corporation-announces-exclusive-option-agreement-to-acquire-971275

[3] – https://www.spmp.co.om/

[4] – https://www.livewiremarkets.com/wires/the-100-000-metal-unlocking-investment-potential-in-antimony-s-supply-crisis

Recycling News – Plastics Recycling Breakthroughs

You know of the garbage patch floating in the ocean. The Great North Pacific Garbage patch is estimated to be 620,000 square miles or 1.6 million square kilometers or, for some real perspective, 6 times the size of the state of Colorado or 3 times the size of the country of France. [1]

The debris is not all trashbags and flipflops. Most of the debris is polyurethane, and it is not so dense that a human could walk across this depressing island. Instead, most of the plastic is fine microplastics, widely dispersed and not visible on satellite nor from the deck of a boat. [2] And while this sounds all at once like a huge problem and also a micro one, the microplastics and the effects of biomagnification adds to the growing concern of the growing amount of microplastics found in our brains and our balls. [3]

Stopping all plastic production and use is a long way off if at all desirable, and plastic alternatives may come with their own problems. A recent study analyzing the necessary crops and trees and their land-use to replace plastics will result in 22% expansion of land mass used for crops of corn and others, and disturbingly a 20% increase in world-wide deforestation. [4] Where can we look to for a solution?

Three more direct solutions will need to come together. For one, The Ocean Cleanup, a non-profit, is already underway cleaning up the ocean debris and river sources since 2013. Their efforts have removed over 21 million kilograms of plastic as of 2025, with the goal of 90% of the plastic in the ocean and rivers to be cleaned up by 2040.[1]

Secondly, a fascinating recent study out of the University of Hawaii (UH) in Mānoa, led by Ronja Steinbach, have demonstrated that marine fungus can be conditioned to degrade polyurethane (OU) plastic at increasing rates.[5] The researchers in effect trained the fungus to degrade PU more quickly than untrained fungus. This shows great promise in the fight against plastic pollution. They caution, however, that these methods are not the “silver bullet”.

The previous two efforts are tackling the symptoms of a world overrun by plastic waste. Our efforts as individuals and communities will make a difference, when we reduce, reuse, and recycle (I know you know, we all know, and while sick of hearing it, it is true). Recycling is real, and the Polystyrene Recycling Alliance (PSRA) is a coalition that represents the entire value chain of polystyrene, its partners include AmSty, INEOS, and Lyondellbasell.[6] About 30% of landfill space is filled with polystyrene.[7] As we discussed in our Q3 2024 newsletter https://oceanchemie.com/message-in-a-bottle-q3-2024/ the US recycling rate is 32.1% and the EU is 48.6%. There is hope for steady progress, and small actions each day make the difference. You know what you need to do.

[1] – https://theoceancleanup.com/

[2] – Philp, Richard B. (2013). Ecosystems and Human Health: Toxicology and Environmental Hazards (3rd ed.). CRC Press. p. 116. ISBN 978-1466567214.

[3] – https://www.nature.com/articles/s41591-024-03453-1

[4] – https://www.nature.com/articles/s41893-024-01492-7

[5] – https://www.tandfonline.com/doi/abs/10.1080/00275514.2024.2422598

[6] – https://psrecycling.org/

[7] – https://epe.global/zh-ecn/2019/11/05/polystyrene-foam-and-ocean-pollution/#:~:text=The%20problems%20with%20polystyrene,trash%20as%20the%20primary%20culprit.

https://oceanservice.noaa.gov/welcome.html

Written by Kent Scholler

Message in a Bottle: Q4 2024

A quarterly newsletter on Plastics, Logistics, and Flame Retardants

Contents

đŸȘChina’s Economic Turmoil
đŸȘFor a Few Antimony More
đŸȘChinese New Years

China’s Economic Turmoil

Economic Uncertainty Looms: China’s Unprecedented Challenges Reshape Global Markets

Over the past 40 years the percent of people in China living in abject poverty has declined from 88% in 1981 to below 0.1% in 2019 [1]. For additional perspective, this shift has accounted for 75% of the global reduction in the number of people living in extreme poverty. And recently, China’s middle class has grown from 3.1% of the population in 2000 to 50.8% in 2018 [2]. China is the world’s second largest economy by GDP, and continuing to grow. So what is happening in 2024?

The housing market, debt, and the response to the COVID pandemic in China have each play a part in this story.

Much of this recent prosperity is thanks to the housing market, which accounts for 25-30% of the country’s GDP up until the sector’s collapse in 2021. Property sales have shrunk for the last 3 years by an average of 20% [3] and today in China there exists unsold floor space larger than the floor space of London and Manhattan combined, and likely more vacant housing than could be filled by the country’s 1.4 billion people according to a former deputy head of China’s statistics bureau [4]. China is now shifting much of this capacity through the Belt and Road Initiative to countries abroad with infrastructure needs. However, the contractions at home have amounted to an unemployment rate at a 6-month high of 5.3%, with that rate at 17.1% for urban youth.

This boom in the housing sector was spurred by China’s response to the 2008 financial crisis when upwards of 13% of the country’s GDP ($555 billion) was spent on infrastructure [5]. Much of this is in the form of debt held by state and local governments banks, many of which are unable to pay their obligation today. This has caused a growing debt-to-GDP ratio, doubling since that time to a current peak of 280%, or $48 trillion compared to their $17 trillion GDP. For comparison the US nation debt is currently $36 trillion and GDP around $29 trillion, making for a 124% debt-to-GDP ratio.

COVID has also slowed China down. China’s response to the COVID Pandemic is what has been called a “zero-COVID” strategy [6], including intense lock-down restrictions on residents and closure of the borders. These restrictions only recently ended at the end of 2022 after nationwide protests of the lockdowns [7]. The restrictions have hurt consumers in China, where consumer spending is around 38% of China’s GDP, much lower than the global average of 55%. This in turn has constrained China’s economy, adding to the economic woes in recent years.

China is on a brink. The confluence of the housing market’s crash, the pilling up of debt, and the additional hindrance of COVID have created a storm in China. According to the J-curve hypothesis, introduced by American sociologist James C. Davies, social and political unrest are more likely to occur in a period of sharp economic decline after a period of sustained economic growth and improvement [8]. 70% of young adults who are unemployed hold a degree, and are overqualified for factory jobs, China’s historically dominant sector. Many educated elites are no longer confident about upward economic mobility for themselves or the next generation [9]. Since 2021 President of the PRC Xi Jinping has revived the Mao-era phrase “common prosperity.” In the 4th quarter of 2024 he approved $1.4 trillion to help the ailing economy, as well as cut interest rates and other important loan and reserve rates [10].  These actions have rallied the Shanghai Stock Exchange to gain 30% between September 13 and October 8, however it has leveled off since then. While there is optimism with the new found boost, and Goldman Sachs predicts that China will become the world’s largest economy over the US, by 2035, other economists believe China will soon peak and begin to decline.

President-elect Donald Trump has spoken on the campaign trail about raising the tariffs on Chinese imports to up to 60% from where they currently stand between 7.5% and 25% [11]. This only adds pressure to an already ailing economy in China, as some companies in the US may see business with China as untenable. This will have implications for the flame retardant market among others, and will cause prices to rise in the near- to mid-term if and when the tariff increases materialize. As your partner, we at Ocean Chemical will work with you for your best solution, even if that means purchasing with another company.

[1] https://openknowledge.worldbank.org/server/api/core/bitstreams/e9a5bc3c-718d-57d8-9558-ce325407f737/content#:~:text=In%202021%2C%20China%20declared%20that,poverty%20line%2C%20the%20speed%20and

[2] https://www.pewresearch.org/global/2015/07/08/a-global-middle-class-is-more-promise-than-reality/

[3] https://www.reuters.com/world/china/why-chinas-economy-is-more-vulnerable-trump-tariffs-this-time-2024-11-06/

[4] https://www.state.gov/briefings-foreign-press-centers/global-implications-of-china-economic-expansion#:~:text=The%20first%20challenge%20to%20China’s,for%20China’s%20global%20economic%20strategies.

[5] https://www.reuters.com/breakingviews/chinas-growth-is-buried-under-great-wall-debt-2023-09-13/

[6] https://www.isglobal.org/documents/10179/7943094/26_ISGlobal+COVID19+y+COVIDCero+o+Maxima+Supresion+EN/0a4e83bb-6257-4f5d-8960-16c323b464b2

[7]  https://www.nytimes.com/2022/11/24/world/asia/china-unrest-covid-lockdowns.html

[8] https://louischauvel.org/DAVIES2089714.pdf

[9] https://www.theguardian.com/world/2023/sep/11/have-we-reached-peak-china-how-the-booming-middle-class-hit-a-brick-wall#:~:text=Definitions%20of%20what%20constitutes%20the,ranks%2C%20predicts%20Boston%20Consulting%20Group.

[10] https://www.scmp.com/economy/policy/article/3283561/chinas-stimulus-salvo-enters-second-month-our-overview-and-what-comes-next

[11] https://www.theguardian.com/business/2024/nov/25/trump-tariff-on-china-could-lower-global-inflation-says-bank-economist

For a Few Antimony More

We discussed the current state of Antimony prices and restrictions in our last newsletter. And in this article we will explore the antimony market further, and implications of the export restrictions as well as the proposed tariff increases from president-elect Donald Trump.

To reiterate, Antimony is listed as a mineral critical to U.S. economic and national security by the U.S. Department of Interior, a list that includes Uranium among others [1]. Antimony is used in flame retardants, lead-acid batteries, and a variety of military applications that include explosives, and nuclear weapons.

China has the largest reserves of antimony in the world, according to the US Geological Survey (USGS), as well as the largest production capacity, and is the source of 63% of the US antimony [2]. Below in Figure 2.1 is an in-depth breakdown of Antimony in the world.

China’s export restrictions on Antimony that went into effect in September of this year 2024, subsequently caused the increase in price of Antimony and ATO to ranges of $15-$22/lb in the US. In China the price is dropping as warehouses become backed up with unsold antimony.

This state-of-affairs holds with micro-economics, where shifts in the demand curve in China is causing the price to drop, while in the rest of the world the supply curve has shifted, causing a startling increase in price. See Figure 2.2.

In the future, if the export restriction is lifted there will be a crash in the price back to a higher equilibrium price. Meanwhile the world will look elsewhere for production of antimony. The United States Department of Defense (DOD) has responded by investing $25million in Perpetua Resources to develop Stibnite mines (Stibnite abbreviated Sb is antimony), and in talks with US Antimony Corp to expand their production capacity [3][4]. United States Antimony Corp. (NYSE: UAMY) has seen their stock soar 630% in the last year, and more recently has acquired the rights to two mines in Alaska [5].

In early December the Chinese Commerce Ministry announced a new ban on the export of gallium, germanium, and antimony, along with other high-tech materials to the US in retaliation to the US Commerce department listing 140 China-based or Chinese-owned companies that will have export licenses be denied for any US company trying to do business with them. The US Commerce department action is done due to national security interests regarding semi-conductors and other AI technologies [6].

What complicates the situation further is if president-elect Donald Trump follows through on his campaign promise to increase the tariffs on Chinese imports up to 60% from where they currently stand between 7.5% and 25% [7]. Given that the rest of the world does not yet have the production capacity to fully replace China’s antimony production capabilities, the US will see higher prices for antimony and ATO in the near- and mid-term future. Ocean Chemical and their customers have seen prices ranging from $11 up to $25.

[1] https://www.usitc.gov/publications/332/executive_briefings/ebot_a_critical_material_probably_never_heard_of.pdf

[2] https://pubs.usgs.gov/periodicals/mcs2024/mcs2024-antimony.pdf

[3] https://www.defense.gov/News/Releases/Release/Article/3249350/dod-issues-248m-critical-minerals-award-to-perpetua-resources/

[4] https://www.fastmarkets.com/insights/us-antimony-talks-smelter-expansion-andrea-hotter/

[5] https://www.miningnewsnorth.com/story/2024/11/08/news-nuggets/us-antimony-stakes-another-alaska-project/8785.html

[6] https://apnews.com/article/china-us-tech-semiconductor-chip-gallium-6b4216551e200fb719caa6a6cc67e2a4

[7] https://www.theguardian.com/business/2024/nov/25/trump-tariff-on-china-could-lower-global-inflation-says-bank-economist

Chinese New Years

Chinese New Years in 2025 will be celebrated between Jan 25, 2025 – Feb 14, 2025 .

The main celebration of New Years Day falls on Jan 29, 2025, the day of the new moon signaling the end of Winter, and marks the start of the year of the Snake. Wikipedia’s article has more details regarding the cultural practices and history [1]. Celebrations for the new year will be held for 16 days and typically end with the Lantern Festival, which falls on Feb 12, 2025 in the upcoming year.

During these celebrations Chinese companies and exports will close down. Most companies expect to be returning Feb 3, 2025, after the Golden Week, and some will extend through the week of the Lantern Festival, returning Feb 17, 2025.

If you feel you may need material from China in February or March, you will benefit from a plan to order in early January. We at Ocean Chemical are standing by to make the logistics journey with you!

[1] https://en.wikipedia.org/wiki/Chinese_New_Year

Message in a Bottle: Q3 2024

A quarterly newsletter on Plastics, Logistics, and Flame Retardants

Contents

đŸȘAntimony Aggravation
đŸȘPlastics Industry Under Attack
đŸȘFreight Updates
đŸȘFlame Retardants Series Part I: A Brief History of Bromine

Antimony Aggravation

China on Sept 15 will impose restrictions on the export of Antimony ore, metal, and Antimony Oxide, adding to a list of restrictions on rare earth metals that includes gallium and germanium, elements used in micro chips, solar cells, and high tech equipment [1].  China produces 48% of the world’s mined Antimony, and antimony metal is used in ammunition, missiles, and military equipment.  The Commerce Ministry states these restrictions are not aimed at any one country, and that the restrictions are “in order to safeguard national security and interests, and fulfill international obligations such as non-proliferation.”

One form of antimony that interests us is Antimony Trioxide (ATO). used as a synergist with Halogenated flame retardants (FR).  Antimony trioxide doesn’t have flame retardant properties on its own, but when it reacts with halogenated compounds, it creates chemical compounds that do.  This reaction occurs when antimony trioxide reacts with halogenated acids generated by the flame retardant to form antimony oxyhalides, free radicals.  Antimony trioxide can enhance the activity of halogenated flame retardants, so less of the halogenated compound is needed to achieve the same level of flame retardancy.   ATO is used in a variety of plastics and end products.

We asked our colleagues in China about these restrictions and their impact on the market.  They point out that ATO for FRs is of grades 99.5%-99.9%, and the military grade is 99.99%, yet the impact on Antimony ore, the raw material, will increase market price of ATO.

Additionally the supply of Russian antimony ore imported to China for refinement is slowing as 98% of Chinese banks are now unwilling to accept payment from Russia [2].  This slowing is due to the sanctions imposed since the conflicts began in 2022.  While there are work-arounds to the banks, this tightening of the supply of antimony adds to the market pressures, and subsequently causes the price of ATO to increase further.

So then the supply and export of ATO for FR to the broader market will continue, and the pressures on raw Antimony ore will cause the price to increase.  2024 has seen a rise in the price of ATO, prior to these restrictions.

Over the first three quarters of 2024 ATO price increased 98.76% in the NA market.  Our colleagues in China speculate that through 2024 the prices will continue to increase, though note that the increase will not be as drastic as the beginning of 2024.  One reason for this may be that the miners and suppliers of ATO in China knew of these impending restrictions, and are in-front of the curve.  The increase and subsequent market clamor highlights the US reliance on imported Antimony, which is unlikely to change quickly.  We will keep our eyes open for the future of Antimony and ATO.  Good news for FR is there are alternatives to ATO for flame retardants and synergists.

[1] Reuters. China Curbs Exports Strategic Minerals. 2024-08-15.

https://www.reuters.com/markets/commodities/chinas-curbs-exports-strategic-minerals-2024-08-15

[2] BusinessInsider. Nearly all Chinese banks are refusing to process payments from Russia, report says. 2024-08-14.

https://www.businessinsider.com/russia-economy-all-china-banks-refuse-yuan-ruble-transfers-sanctions-2024-8

Plastics Industry Under Attack

White House on Limiting Virgin Plastics Production

In July 2024 the Whitehouse released the report MOBILIZING FEDERAL  ACTION ON PLASTIC POLLUTION: PROGRESS, PRINCIPLES,  AND PRIORITIES [1].  The report highlights activities to reduce plastic waste, by eliminating single-use plastic from federal operations, citing that plastic waste has doubled in the past two decades. We are familiar with the tragic photos and scenes of plastic piled in mounds on the beaches, and in our oceans.  The report highlights a growing focus on single-use plastics and the plastics industry in the global responsibility for climate change.

In an effort to address the growing climate change, the United Nations Environmental Assembly (UNAE) began a resolution [2] that seeks to be legally binding to signatories, to manage the full lifecycle of plastics, from design, production, to disposal.  On Wednesday, August 14, the US White house officials came out in support of additions to the UN Plastics treaty calling for yearly limitations on virgin plastics production [3]. This is seen as a position reversal.  Environmental groups supporting the position, and plastics and manufacturing groups denouncing the move, came out shouting hyperbole and concern for the future.  The move by the White House comes three months before the treaty is to be finalized on November 25th in Busan, South Korea.  Notably this is after the US presidential election on November 7th.  Given the late hour, what does this move signify? A symbol “that raises ambitions” as the white house put it.  There is a vocal minority in support of the addition, with China and Saudi Arabia supporting the treaty without the addition. Even if the addition makes it into the treaty, and the US signs on, and the senate agrees, the US is capable of pulling out of the treaty or ignoring it. This token gesture is not the attack on the plastics industry.

The focus on single use plastic comes as plastic manufacturing is a locus for fossil fuel use, from production, transportation, and raw materials that are and use fossil fuels.  So when a product of plastic that is designed to be recycled is instead thrown away to landfills, adding to our pollution rather than reducing pollution, we see the problem with single-use plastic.

The question is, what do we do to increase recycling?  November 15 is America Recycles Day, a day to recognize the importance and impact of recycling, which has contributed to American prosperity and the protection of our environment.  The US Recycling rate is 32% [4].  While a majority of pollution comes from other nations, and industries, and we by all means need to push to have those polluters reduce their emissions, we as individuals have the ability to make an impact here and now by recycling more.  The EU recycle rate is 48.6% [5]. The plastics industry is under attack from all of us when we throw recyclable plastics into the trash. We need to recycle those plastic bottles, and containers, promote the circular economy, and drive progress.

[1] US White House. MOBILIZING FEDERAL  ACTION ON PLASTIC POLLUTION: PROGRESS, PRINCIPLES,  AND PRIORITIES. 2024-07.

www.whitehouse.gov/wp-content/uploads/2024/07/Mobilizing-Federal-Action-on-Plastic-Pollution-Progress-Principles-and-Priorities-July-2024.pdf

[2] UNEP. Resolution 5/14 “End plastic pollution: Towards an international legally binding instrument” . 2022-05-10.

wedocs.unep.org/bitstream/handle/20.500.11822/39812/OEWG_PP_1_INF_1_UNEA%20resolution.pdf

[3] Reuters. In shift, US backs global target to reduce plastic production, source says. 2024-08-14.

https://www.reuters.com/sustainability/shift-us-backs-global-target-reduce-plastic-production-source-says-2024-08-14

[4] EPA. America Recycles Day. 2023-11-15.

https://www.epa.gov/circulareconomy/america-recycles-day

[5] EEA. Waste and Recycling. 2024-02-22.

https://www.eea.europa.eu/en/topics/in-depth/waste-and-recycling#:~:text=The%20EU’s%20recycling%20rate%20of,of%20municipal%20waste%20is%20landfilled.

Freight Updates

Navigating the Tides of Change – The Future of Logistics in 2024 and Beyond

In the ever-evolving world of logistics, staying ahead of the curve is not just an advantage—it’s a necessity. As we look towards 2024 and early 2025, the transportation industry is poised for significant shifts that will reshape how we move goods across the country. Let’s dive into the forecast and explore what it means for businesses nationwide.

The Road Ahead: A Rollercoaster of Costs

C.H. Robinson’s latest forecast paints an intriguing picture for the coming year. Dry van linehaul costs are expected to take a 5% dip year-over-year in 2024, while refrigerated transport sees a more modest 3% decrease. But don’t be fooled by these numbers—the journey ahead is far from smooth.

As we bid farewell to the traditional produce season surge, we’re witnessing a fascinating shift in capacity tension from the sun-soaked South to the cooler North. This geographic dance of supply and demand will likely spark a reimagining of routing strategies, potentially breathing new life into regional economies along the way.

The Ebb and Flow of Market Dynamics

In the near term, expect a lull in demand and a slight reprieve in costs. But as we roll into the fourth quarter, brace for the familiar holiday rush and year-end scramble, coupled with a touch of carrier attrition that will tighten the market.

The dawn of 2025 will bring a post-holiday cooldown, but don’t expect prices to plummet to their previous lows. As spring turns to summer, keep your eyes on the horizon—the annual produce season will usher in another wave of cost increases.

Riding the Waves of Change

So, what does this mean for your business? It’s time to get creative and adaptable:

  1. Embrace the Volatility: The market will be a rollercoaster—make sure your strategies are flexible enough to handle the twists and turns.
  2. Think Regionally: With capacity shifting between North and South, it might be time to reconsider your distribution networks.
  3. Stay Agile with Contracts: Short-term or flexible contracts could help you capitalize on cost fluctuations.
  4. Master Your Inventory: Fine-tune your inventory management to navigate seasonal cost spikes without breaking the bank.
  5. Invest in Smarts: Predictive analytics and optimization tech could be your secret weapons in this changing landscape.
  6. Mix It Up: With different forecasts for dry van and refrigerated transport, don’t be afraid to shake up your modal choices.

As we sail into this new era of logistics, one thing is clear: the ability to adapt quickly and intelligently will separate the industry leaders from the pack. By staying informed and nimble, your business can turn these market shifts into opportunities for growth and innovation.

Remember, in the world of logistics, change is the only constant. Are you ready to ride the wave?

CH Robinson

https://www.chrobinson.com/en-us/resources/insights-and-advisories/north-america-freight-insights/august-2024-freight-market-updates/

Flame Retardants Series Part I: A Brief History of Bromine

Bromine’s versatile journey began with two independent discoveries by chemists Antoine Balard and Carl Jacob Lowig in the mid-1820s.  While studying salt water after distillation, a dark red liquid remained, bromine.  Their work unlocking bromine’s elemental properties paved the way for its widespread adoption across industries over the next 200 years.

Within just a decade of its discovery, by 1835, bromine compounds were already being utilized for medical purposes – an early hint at their future importance in pharmaceuticals, drug development, and disease treatments. In the First World War Bromine as xyxyl bromine was used as poison gas. In the 1930s bromine was used for water purification and disinfection.

Bromine’s commercialization took off in the 1950s with fire safety applications. The 1960s brought brominated rubber that made tubeless tire inner linings possible. More recently, bromine has reduced mercury emissions from coal plants since 2000. Recently, a 2014 study notably found bromine is one of just 28 elements essential for tissue development in humans and animals.

From its initial discovery nearly 200 years ago, bromine has followed an intriguing trajectory, with its versatile applications expanding across vital industries like medicine, water treatment, tires, and emission reduction, and its significance continues to grow to this day. Currently bromine’s role in flame retardants is crucial, and the largest use of bromine today is fire safety.

BSEF – International Bromine Council

https://www.bsef.com/about-bromine/what-is-bromine/history/

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Message in a Bottle: June, 2024

Contents

đŸȘBromine Prices
đŸȘNPE 2024 Recap
đŸȘFreight Updates

Bromine Prices

Bromine Market Rides Supply Shocks and Demand Revival

Prices for the industrial workhorse chemical bromine are pushing higher amidst tightening global supply and rebounding demand from key sectors. In China, a bromine production hub, domestic prices climbed nearly 2% in May to 20,800 RMB/ton ($3,065) even as upstream costs fell. Providers competed for limited supply to serve still-resilient downstream industries like flame retardants.

The supply crunch for bromine intensified in the U.S. towards late April as disruptions from the Red Sea crisis impacted imports from major suppliers. This tight availability collided with firm domestic demand, notably from construction and other segments, driving prices upwards. Despite logistics constraints, leading U.S. producer LANXESS remained optimistic for volume growth. Domestic demand stayed robustly above 2023 levels.

Looking ahead, data points to further bromine price gains driven by steadying economies, rising consumer spending, and overseas demand revival. Any easing of persistent supply chain frictions could accelerate the upward pricing momentum. Market participants closely eye shifting supply/demand dynamics in the fast-evolving landscape.

Sources:
ChemAnalyst
Intratec
SunSirs

NPE 2024 Recap

NPE2024: The Plastics Show closed out a historic week in Orlando, solidifying its reputation as the premier plastics industry event in the Americas. The show drew an incredible turnout of over 50,000 registrants, including a remarkable 63% who were first-time NPE attendees.

In a promising sign for the industry’s future, 30% of this year’s attendees were under 40 years old – one of the youngest audiences NPE has ever welcomed. This fresh-faced turnout reflects rising enthusiasm for innovation, sustainability and plastics’ promising trajectory.

The global draw of NPE also reaffirmed the show’s international clout. More than 15,000 international registrants from 133 countries made this the most internationally attended NPE in history, up nearly 10% from the 2018 event. From sold-out networking events to the packed expo halls, NPE2024 was fostering worldwide collaboration.

To get a recap of NPE2024, visit npe.org/npetv for daily episodes of the innovations on the show floor. The NPE team looks forward to the next show happening May 3-7, 2027, in Orlando, FL.

For updates on NPE2027, visit NPE.org

Freight Updates

Shipping and Trucking Trends Impacting Costs

The global supply chain continues to face a mix of challenges and optimizations. Efforts to enhance efficiency at the Panama Canal are bearing fruit, with an increase in slots per day facilitating smoother transit for vessels. However, severe weather events in recent weeks have added to port congestion at major transshipment hubs like Busan and Singapore. Meanwhile, instability in the Middle East has many carriers rerouting freight away from the Red Sea and Suez Canal.

On the trucking front, the 2024 dry van linehaul cost forecast remains at a 2% year-over-year decrease. As expected during the produce season, temperature-controlled freight rates are increasing first. Despite an oversupply in the market, rate increases are anticipated through May for both dry and refrigerated vans. However, spot rates are still below breakeven costs, indicating a loose environment likely continuing into June.

Looking ahead, an extended forecast offers projections into early 2025. After the holiday peak late this year, rates are expected to decrease for a few months. However, the rates are not projected to reach the lows of 2023 or 2024 during this period, suggesting a potential tightening of the market next year. The outlook remains mixed, with lingering overcapacity pressuring costs down but seasonal patterns and gradual supply/demand rebalancing pointing to higher costs ahead.

For More Insight, check out C.H. Robinson: https://www.chrobinson.com/en-us/
C.H. Robinson did not pay for this promotion

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Message in a Bottle: May, 2024

Contents

đŸȘNATIONAL PLASTICS EXPO (NPE) 2024
đŸȘDUTY/TARIFF VIOLATIONS
đŸȘFREIGHT UPDATES

NPE

NPE2024: The Global Plastics Innovation Showcase

Get ready for the biggest plastics event in the Americas! NPE2024: The Plastics Show is taking over the Orange County Convention Center in Orlando from May 6-10, 2024. This massive trade show is the premier stage for groundbreaking innovations across every sector of the $600 billion+ plastics industry.

With mind-blowing innovations and future-focused insights all under one roof, NPE2024 is an absolute must-attend for anyone working in the plastics realm. In addition to over 1 million square feet of exhibit space showcasing the latest products from 2,000+ companies, NPE offers over 100 sessions and workshops led by global leaders. Key topics include the circular economy, recycled plastics, AI/automation, workforce trends, and sector-specific updates for automotive, healthcare, consumer goods and more. With 55,000+ attendees from 110+ countries, it’s also a prime networking hub to unveil new offerings and forge international partnerships.

For More Information Visit the NPE website: https://npe.org/
The Exhibitor List: https://npe.org/exhibitor-list/
The Tech Zones: https://npe.org/tech-zones/

Date: May 6-10, 2024
Location: Orlando, Florida, USA

Ocean Chemical will be attending the NPE! Contact us to see when we can best meet.

Duty/Tariff Violations

Protecting Your Business and Upholding Fair Trade Practices

In recent years, there has been a disturbing rise in importers using shady transshipment and misclassification tactics to evade antidumping duties, countervailing duties, and Section 301 tariffs – especially on chemicals like citric acid, sodium gluconate, and xanthan gum from China. Transshipment involves rerouting Chinese products through third-party countries and falsely labeling them as originating from those nations to dodge duties. Misclassification means deliberately misidentifying products to exclude them from tariff orders. Both are fraudulent maneuvers that undermine fair trade.

Recent cases underscore the government’s intensifying crackdown on duty evasion schemes. In March 2024, a New Jersey importer pleaded guilty to mislabeling $1.4 million worth of hazardous Chinese chemicals and agreed to pay $3.1 million for evading duties through falsified documents. That same month, U.S. Customs launched a probe into whether an importer transshipped xanthan gum from China through Israel to sidestep antidumping duties.

We at Ocean Chemical strive to conduct our business with the utmost integrity when it comes to trade compliance. We will never participate in duty evasion that cheats the system and compromises ethical business standards. By remaining vigilant and upholding fair trade principles, we can level the playing field and promote an equitable global marketplace.

Customs and Border Patrol EAPA Allegations:
https://www.cbp.gov/trade/trade-enforcement/tftea/eapa
Penta Settlement
Guy & O’Neil Investigation Commencement

Freight Updates

Ocean Freight: Navigating the Ebb and Flow

As the traditional slow season kicks in on major trade lanes, ocean carriers are adjusting capacity through blank sailings and service reshuffles to balance supply and demand. Meanwhile, the major alliances are undergoing a shakeup – the Ocean Alliance has been extended through 2032, while the new Gemini Alliance between Maersk and Hapag-Lloyd launches in early 2025. On the Asia trades, spot rates continue softening despite ongoing Suez disruptions, with the April 1 rate increase providing only temporary reprieve as significant capacity increases may keep rates volatile to North Europe.

All eyes are on upcoming labor talks in North America, with potential rail disruptions in Canada by late May and concerns over stalled ILA negotiations that could trigger an October strike on the U.S. East/Gulf coasts. On the export side, Asian transshipment hub congestion is causing 2-week delays. The fluid Suez situation is absorbing 6-9% of global capacity, while U.S. import volumes surged over 15% year-over-year in March. The Panama Canal is increasing slot capacity to ease disruptions.

Latin American demand remains robust at 80-90% utilization, though port congestion plagues areas like Brazil. Oceania is contending with disruptions and service changes. The Middle East/South Asia face equipment shortages on delayed sailings. Rate levels may drop on some trades if overcapacity persists. Despite headwinds, the market landscape remains dynamic. Shippers must stay nimble and seek strategic partnerships to navigate the ebb and flow.

For More Information Visit C.H. Robinson’s website:
Transportation Market Insights and Advisories
C.H. Robinson did not pay for this promotion

Large Container Cargo Ship

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What You Need To Know About The Decline In Flame Retardant Production In China.

What You Need To Know About The Decline In Flame Retardant Production In China

In 2021 the production of chemicals in China started to decline rapidly, including the production of flame retardants. This significant decline has continued into 2022 and doesn’t seem to be improving any time soon. 

What is causing this decline and how is it affecting businesses all over the world?

Several factors are causing the decline in flame retardant production. This includes the increased pressure from the Ministry of Environmental protection. 

Since 2020 there have been serious concerns about the environmental impacts of flame retardant and other chemical production. So, it’s no surprise that there’s been a decline in production to help create a more environmentally friendly country. 

However, this still makes it difficult for companies that rely on flame retardants and other chemicals. But what can you do to help your company get what it needs to thrive?

Today we’re going to be discussing the decline in flame retardant production and why it’s happening now. We’ll talk about how it’s affecting businesses and how there are actually some positives to come out of the low production rates. 

What’s causing the decline in flame retardant production?

In 2021 and continuing into 2022, chemical production, including flame retardants, has been on a steep decline in China. 

Several factors are causing this decline, but the most important aspect involved is the pressure from the Ministry of Environmental Protection. They’re putting a strain on companies to meet higher pollution control standards. This strain is affecting the production of chemicals and reducing the output. 

Yes, this pressure to create better environmentally friendly production standards is excellent for the world long term. It’ll help battle the effects of global warming and create a safer world. But, it has still caused incredibly painful shortages in 2021 and now in 2022. 

China’s goals for carbon neutrality and the effect it has on flame retardant production

Back in 2020, just before the global pandemic, China’s President Xi Jinping announced that his country would aim to peak carbon dioxide emissions by 2030. He also wanted to aim for carbon neutrality before 2060. 

This statement by President Xi Jinping has now been confirmed during the COP26 global climate summit in Glasgow. China’s official position after the global climate summit was to: 

Part of the measures needed to meet these goals include stricter environmental controls on industrial plants. In order to meet the new standards and help China achieve carbon neutrality by 2060, companies have now had to cut back on production. 

Companies that produce chemicals like flame retardants have to cut back in the short term. This is so they can upgrade their pollution controls and make the emissions from the factories less hazardous to the environment. 

How is the decline in flame retardant production affecting businesses?

Businesses everywhere, not just in the US, are finding it hard to get flame retardants and other chemicals for their projects, products, and business in general. 

Because of this decline in production, the demand for the products has only gone up, making them expensive to import. 

With this rise in price, companies are put under a lot of stress when it comes to developing the products and projects their clients are used to. 

They end up having to raise their prices to compete with the rising cost of flame retardants. This only ends up causing more issues for their end clients and making it difficult for smaller companies to get the flame retardant and other chemicals they need. 

What else has affected flame retardant production?

The decline in flame retardant production because of environmental reasons is a huge issue for companies. But it’s not the only thing that’s hindering production. The lack of chlorine and bromine production has also reduced the production of flame retardants. 

In our last blog post, you can learn more about how the stall in chlorine production over the pandemic has caused issues with flame retardant production. 

If you’re looking to order flame retardants and smoke suppressants, Ocean Chemical is here to help. 

Our team has extensive knowledge in flame retardant production. We will provide your business with the products it needs to complete your work during these shortages. 

With over 25 years of flame retardant industry experience, we’re the right choice for all your brominated, non halogenated, and synergist flame retardant solutions. 
We want to make sure all our clients get exactly what they need for their business. Get what you need today by getting in touch with the talented team at Ocean Chemical.

What Are The Lead Times To Import Flame Retardants From China?

Why Are The Lead Times To Import Flame Retardants From China So Long?

Are you currently in the market for flame retardant imports from China? Have you noticed the lead times have seriously shot up over the last couple of years? 

If you have noticed the lead times for flame retardants going up over the last year or so, then you probably want to know why it’s happening and what you can do to help. 

The global demand for cargo transportation has gone up 8% since 2020 and continues to increase as we speak today. This global demand is putting a lot of pressure on workers at both ends. Causing delays and issues when it comes to importing flame retardants. 

Nobody wants to wait months to get the flame retardant they’ve been waiting on for their product or project. So, we want to provide you with the information you need to know to understand the current situation. 

We’re here to tell you all about the various reasons why flame retardant is taking longer to get to you from China and what you can do to help get flame retardants delivered to your business sooner. 

How much has the flame retardant import lead time increased?

A year or so ago, it only used to take 6-8 weeks to receive flame retardant from China, but now it can take anywhere from twelve weeks up to fourteen weeks. This includes brominated flame retardant, non halogenated flame retardant, and synergist flame retardant. All of it is taking incredibly long to get to the US.

This is such a drastic change from the lead times we were used to, which is causing many issues in businesses. It has seriously slowed down projects and made it difficult for many companies to continue their work.  

But why does it take so long to import flame retardant from China? How can we work together to help speed up the process and get companies the flame retardant they need to complete their projects? 

Why does it take so long to import flame retardant from China?

The main culprit behind the considerable delays in flame retardant delivery rests in the hands of the containers aboard the steamship lines. 

In order to transport flame retardant of any kind from China to the US, you have to book a container on a steamship line. This used to take about a week to do, but now it takes businesses anywhere from two to four weeks to get a boat booked. 

Why does it take so long to book a boat?

Right now, there aren’t as many boats as there used to be, so booking a boat to transport flame retardant from China to the US takes a lot of time to organize. 

As soon as you book your boat, you’re essentially put on a waiting list until the next ship is available. This could take up to four weeks. 

Even when you manage to get a boat sorted to carry the cargo, it takes longer to offload cargo once your container gets to the west coast of the US. This is because, on the US side, there is also a lack of workers available to get the cargo moving off the boats and through customs quickly. 

So, fewer boats in China to pick up the cargo and fewer workers to offload the boats in the US lead to long, painful lead times for flame retardant. 

It’s also important to remember that depending on what port in China you’re shipping out of, the boat will probably have to stop in multiple ports along the way to pick up other cargo. This can lengthen the journey to the US even more. 

What can you do to improve flame retardant lead times?

The sailing time to the US from China is only two weeks, but once it reaches the west coast, it will just sit offshore for about four weeks before finally being scheduled to dock. 

As soon as it’s in port, some action will start to happen, and the containers will begin to be offloaded but not at the level of speed it once was. 

How can you help improve this and make the process easier to receive your flame retardant sooner?

As a business, you can encourage more labor to be present at the ports in the US to help operate the crates and offload them quickly. 

The lack of labor is slowing down the lead time at the US ports, especially in Los Angeles. By getting people in more positions and having more hands to operate crates and offload them to the trucks, the lead time will start to reduce.

Having more labor at the docks is necessary but having truck drivers and warehouse technicians readily available to receive the products will also help reduce the lead time and get flame retardant products to businesses quicker. 

If you’re looking for flame retardants and smoke suppressants, Ocean Chemical is here to help. 

We have extensive knowledge in flame retardants and can provide your business with everything it needs to accomplish its goals. 

With over 25 years of flame retardant industry experience, we’re the right choice for all your brominated, non halogenated, and synergist flame retardant solutions. 
We are always here to see to the needs of every one of our clients. Get what you need today by getting in touch with the talented team at Ocean Chemical.

Everything You Need To Know About Bromine Production

What You Need To Know About Bromine Production – Why Has Bromine Increased In Price?

The increase in bromine prices has seriously affected the cost of flame retardants, making it difficult for companies worldwide to get the supply they need for their products. 

But why has the cost of bromine increased so much since 2020? Why have we seen such a rapid increase in the price of bromine over the past few months?

These are all questions companies like you are asking yourself as you try to order your usual order of flame retardant only to see it’s shot up in price. 

Today we’re going to show you exactly why the cost of bromine and flame retardant has increased in price and how COVID-19 has contributed to the inflated cost of bromine. 

Why are bromine prices going up?

Over the last couple of months, the price of bromine has increased a lot. This is primarily due to an increase in chlorine prices. Chlorine is a critical raw material in bromine production. The cost of chlorine has skyrocketed due to the imbalance in the chloralkali market. 

The industrial production of bromine involves a direct reaction of chlorine with brine rich in bromine ions. So chlorine is an essential part of the production of bromine and the production of flame retardant.

This process is simple, fast, and quite economical. But the price of chlorine is causing this process to cost a lot more than it initially did. 

This increase in chlorine cost makes bromine production incredibly expensive which is pushing the bromine market price to increase as demand continues to rise. 

How has COVID-19 affected bromine prices?

The outbreak of COVID-19 had a significant impact on a lot of industrial operations all around the world. 

There were: 

There were also many other restraints that made industries suffer globally. With all these significant challenges faced by the industries, bromine production was just another issue added to the already heavy pile of problems.  

During the first phase of the coronavirus outbreak, operation rates fell sharply. Some plants even had to halt bromine production for a few days completely. 

There was a massive absence of end-users during the pandemic because nobody was working on their projects, so chlorine and bromine weren’t needed. This lack of end-users significantly reduced the demand for products, especially chlorine. 

Because of the lack of demand during the coronavirus pandemic, the key players in the market reported an intense decline in revenue. Plus, the global market, for the first half of 2020, seriously dipped and lost a lot of profit. 

For example, Olin Corporation, the world’s largest producer of chlorine globally, reported a loss of 80 million USD in the first quarter of 2020 due to the massive dip in sales prices and demand volume.

In 2021, when the demand for chlorine came surging back, the industry ran into issues. They had no chlorine because they shut down the plant due to revenue decline. This created an incredible, record-breaking shortage of chlorine. 

With the demand rising rapidly, the bid price for chlorine also started to increase rapidly. This increase in chlorine prices also brought the cost of bromine production to reach record prices and, in turn, increased the price of flame retardants. 

Why has the demand for bromine increased?

Bromine is widely used in the chemical and pharmaceutical industries, and it’s also used in the pool and spa industries, especially now due to the shortage of chlorine. 

Chlorine serves multiple purposes in swimming pools as it kills germs and makes it safer to swim in the water. It keeps pool water crystal clear, but because of the shortage, many pool owners are turning to the number one alternative – bromine. 

Bromine is a sanitizing chemical that will kill algae, germs, and bacteria in pools. It works similar to chlorine and is even less irritating to your skin. 

Chlorine and bromine are chemically related and halogen elements, but they exist in different states. Chlorine is a gas at room temperature, whereas bromine is a liquid. 

Bromine is an attractive alternative to chlorine for pool owners because it doesn’t require you to purchase additional equipment. However, it is more expensive and is only going to continue to increase in price the higher the demand is. 

Because we need chlorine to make bromine, the demand for chlorine will also continue to rise, which will make flame retardants incredibly expensive to create and import. 

If you’re looking to order flame retardants and smoke suppressants, Ocean Chemical is here to help. 

We have extensive knowledge in flame retardants and can provide your business with everything it needs to accomplish its goals even during these shortages. 

With over 25 years of flame retardant industry experience, we’re the right choice for all your brominated, non-halogenated, and synergist flame retardant solutions. 
We are always here to see to the needs of every one of our clients. Get what you need today by getting in touch with the talented team at Ocean Chemical.