Maastricht, Netherlands – Peter Huntsman, the president, chairman and CEO of US-based Huntsman, is pleading with Europe to come to its senses when it comes to manufacturing, industrial policy and energy policy. “I am an enormous fan of Europe,” he told the UTECH Europe conference in Maastricht in his opening keynote address.
“I hope my message doesn’t come across as being anti-Europe, but I believe that Europe today is failing miserably from a policy point of view to come to sustainable solutions for our industry, for Europeans, and for the environment.”
Taking Germany’s industrial output as an example, he said it has been bad over the past couple of years, but that’s not just down to high energy prices after Russia’s invasion of Ukraine. “That certainly has exacerbated the situation, and has been particularly hard on Germany,” he said. “But the summer before the invasion Europe, and Germany in particular, was also going through high energy prices.”
He gave the example of Huntsman’s three MDI plants, in Rotterdam, Louisiana in the US, and Caojing, China. Back in 2019, he said, Rotterdam produced the company’s cheapest MDI. By 2020, China was becoming more competitive, and Rotterdam has now become much more expensive.
“If you look at the latter part of 2022, the arbitrage was so great, you could move product from China and the US into Europe and make hundreds of dollars per ton,” he said. “Why on earth would you be investing here for new science, new technology, new capacity? What Europe is losing today is what should be coming into the market three, four or five years from now. That’s when we see this impact and, and that’s why I think Europe needs to be acting now to attract capital and to be able to work towards a purposeful, meaningful reinvestment in this great economy.”
But, he said, there is no ready drop-in replacement for the world’s reliance on power produced from fossil fuels to meet demand and be self-sufficient. “China doesn’t have an abundance of natural gas or oil, but has an enormous supply of coal, and is building two to three coal-burning power plants on a weekly basis,” he said. “Is that coal going to be replaced any time soon by wind or solar? Of course not.”
He cited projections from the International Energy Agency that suggest that fossil power will decline steeply from this year onwards, but these are purely aspirational, he said. “We’re making manufacturing industrial policy around aspirational numbers, not reality,” he said.
Looking at CO2 emissions by industry, according to the US EPA, the chemical industry produces 3% of the US’s CO2 emissions, just below the 4% that comes from bovine flatulence. The US emits about 4.5bn tons of CO2 a year today, the same as in 1970, he said.
“It is our industry that allows transportation building industry, farm to fork and energy conservation to exist,” he said. “There is not a product in this room that would exist today without the petrochemical industry. We’ve got to have an industrial policy and an energy policy that’s going to sustain this, and it needs to happen here in Europe, as this is the industry leader. Don’t outsource your energy policy. Don’t outsource your manufacturing policy. Don’t outsource your industrial policy. Speak up, make your voices known.”
