FocusChina's strong petchem imports to subside in 2010 - analysts

27 November 2009 05:53  [Source: ICIS news]

By Judith Wang and Dolly Wu

SHANGHAI(ICIS news)--China's petrochemical imports should post a "reasonable" growth next year, more subdued than what it has been so far this year, as the effects of the government's fiscal stimulus package will likely start to wear off, industry analysts said on Friday.

Based on latest data from China Customs, toluene imports had the biggest year-on-year surge in October among petrochemical products, rising 713% to 37,744 tonnes.

China's methanol imports, meanwhile, surged 142% to 170,240 tonnes last month. Butadiene imports jumped 82% to 7,389 tonnes, while it took in 314,586 tonnes of styrene monomer (SM), representing an annual increase of 64%, based on official trade statistics.

“The strong growth will extend to the end of this year, but it will likely slow and remain at reasonable levels next year on some macro[economic] factors," said Nanjing-based Huatai Securities analyst  Xiong Jie, citing the possible tightening of monetary policy and the cessation of government incentive measures as the Chinese economy recovers.

As the leading importer of petrochemicals in Asia, China has been instrumental in the recovery of product prices this year following severe weakness in 2008.

The strong growth in volumes of imported polyolefins, phenol and acetone, particularly going into the fourth quarter of this year, was a reflection of the low base in 2008 at the height of the global economic and financial turmoil, said Xiong of Huatai Securities.

Petrochemical product prices in Asia have remained below pre-crisis levels despite some recovery this year and the low prices may have also spurred the strong demand from China, analysts said.

“I think low import price is the key reason that boosted imports plus the fact that China is shifting its economic growth from  investments and exports towards domestic consumption,” Li Guangzan, an analyst from Hangzhou-based Founder Securities said.

The ongoing industrialization of China's huge economy - currently the third biggest in the world - fuels its massive need for imported crude and makes the country the second largest carbon dioxide (CO2) emitter globally.

On Thursday, China revealed its plans to do its share in the global efforts to advance clean energy. Its State Council has committed to reduce the intensity of the country's CO2 emissions per unit of GDP in 2020 by 40-45% compared with 2005 levels.

China also reiterated its goal to supply 15% of primary fuel consumption with non-fossil fuels by 2020.

“The goal provides a challenge to China’s energy consumption structure. In the future, the natural gas consumption will definitely rise given that it is more environmental compared with crude and coal,” said Li of Founder Securities. 

Oct-09	Import			Export
Product	Import (tonnes)	YoY growth (%)	MoM growth (%)	Export (tonnes)	YoY growth (%)	MoM growth (%)
Naphtha	327,674	762%	-9%	59,511	1%	-51%
Olefins
Product
Ethylene	64,157	0%	-22%	4,382	219000%	23%
Propylene	109,586	18%	-10%	0	-100%	-100%
Butadiene	7,389	82%	-62%	9,841	-25%	408%
Polymers
Product
HDPE	240,211	65%	-35%	1,664	-50%	1%
LDPE	83,854	71%	-15%	2,104	78%	-35%
LLDPE	172,880	63%	0%	282	-25%	-46%
PP	278,867	26%	-27%	4,434	18%	-10%
PVC	84,109	33%	-20%	36,449	9%	-40%
PS	6,154	-25%	-22%	23,255	23%	-17%
Aromatics
Product
Benzene	17,035	-2%	190%	51,893	261%	55%
Toluene	37,744	713%	-49%	451	242%	84%
MX	19	-58%	-100%	28	2700%	-7%
PX	249,214	-4%	-26%	35,201	3%	-37%
Intermediates
Product
SM	314,586	64%	-13%	0.2	-33%	-99%
PTA	398,322	6%	-18%	0	0	0
MEG	414,281	0%	-25%	158	-95%	-93%
ACN	25,888	30%	-28%	0	0	0
Caprolactam	36,109	59%	-35%	500	41%	-1%
Phenol	32,311	47%	-35%	3,401	24193%	3901%
Others
Product
Methanol	170,240	142%	-45%	3,383	12%	1%
Acetone	25,408	28%	-55%	16	-33%	60%
BPA	25,557	-11%	-51%	816	649%	157%
IPA	5,148	-30%	-26%	46	-61%	-48%
MEK	1,216	-51%	-69%	1,154	4516%	-86%
Base oil	120,547	14%	-29%	4,685	0%	-2%
MMA	10,727	80%	-34%	772	-74%	7%
PMMA	14,548	16%	-30%	626	-10%	-24%

Source: China Customs

To discuss issues facing the chemical industry go to ICIS connect

By: Judith Wang
+65 6780 4359

< previous article(VIDEO - ICIS news Europe Lunchtime Bulletin 18 January 2010)

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly