Chemical Sector's Response to the Crisis While Facing Its Own Challenges

ICIS President and CEO Dean Curtis writes about the chemical industry's commendable efforts and assistance, particularly to healthcare workers and civil servants, despite being in crisis itself. We share Dean Curtis's article below: "We often forget how vital the chemical industry is to our prosperity, safety and daily lives. The social stigma attached to it because of the plastic waste problem generally overshadows the progress this sector has made in becoming one of the more sustainable producers of critical industrial products. In recent months, when faced with a global health crisis, it has never been clearer how important and responsive this industry is. As the world reeled from the effects of coronavirus, the chemical industry stepped in with remarkable speed and agility to help healthcare authorities fighting the virus gain access to the materials they needed in the frontline battle to save our lives. To manufacture antibacterial wipes, hand sanitizers, disinfectants, surfactants for soaps and personal protective equipment such as masks, aprons and face shields, vital materials must be procured from chemical suppliers. The chemical industry helps control the spread of the virus by strongly supporting the supply of such products. In addition to a major production surge towards isopropyl alcohol (IPA) and ethanol used in hand sanitizer production, many chemical companies have taken action to directly meet the large increase in demand for the final hand sanitizer product. INEOS built two new facilities in the UK and Germany in just 10 days, which are now being distributed free of charge to health authorities for hand sanitizer production. In the US, two more such facilities were built in Arkansas and Pennsylvania in less than 10 days.

INEOS facilities in Grangemouth, Scotland, Moers and Herne in Germany and Lavéra in southern France have the capacity to produce the IPA and ethanol needed to support the new facilities.

Dow announced four additional global facilities, including its existing facility in Germany, bringing expected production for disinfectant production above 200 metric tons. This disinfectant will also be free to health authorities. Dow also designed lightweight and simplified face shields and is producing 100,000 of them for donation to hospitals in Michigan, USA. Like all humanity, our sector has many examples of coming together, taking action and supporting our fight against Covid-19. Industry has played and will continue to play an important role in preventing and recovering from this crisis. ExxonMobil, Oleon, MOL, Shell, Cropenergies, Huntsman, LyondellBasell, BASF, Arkema, Perstorp, Indorama, PTT Global Chemical, SABIC, Unica, VCI and others have made a major global effort to support the fight against the virus. The response from the chemical industry to this global crisis is not surprising. The industry has long made a major contribution to global GDP and pioneered human history. Innovation continues to evolve to improve and save lives and enable critical technologies. Chemicals have helped produce low and zero-fat foods, made water safe, provided higher crop yields, enabled more efficient aircraft, created new materials that are stronger, lighter and safer for electric vehicles. Indeed, nearly every industry relies on chemicals for some part of its production processes. The sector's work today has focused on supporting growth and addressing sustainability issues.

On 19 March, the US Department of Homeland Security (DHS) designated the chemical industry and its workers as "Essential Critical Infrastructure" – a critical sector for public health and safety, economic and national security.

While implementing CDC (Centers for Disease Control and Prevention) workforce and customer protection guidance, DHS noted to the chemical industry: "Continuing your work programme is a special responsibility." As industry continues to increase production capacity in response to Covid-19, it is doing so in a market environment where chemical prices have fallen due to the virus. In April, the ICIS Petrochemical Index (IPEX) recorded an 18% decline globally compared to March and a 37% annual decline. The second quarter is expected to show the worst financial performance in the sector as demand collapsed during lockdown periods. In addition to cleaning and sanitation products, polyethylene (PE) for food packaging and polypropylene (PP) for PPE are critical in disease prevention. Despite their critical importance for Covid-19, demand and pricing for these materials have also declined due to weakness in automotive, construction and durable consumer goods. However, the chemical industry, which springs from innovation and is vital to modern society, will remain strong. The effects of the coronavirus pandemic will certainly reverberate across many industries and supply chains and will provide opportunities to learn and likely change the way we work in the future. Under the pressures brought by a crisis, organizations will need to find better and new ways of doing previous work, adapt to a new normal with the conditions and opportunities it brings, and release the creativity to do so. The chemical sector, which is already moving towards digitalization and analytics to become more efficient and robust, has now proven through this intervention shown to the whole world its resilience, purpose, agility and commitment to protecting the future."