Kronos swings to loss on tariff uncertainty

Kronos Worldwide Inc. (Dallas) reported a second-quarter net loss of $9 million, swinging from net income of $19.5 million in the year-ago period on lower production volumes and lower absorption of fixed production costs, as per Chemweek.

The company said titanium dioxide (TiO2) prices have remained “relatively” stable; however, lower demand and minimal order lead times in the marketplace have pressured prices downward.

Sales totaled $494 million, down 1% year over year. Sales volume was even year over year as pricing fell 1%, Kronos said. Earnings per share came to an 8-cent loss, below the analysts’ consensus estimate of a 14-cent gain, as compiled by S&P Capital IQ.

“The first six months of 2025 have seen unprecedented global uncertainty related to US trade policies and geopolitical tensions,” the company said in its 10-Q filing. “Our customers have been hesitant to build inventories, given these uncertainties, which has prolonged the market downturn and which has impacted our sales volumes and pricing momentum. We had higher overall sales volumes in our European and North American markets somewhat offset by lower sales volumes in our export markets in the first six months of 2025 compared to the first six months of 2024.”

Sales in Europe increased 2% year over year, to $227 million. Sales in North America increased 3%, to $188 million.

Kronos highlighted the uncertainty surrounding the impact of tariffs on the demand outlook for 2025. “Our raw material, energy and other input costs continue to trend lower, and we expect this moderation to continue in the second half of 2025. We expect these cost improvements to be reflected in operating results in the third and fourth quarters of 2025 as the lower-cost inventory produced works its way through cost of sales. However, due to the weaker than expected demand, increasing pricing pressures, and lower fixed cost absorption as a result of reduced operating rates, we expect to report lower operating results for the full year of 2025 as compared to 2024.”

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The European Chemical Industry Council (Cefic) and the American Chemistry Council (ACC) have warned that tariffs above the Chemical Tariff Harmonization Agreement (CTHA) rates risk disrupting the closely integrated transatlantic industry, as per Chemweek.

The CTHA is a strong foundation to address and reduce tariff disparities on chemicals between the two jurisdictions, said ACC’s President and CEO Chris Jahn and Cefic’s Director General Marco Mensink in a joint statement Aug.4. The US and the EU are both original signatories to the CTHA.

They added that they are “encouraged” the July 27 announcement of the understanding reached between the US and the EU avoids measures that could have significantly affected the deeply integrated transatlantic trade and investment relationships in the chemicals sector.

“We are hopeful that this understanding is a step toward further discussions to strengthen our economic and trade relationship, and we encourage both sides to work with our industry to incorporate a binding sectoral agreement on chemical products as a major deliverable of these discussions,” Jahn and Mensink said.

Such an agreement would benefit both sides by increasing bilateral market access for our respective exports and ensuring a level playing field. It would also enhance regulatory cooperation and simplification and support new value chains including mechanical and advanced/chemical recycling, waste management, biomaterials, and carbon capture and utilization solutions, they noted.

“A deeper bilateral commitment for our sector would help secure domestic and resilient manufacturing of chemicals necessary to support innovation and further downstream manufacturing, stimulate R&D, and incentivize tariff agreements with other trading partner countries,” according to Jahn and Mensink.

The chemical industries of the EU and the US have strong and longstanding ties in terms of investment, complementary production chains, research and development, and trade flows. Most EU-US chemicals trade is made up of intracompany and intercompany transfers that sustain jobs on both sides of the Atlantic, they said.

ACC and Cefic said they will provide more detailed comments about the US-EU understanding when further details are confirmed by both sides.

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Despite bearish energy values, ethylene prices remained stable in Asia on Monday, as per Polymerupdate.

An industry source in Asia, on condition of anonymity, informed a Polymerupdate team member, "Prices in the Asian market remained stable due to low trading volumes, with traders exercising caution and generally remaining inactive, even as naphtha prices fell."

On Monday, CFR North East Asia ethylene prices were assessed at the USD 815-825/mt levels, unchanged from Friday's assessed levels.

CFR South East Asia ethylene prices on Monday were assessed at the USD 825-835/mt levels, rolled over from Friday.

In plant news, Shanghai Secco Petrochemical has restarted its Linear low density polyethylene (LLDPE) unit on July 22, 2025 following a turnaround and is currently running the unit at optimum levels. The unit was shut for maintenance on July 3, 2025. Located in Zhejiang, China, the LLDPE unit has a production capacity of 300,000 mt/year.

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Russia plans to increase exports from its western ports to nearly 2 MMbpd in August, about 200,000 bpd more than a previous estimate, after two refineries cut runs following Ukrainian drone attacks, two industry sources said, as per Hydrocarbonprocessing.

The extra oil has the potential to add to downward pressure to the global oil market as supplies are already set to be increased by an output hike agreed on Sunday by OPEC+, the Organization of the Petroleum Exporting Countries and allies, including Russia.

The Ryazan (learn more) and Novokuibyshevsk (learn more) refineries, both operated by Rosneft, halted operations on several crude distillation units following the drone strikes late last Saturday. Repairs will take about a month, the sources said. They spoke on condition of anonymity because they were not authorized to speak to the press. Rosneft did not immediately respond to requests for comment.

The increase from the previously planned 1.77 MMbpd will require the addition of up to 10 Aframax tankers, which can carry 80,000 tonnes–100,000 tonnes each, to the loading plan, the sources said and calculations showed.

It coincides with pressure from Washington on India, the biggest buyer of Russian seaborne oil and its Urals grade, to curb purchases. Indian state refiners have already cut Russian oil purchases and increased buying of alternative oil grades in recent weeks.

U.S. envoy Steve Witkoff arrived in Moscow on Wednesday to push for a peace deal in Ukraine ahead of a deadline set by U.S. President Donald Trump, who has threatened new sanctions unless an agreement is reached.

Ryazan processed 262,000 bpd in 2024, accounting for nearly 5% of Russia’s total refining throughput. Novokuibyshevsk processed 115,000 bpd in 2024.

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Russia has shipped its first naphtha cargo to Vietnam, as it looks for new buyers to support sales hit by Western sanctions, data from traders and shipbrokers showed, as per Hydrocarbonprocessing.

According to LSEG and Vortexa shipping data, the Malta-flagged tanker Northernlight loaded around 60,000 tonnes of naphtha in the Russian Baltic port of Vysotsk on June 23 and delivered its cargo at Vietnam's Khanh Hoa terminal. State-owned Petrolimex did not respond to a request to comment.

The tanker discharged up to 27,000 tons of naphtha at Khanh Hoa, one of the sources said, adding that the terminal mostly consists of bonded storage tanks.

According to LSEG and Vortexa data, after the Vietnam stop the Northernlight is heading to Chinese port of Dalian to discharge the rest of its cargo.

Since the European Union's full embargo on Russian oil products went into effect in February 2023, countries in the Middle East and Asia have become the main destinations for Russia's naphtha supplies.

Naphtha is a primary feedstock in the petrochemical industry for producing olefins and aromatics, which are then used to manufacture a wide array of products, including plastics, synthetics and various other chemicals, and also used for gasoline blending.

Russia doesn’t supply oil to Vietnam, despite active cooperation in the oil industry between state companies. The only test supply was back in 2015, when a cargo of ESPO was shipped to Dung Quat refinery.

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