【Overseas Highlights】SK Chemicals Forms Partnership with Omya! Covestro Completes Acquisition; Honda Shifts Focus to Energy Storage Sector

International News Digest:

Raw Material News - SK Chemicals and Omya Reach Cooperation to Expand TPEE Product Distribution Network in Europe

Policy News - EU Passes Vehicle Recycling Regulation

Automotive News - Honda Transitions to Energy Storage Sector: Electric Vehicle Batteries Repurposed for Data Centers

Macro News - Citigroup: As the impact of the Strait of Hormuz subsides, Brent crude may fall to $60 per barrel.

Price Information-The central parity rate of the renminbi against the U.S. dollar was set at 6.8047, up 41 basis points.

The following are the details of the international news:

1. SK Chemical has reached a partnership with Omya to expand the European distribution network for its TPEE products.

Formulation engineers and R&D professionals selecting thermoplastic polyester elastomers (TPEE) for applications in automotive, industrial hoses, subsea cables, and breathable films can now source SK Chemicals’ TPEE product SKYPEL through a newly expanded European distribution channel. SK Chemicals has signed a European regional sales and distribution agreement with Omya’s Functional Polymer Distribution business unit, covering the full SKYPEL product portfolio.

2. Covestro has completed the acquisition of the former Huntsman plants in Thailand and the United States.

On July 2, Covestro announced that it had completed the acquisition of two former Vencorex HDI derivatives production sites located in Rayong, Thailand, and Freeport, Texas, USA, with the transaction officially closing on July 1. This move marks a further expansion of Covestro’s global production footprint in high-performance polyurethane raw materials and reflects the company’s long-term strategic commitment to two core markets: Asia-Pacific and North America.

3. The mayor of Debrecen demands that the Enjie factory be shut down and withdrawn!

According to Telex, Enjie Hungary Co.SEMCORPAn internal investigation has been initiated regarding the pollution exceeding standards at the Debrecen factory, and it has been stated that independent experts will be invited to participate, while continuing to cooperate with relevant authorities in the investigation.

The company stated that the investigation will be conducted by the group’s international management team and asked all parties to remain patient until the technical and regulatory procedures are completed. The company’s management has also held talks on this matter with Debrecen Mayor Papp László. Previously, Papp had requested SEMCORP to leave the city and called on regulatory authorities to consider revoking the plant’s environmental permit.

Evante has launched a non-perfluoroalkyl and polyfluoroalkyl substance barrier additive that can reduce solvent permeation in high-density polyethylene.

Honda shifts to the energy storage sector: electric vehicle batteries repurposed for data centers.

Zhuanshu Shijie learned that Honda began production of batteries for energy storage systems this week, marking the Japanese automaker's official entry into the rapidly growing energy market. According to Nikkei Asia, Honda has become the latest automotive company to venture into the energy storage field.

This move comes just three months after Honda canceled its electric vehicle plans for the U.S. market. The electric vehicle batteries originally intended to be produced at the joint venture factory in Ohio with LG Energy Solution will now be sent to data centers instead of being used for vehicles.

Honda’s shift comes against the backdrop of persistently weak demand for electric vehicles in the United States. After the Republican Party eliminated tax credits intended to spur U.S. EV and battery production, EV sales have continued to decline year over year, partly because consumers rushed to buy vehicles before the incentive policy ended last September.

The EU passes vehicle recycling regulations.

Recently, the Council of the European Union formally adopted the End-of-Life Vehicles Regulation (ELVR), which sets out circularity requirements for vehicle design and rules on end-of-life vehicle management. Earlier, on June 18, the European Parliament had already approved the legislation by vote. The new regulation will replace the End-of-Life Vehicles Directive, which has been in force for 25 years, as well as the 3R type-approval directive, and will apply directly in all Member States as a single EU regulation. The new rules are intended to ensure that new vehicles are designed from the outset to facilitate reuse, recycling, and recovery, thereby driving the automotive industry toward a comprehensive transition to a circular economy and sustainable development.

Overseas Macro Markets:

Meta is reportedly considering having Samsung manufacture custom AI chips worth 10 trillion won.

According to the Seoul Economic Daily, Meta is evaluating Samsung Electronics' foundry business to design and produce next-generation custom AI chips worth over 10 trillion won. Meta is considering using Samsung's 2-nanometer process technology to manufacture its third-generation MTIA AI accelerator. It has been reported that Samsung's foundry order backlog may be affected by AI chips. and approaching 50 trillion won, could support its operating profit as early as the fourth quarter.

[Citi: As the impact of the Strait of Hormuz disruption fades, Brent crude could fall to $60 a barrel]

Citigroup believes that as the disruption to traffic through the Strait of Hormuz gradually eases, Brent crude may fall to $60 a barrel. “Fundamentals are quickly reasserting themselves,” analysts including Francesco Martoccia said in a report. “Shipping traffic is returning to normal, the spot oil market has weakened significantly, and inventory draws are far smaller than expected.” Goldman Sachs and several other banks said that as the impact of the Iran war gradually fades, traffic through the Strait of Hormuz is also beginning to recover, and the global oil market is likely to once again fall into oversupply. Morgan Stanley has cut its oil forecasts twice in recent weeks and said there is a risk of oversupply.

Canada advances West Coast crude oil pipeline project to reduce dependence on the U.S. market

On July 2, Canadian Prime Minister Mark Carney announced that the federal government has formally submitted a proposal to advance the construction of a West Coast oil pipeline project for review by the Office of Major Projects. According to a press release from the Prime Minister's Office, the project will utilize the existing Trans Mountain pipeline route to transport crude oil from Alberta to the coast of British Columbia. The project is designed to have a transportation capacity of approximately 1 million barrels per day, aiming to deliver Canadian oil to global markets and reduce dependence on the U.S. market.

Russia takes measures to stabilize domestic fuel supplies.

Russian Deputy Prime Minister Alexander Novak recently instructed relevant Russian government agencies and companies to formulate specific measures to stabilize fuel supplies in the regions facing the most severe shortages. TASS reported on the 2nd that Novak said Russia has sufficient fuel reserves to meet domestic market demand, but panic buying has led to a 20% to 30% increase in demand. Shortages at some gas stations are due to logistical adjustments in deliveries from refineries to specific oil depots and gas stations, and reconfiguring the logistics system will take time. He also said that, in order to ensure domestic supply, Russia may introduce a short-term ban on diesel exports.

Price Information:

The central parity rate of the RMB against the USD is reported at 6.8047, an increase of 41 points; the previous trading day's central parity was 6.8088, and the official closing price of the previous trading day was 6.7866, while the night session last day closed at 6.7830.

[Upstream Raw Material USD Market Price]

On July 2, CFR Northeast Asia ethylene was stable at USD 815/ton, while CFR Southeast Asia ethylene was stable at USD 790/ton.

The FOB average price of propylene in Northeast Asia is stable at $890/ton in South Korea, while the CFR average price in China is stable at $920/ton.

North Asia CIF prices for refrigerated cargoes: propane at USD 605-613/mt; butane at USD 605-613/mt.

China South China frozen cargo August landed prices: propane $651-661/ton; butane $671-681/ton.

The CIF price of frozen goods in Taiwan is propane at $605-613/ton; butane at $605-613/ton.

LLDPE USD market price

Thin film: USD 930/ton (CFR Huangpu);

[HDPE USD Market Price]

Film: USD 1,050/ton (CFR Qingdao);

Hollow: USD 1,242/ton (CFR Yantian);

Injection molding: US$1,180/ton (CFR Yantian);

[LDPE USD Market Price]

Film: USD 1,250/ton (CFR Huangpu);

[PP USD Market Price]

Homopolymer: USD 1,190/ton (CFR Huangpu);

Copolymer: USD 1,190/ton (CFR Nansha);

Membrane material: USD 1,480/ton (CFR Huangpu);

Transparent: USD 1,400/ton (CFR Huangpu);