Braskem Explores Potential Entry into the Sustainable Aviation Fuel Market

Braskem, a leading player in the petrochemical industry, is exploring opportunities to enter the Sustainable Aviation Fuel (SAF) market, signaling its commitment to expanding its product offerings and adopting more sustainable technologies. The company is actively evaluating potential investment options, with a promising SAF project under consideration in southern Brazil, according to the several news agencies. This move is part of Braskem's broader strategy to diversify its portfolio and capitalize on the growing demand for sustainable fuel alternatives within the aviation sector.

In addition to its foray into SAF, Braskem is pursuing multiple growth initiatives aimed at strengthening its position in the petrochemical market. The company has reopened talks with Petrobras to secure natural gas supplies for the potential expansion of its Rio de Janeiro petrochemical complex. If finalized, this expansion could significantly increase Braskem's polyethylene production capacity, which currently stands at 540,000 tons per year. By ramping up polyethylene production, Braskem seeks to enhance its output to meet the growing market demands, particularly in packaging and other industries reliant on this versatile plastic.

At the same time, Braskem is responding to domestic market needs by planning to increase its production of polyvinyl chloride (PVC) in the states of Alagoas and Bahia. This decision comes in response to the rising demand driven by Brazil's new sanitation regulatory framework, which is expected to spur greater consumption of PVC for infrastructure development. Braskem anticipates completing this capacity expansion within the next 18 months, further bolstering its presence in the Brazilian market.

Despite these growth ambitions, Braskem faces several challenges. From January to September, the company experienced significant cash consumption, totaling R$ 758 million ($133 million). However, Braskem remains optimistic, forecasting a gradual improvement in the petrochemical cycle and expecting to achieve positive recurring cash generation by 2025. The company’s long-term outlook reflects confidence in its strategies and the eventual recovery of the petrochemical sector.

In a move to protect the domestic industry and stimulate further investments, Braskem has formally requested the Brazilian government to review anti-dumping tariffs on imported PVC and polyethylene. The aim of these measures is to enhance the competitiveness of Brazil’s petrochemical sector and create a more favorable environment for local manufacturers.

Through these diverse initiatives, including the pursuit of sustainable fuels, capacity expansions, and strategic investments, Braskem demonstrates a proactive and adaptive approach to growth in a rapidly changing petrochemical landscape. Its efforts to balance sustainability with market expansion reflect its ongoing commitment to innovation and leadership within the industry.