Issue 2, 2022 - Global Chemicals Quick Facts

U.
S.
lithium producers are increasingly interested in developing lithium projects locally

Lithium, a raw material for the manufacture of batteries for electric vehicles, is currently in strong demand, and U.
S
.
companies are increasingly interested in mining lithium locally.
Because lithium production costs in South America are low, most of the lithium currently needed in the United States comes from South America
.
But some U.
S.
automakers want to tap into domestic resources to protect their battery supply chains
.
In July 2021, GM invested in Controlled Thermal Resources' lithium project
in Salton Sea, California.
Currently, Albemarle is the only company
in the United States that produces basic lithium chemicals.
The specialty chemicals manufacturer plans to double
its mining capacity in Silver Peak, Nevada, by 2025.
In December 2021, Standard Lithium raised $100 million from the Koch Strategic Platform to continue a project
for direct lithium extraction in southwest Arkansas.
The project extracts lithium directly through chemical methods, rather than using evaporation ponds, which extract lithium from the brine
.

The growth rate of global chemical production will slow

Chemical companies face a weak global economic outlook in 2022 and will also face still difficult supply chain issues
.
The global economy recovered quickly in 2021 from the restrictions imposed on the novel coronavirus pandemic in 2020, but the German Chemical Industry Association (VCI) noted that the prospects for a stronger global economic recovery have been "greatly bleak
" 。 VCI forecasts that global chemical production growth will slow significantly from 9.
5% in 2021 to 2.
7% in 2022, of which EU chemical production growth will slow from 10% to 5%, Germany will slow from 4.
5% to 2%, Russia will slow from 6.
5% to 3%, the United States will slow from 5% to 3.
5%, Brazil will slow from 1.
5% to 0.
5%, Japan will slow from 3% to 2.
5%, South Korea will slow from 6.
5% to 2.
5%, and India will slow from 6.
5%.
It will slow to 3.
5% and China will slow to 2.
5% from 12.
5%.

U.
S.
chemical investment will rebound

According to the latest Chemical Industry Situation and Outlook at the End of 2021 report released by the American Chemistry Council (ACC), US chemical investment rebounded
strongly in 2021 as investment recovered after the new crown pneumonia epidemic.
U.
S.
chemical investment is expected to rebound 14 percent to $31.
2 billion
in 2021.
According to the ACC, U.
S.
chemical investment fell 17 percent in 2020 as companies took money-saving measures during pandemic-related downturns and delayed or extended projects
.
From 2011 to 2019, the average annual investment growth rate of the US chemical industry was 11%.

After 10 years of relatively high investment growth in the U.
S.
chemical industry, investment growth in shale gas dominant capacity is slowing
.
It is expected that the average annual investment growth rate of the US chemical industry from 2022 to 2025 will be 3.
7%.

By 2025, U.
S.
chemical investment will exceed $36 billion, most of which will be spent on petrochemical, organic intermediates and plastic resin projects, and decarbonization and advanced recycling technologies will account for an increasing share
of investment budgets, according to ACC.

Indonesia will launch 22 new petrochemical projects by 2025

According to GlobalData, a leading data and analytics firm, Indonesia is likely to launch 22 petrochemical projects between 2021 and 2025, of which methanol will account for four and polypropylene for three
, driven by strong demand for plastics and fertilizers.
GlobalData pointed out that among the upcoming methanol projects in Indonesia, the Air Products Bengalon methanol plant project leads with a capacity of 2 million tons per year
.
The project is expected to start operations
in 2025.
Among the upcoming polypropylene projects in Indonesia, PT Trans Pacific Petrochemical Indotama Tuban polypropylene project and Lotte Chemical Co.
, Ltd
.
Ciligon polypropylene project lead with 600,000 tons/year each.
PT Trans Pacific Petrochemical Indotaama Tuban polypropylene plant is expected to begin operations in 2024, while Rakuten Chemical Cilegon polypropylene plant will begin operations
in 2025.