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SABIC Has No Interest in Taking Over Clariant, Says CEO

Saudi Basic Industries Corporation (SABIC) Vice Chairman and Chief Executive Officer Yousef Abdullah al-Benyan speaks during a press conference held in the SABIC HQ in Riyadh, Saudi Arabia (File Photo: Reuters)
Saudi Basic Industries Corporation (SABIC) Vice Chairman and Chief Executive Officer Yousef Abdullah al-Benyan speaks during a press conference held in the SABIC HQ in Riyadh, Saudi Arabia (File Photo: Reuters)
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SABIC Has No Interest in Taking Over Clariant, Says CEO

Saudi Basic Industries Corporation (SABIC) Vice Chairman and Chief Executive Officer Yousef Abdullah al-Benyan speaks during a press conference held in the SABIC HQ in Riyadh, Saudi Arabia (File Photo: Reuters)
Saudi Basic Industries Corporation (SABIC) Vice Chairman and Chief Executive Officer Yousef Abdullah al-Benyan speaks during a press conference held in the SABIC HQ in Riyadh, Saudi Arabia (File Photo: Reuters)

Saudi Basic Industries Corporation has no interest in taking over Swiss chemicals firm Clariant AG after halting talks last week on their high-performance plastics venture, announced SABIC Vice Chairman and CEO Yousef al-Benyan.

Speaking at a press conference at the company’s headquarters in Riyadh, Benyan said that Saudi Aramco is in the process of purchasing a 70 percent stake in the company.

He indicated that the deal is expected to be completed by the end of 2019 or during Q1 of 2020.

Benyan explained that upon completing the measures required for Aramco to obtain the necessary approvals to complete the process, there will be joint work between SABIC and Aramco to identify and chart the course of the petrochemical industry in Saudi Arabia.

Both companies will also work hard to achieve the 2025 strategy, which SABIC is working to establish.

The CEO addressed tensions and trade disputes between the United States, China and other global markets this year, saying they have affected SABIC's performance and profits.

He then announced that SABIC has no interest in taking over Clariant and describing its 25 percent stake in the company as “a long term strategic investment.” 

“We have no interest in a full takeover, if that’s your question, but we have interest to grow our share and make sure that we can bring positive growth and retain investment for SABIC and Clariant shareholders,” responded Benyan to a reporter’s question.

The slowdown in global GDP growth coincides with a decline in petrochemical prices due to a significant increase in new supply capacity resulting in lower product prices and margins in key product lines, according to Benyan.

He admitted that lower petrochemical prices have negatively impacted SABIC’s Q2 results, even though the company’s operational performance remains robust.

“SABIC remains optimistic on industry fundamentals over the long term and we continue to invest for growth. We recently received all the regulatory approvals to increase our stake in Ar-Razi, the world’s largest methanol complex, to 75 percent and renewed our partnerships with Japan Saudi Arabia Methanol Company (JSMC) for a further 20 years.”

The CEO announced that SABIC has obtained all approvals to establish a petrochemical joint venture project with ExxonMobil in the US Gulf Coast.

SABIC also signed a Memorandum of Understanding (MoU) to scope a new solar PV-based power plant in Yanbu Industrial city that could have a potential capacity between 200 to 400 Mega Watt. This project would be the Kingdom's first large scale renewable energy project built for and by the private sector.

Benyan explained that this initiative goes in tandem with SABIC’s wider sustainability efforts and in June the company launched its Sustainability Roadmap aligned to the United Nations Sustainable Development Goals (SDGs).

This plan outlines SABIC’s ambitious targets relating to resource efficiency, climate change, the circular economy, food security, sustainable infrastructure, and preservation of the environment. 

SABIC Q2 profit plunged to the lowest level since 2009 as demand for chemicals and plastics declined. Its shares dropped as much as 3.8 percent in Riyadh. 

The company's net income, after Zakat and tax, dropped to $565 million by June 30, compared to $909.3 million during the same period of 2018, based on the company’s report distributed during the press conference.

The report noted that the increase in global production of basic products, which negatively affected product prices and profit margins in the first half of 2019, is expected to continue to affect the company's profits during the second half as well.

According to the report, total sales in the second quarter amounted to $9.5 billion, down 17.12 percent from the same quarter last year and a decrease of 4 percent compared to the previous quarter.

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United States Eases Port Fees on China-Built Ships after Industry Backlash

Ships are seen under construction at the Jinling Shipyard in Nanjing, in China's eastern Jiangsu province on April 14, 2025. (AFP)
Ships are seen under construction at the Jinling Shipyard in Nanjing, in China's eastern Jiangsu province on April 14, 2025. (AFP)
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United States Eases Port Fees on China-Built Ships after Industry Backlash

Ships are seen under construction at the Jinling Shipyard in Nanjing, in China's eastern Jiangsu province on April 14, 2025. (AFP)
Ships are seen under construction at the Jinling Shipyard in Nanjing, in China's eastern Jiangsu province on April 14, 2025. (AFP)

The Trump administration shielded on Thursday domestic exporters and vessel owners servicing the Great Lakes, the Caribbean and US territories from port fees to be levied on China-built vessels, aiming to revive US shipbuilding.

The Federal Register notice posted by the US Trade Representative was watered down from a February proposal for fees on China-built ships of up to $1.5 million per port call that sent a chill through the global shipping industry.

Ocean shipping transports about 80% of global trade - from food and furniture to cement and coal. Industry executives feared virtually every cargo carrier could face steep, stacking fees that would make US export prices unattractive and foist annual import costs of $30 billion on American consumers.

"Ships and shipping are vital to American economic security and the free flow of commerce," US Trade Representative Jamieson Greer said in a statement. "The Trump administration's actions will begin to reverse Chinese dominance, address threats to the US supply chain, and send a demand signal for US-built ships."

Still, the fees on Chinese-built ships add another irritant to swiftly rising trade tensions between the world's two largest economies as President Donald Trump seeks to draw China into talks on his new tariffs of 145% on many of its goods.

The revisions tackle major concerns voiced in a tsunami of opposition from the global maritime industry, including domestic port and vessel operators as well as US shippers of everything from coal and corn to bananas and cement.

They grant some requested carve-outs, while phasing in fees that reflect the fact US shipbuilders, which turn out about five vessels annually, will need years to compete with China's output of more than 1,700 a year.

The USTR exempted ships that ferry goods between domestic ports as well as from those ports to Caribbean islands and US territories. Both American and Canadian vessels that call at Great Lakes ports have also won a reprieve.

As a result, companies such as US-based carriers Matson and Seaboard Marine would dodge the fees. Also exempt are empty ships arriving at US ports to load up with exports such as wheat and soybeans.

Foreign roll-on/roll-off auto carriers, known as ro-ros, are eligible for refunds of fees if they order or take delivery of a US-built vessel of equivalent capacity in the next three years.

The USTR set a long timeline for liquefied natural gas (LNG) carriers. They are required to move 1% of US LNG exports on US-built, operated and flagged vessels within four years. That percentage would rise to 4% by 2035 and to 15% by 2047.

The agency, which will implement the levies in 180 days, also declined to impose fees based on the percentage of Chinese-built ships in a fleet or on prospective orders of Chinese ships, as originally proposed.

The fees will be applied once each voyage on affected ships a maximum of six times a year.

Executives of global container ship operators, such as MSC and Maersk, which visit multiple ports during each sailing to the United States, had warned the fees would quickly pile up.

Instead of a flat individual fee on large vessels, the USTR instead opted to levy fees based on net tonnage or each container unloaded, as was called for by operators of small ships and transporters of heavy commodities such as iron ore.

From October 14, Chinese-built and owned ships will be charged $50 a net ton, a rate that will increase by $30 a year over the next three years.

That will apply if the fee is higher than an alternative calculation method that charges $120 for each container discharged, rising to $250 after three years.

Chinese-built ships owned by non-Chinese firms will be charged $18 a net ton, with annual fee increases of $5 over the same period.

It was not immediately clear how high the maximum fees would run for large container vessels, but the new rules give non-Chinese shipping companies a clear edge over operators such as China's COSCO.

The notice comes on the one-year anniversary of the launch of the USTR's investigation into China's maritime activities.

In January, the agency concluded that China uses unfair policies and practices to dominate global shipping.

The actions by both the Biden and Trump administrations reflect rare bipartisan consensus on the need to revive US shipbuilding and strengthen naval readiness.

Leaders of the United Steelworkers and the International Association of Machinists and Aerospace Workers, two of five unions that called for the investigation that led to Thursday's announcement, applauded the plan and said they were ready to work with the USTR and Congress to reinvigorate domestic shipbuilding and create high-quality jobs.

The American Apparel & Footwear Association reiterated its opposition, saying port fees and proposed tariffs equipment will reduce trade and lead to higher prices for shoppers.

At a May 19 hearing, the USTR will discuss proposed tariffs on ship-to-shore cranes, chassis that carry containers and chassis parts. China dominates the manufacture of port cranes, which the USTR plans to hit with a tariff of 100%.

The Federal Register did not say if the funds raised by the fees and proposed crane and container tariffs would be dedicated to fund a revival of US shipbuilding.