Chemical Chaos: Tariffs, Tanks, and Trade Tantrums
The United States is the world’s largest importer of chemicals, importing $324 billion worth of chemicals in 2023. The recent announcement to impose a 25% tariff on imports from Canada and Mexico and an additional 10% on goods from China will certainly alter the existing U.S. trade policy, particularly in the specialty chemical arena which have had long term efficient supply chains embedded in their processing and distribution channels. The cherry on top could be reciprocal tariffs which are also being bandied about. Of course, bright minds are always resilient – and there’s no doubt that heads are scratching in an effort to figure out the next best way of doing things while reacting to some of the unintended consequences of these tariffs. Having storage at the right place can be key to alleviating some of these potential disruptions. Have no fear! The Tank Tiger is here. We’re sitting on dozens of tanks that are potentially suitable as new supply chains are carved out. Turn us loose!
Getting a whiff of these tariffs influenced the stock market into making a face like somebody farted and left the room. The S&P 500 dropped 1% and the NAZZY dipped 3.5% last week due to this uncertainty. On the energy side, long-term charter deals for oil tankers are becoming less interesting as oil traders are reluctant to lock these in due to all of the geopolitical uncertainty. Meanwhile, US crude production set a new annual and monthly record. All of this oil certainly has to go somewhere, and storage tanks are always an excellent solution. WTI prices ended the week at $69.76, which was 64 cents lower than last Friday’s close. US ethanol inventories in the Midwest are at an all-time high while USGC ethanol inventories are at a 5 year high. On the other hand, global biodiesel production appears to be decreasing as feedstock costs go up. Pending changes and uncertainty at the EPA are definitely affecting the biofuels industry. It’s a good thing that eggs are not a renewable feedstock. Like they say, one man’s meat is another man’s poison so if someone is feeling froggy, just leap.
It was great seeing everyone in San Antonio over the last few days. Indeed, it’s a constant reminder that seeing our business partners in person is an irreplaceable mode of doing business and it can actually be fun. Business calories don’t count. We’re looking forward to seeing everyone in Houston as The Tank Tiger celebrates its 10 year anniversary later this month. If you have not yet received your invitation, let us know.
