17 May 2010 17:32 [Source: ICIS news]
By Nigel Davis
Concern over the European recovery has deepened despite the bailout agreement for debt laden
Crude dipped lower still on Monday with NYMEX futures below $70/bbl and Brent under $76/bbl.
The world may be buoyed by a still fast growing
Trying to make money while they can, though,
If you are a buyer of polyethylene (PE) in
That may have been because you were buying on a hand-to-mouth basis, expecting the inevitable impact of new production capacities in the Middle East and
As ICIS news reported on Monday, PE inventories along the chain are still very low. And European producers have been controlling production carefully.
The industry is working in a different way. The acceleration away from the 2009 recovery in the first months of 2010 has proved very welcome but it has hardly changed attitudes.
Producers have learned to operate differently. Inventories have eased back up with increased demand but by no means is there the flexibility in the system that there once was. The tightness occurs in critical products and grades.
There is little real confidence in the recovery and the perception persists that the polyolefins business will be hit over the coming months as it moves through the negative phase of its own cycle.
New production capacities, although delayed, are coming on-stream. These low-cost units will take their place in a much changed world.
But even if many in the sector are relatively clear as to the eventual outcome, no-one can be sure of how the industry reaches the point where supply and demand is so fundamentally re-balanced.
European producers who have cut production have urged others to do so but appear now to be crying in the wind.
Some industry participants believe that the capacity-fuelled dip in 2010 and 2011 will not be worse than that in 2002 and ’03.
But that analysis is based on continued start-up delays and, critically, continued consumption growth.
The sector is as reliant as ever on the consumer in
The differences of opinion as to just where the industry is heading in the near term were widely apparent at this year’s Asia Petrochemical Industry Conference (APIC) in Mumbai.
The industry is not as fearful as it once was about plant start-ups in the
“May ethylene was stable, and we are paying increases. Oil is falling and
($1 = €0.81)
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