China petchems move up on prosperity index in second quarter

23 July 2009 09:44  [Source: ICIS news]

GUANGZHOU (ICIS news)--China’s petroleum and chemical industries have become more prosperous in the second quarter, an official research paper said on Thursday.

The prosperity index for the oil and gas-exploration industry increased 17 points from the first quarter to 153.5 points in the second quarter, while the chemical industry rose 13.3 points to 99.4 points.

The figures were published in a joint report by the China Economic Monitoring and Analysis Center, an arm of the National Bureau of Statistics, and the China Industry Prosperity Index Research Center.

The production index for the petroleum sector gained 1.43 points in the second quarter to 99.02 points, while the chemical sector rose 0.59 points to 99.22 points, the report said.

Total profits for the petroleum sector increased 73.3% quarter on quarter to yuan (CNY) 71bn ($10.4bn), while the chemical sector went up more than twofold to CNY47bn, according to the report.

Around 22.1% of China’s petroleum companies had losses in the second quarter, down by 4.5 percentage points from the first quarter, the report said.

Almost 20.6% of the companies in the chemical sector reported losses in the second quarter, down 3.8 percentage points from the first quarter, it said.

Overall, the data showed that the petroleum and chemical industries were on an uphill trend, and performance in the second half of the year would be even better, industry analysts said.

“With further implementation of stimulus plans like tariff breaks on exports, the industries would see higher profitability and growth,” said an analyst from the China Petroleum and Chemical Industry Association (CPCIA).

A recovery in the global economy would help boost demand and China’s chemical exports, said the analyst.

China’s chemical industry is in excess capacity, so exports improvement is key [to] expanding demand,” he said.

China’s exports of chemicals in the second quarter totalled $12.74bn, down 32.2% year on year and 1.5% less than the previous quarter, according to the report.

($1 = CNY6.83)

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By: Fanny Zhang
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