China petchem output in Dec falls amid weak demand

23 January 2009 08:48  [Source: ICIS news]

SHANGHAI (ICIS news)--China’s petrochemical output declined in December 2008 from a year ago amid overall market weakness due to the global economic slump, based on data released by China Petroleum and Chemical Industry Association (CPCIA) on Friday.

There was a marked decline in production across all product segments last year from 2007 as domestic demand for petrochemicals substantially weakened, market sources said.

Benzene output in December fell 38.3% on year to 266,000tonnes. A total of 4.034m tonnes of benzene was produced in 2008, down 3.2% from 2007.

"Downstream demand was weak since early 2008 amid soft global economic and the situation hasn’t recovered at all even by now," said a benzene trader, adding that major domestic benzene producers maintained low operating rates during the year, particularly in December 2008.

Panjin Ethylene, a subsidiary of Liaoning Huajin Chemicals, has not restarted its 60,000tonne/year benzene plant after it was shut on 10 December 2008, said a company source.

Other benzene producers such as Zhenhai Refining, Dalian Petrochemical and Lanzhou Petrochemical were running their plants at just half their capacities since December 2008, said the company sources.

Butadiene rubber (BR) output also saw a 28% decline year-on-year in December.

"There is no expansion capacity in the whole BR sector in China in 2008, coupled with low production rate amid very weak demand," said a major BR producer that supplies to the domestic market.

The chemical industry downturn may continue, with some improvement only possible in the second quarter of this year, said Qian Bozhang, an analyst from CPCIA.

Products

Dec-08

Jan-Dec 2008

Output (‘000

tonnes)

% change*

Output (‘000 tonnes)

% change*

Inorganic chemicals

Sulphuric acid

4,291

-4.2

51,101

-4.3

Nitric acid

127

-22.7

1,838

-6.0

Hydrochloric acid

566

-22.0

7,571

0.7

Caustic soda

1,321

-22.2

18,521

1.4

Calcium carbide

714

-46.0

13,608

-7.8

Organic chemicals

Ethylene

721

-19.0

10,256

-2.1

Benzene

266

-38.3

4,034

-3.2

Methanol

720

-23.1

11,263

6.4

Glacial acetic acid

115

-31.6

1,713

4.8

Synthetic material

Synthetic resin and co-polymer

2,381

-14.1

31,296

1.5

   PVC

602

-30.2

8,817

-5.3

   PE

562

-2.2

6,895

0.5

   PP

597

-2.9

7,332

3.5

Butadiene rubber

29

-28.0

419

-4.4

Caprolactam

9

-65.5

29

-4.0

Polyester

953

0.2

10,583

0.1

Chemical fibre

2,223

1.9

24,046

2.3

Fertilizer

4,672

-8.4

58,676

1.4

Plastic product

3,257

-0.6

37,138

10.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Source: CPCIA

 

Cissy Hu, Sandra Shen and Amber Liu from CBI contributed to this article

To discuss issues facing the chemical industry go to ICIS connect


By: Dolly Wu
+65 6780 4359



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