UpdateChina’s April petchem imports fall on weak demand

28 May 2010 09:33  [Source: ICIS news]

(Updates with import export data table)

By Judith Wang

SHANGHAI (ICIS news)--China’s petrochemical imports in April fell across the board on the back of weak demand, ample domestic supply and higher prices of imported materials, industry sources said on Friday.

“Looking at the figures for last month, we can conclude that China’s domestic consumption is not as strong as we expected,” Wang Huiqin, an analyst from Shanghai-based TX Investment Consulting Co said.

“Furthermore, new capacity additions, like the start-up of SABIC-Tianjin petrochemical complex, also eased the 'hungry demand' for these commodities from the world’s third-largest economy,” she added.

Following the start of the complex in January, China's imports of ethylene fell to 66,215 tonnes in April, 29% lower than the same period of last year and 9% less than March, according to the data from China Customs. (please see table below)

Butadiene imports plummeted by 63% year on year to 12,418 tonnes and dropped 33% from March volumes.

In addition, traders attributed the month-on-month imports slump of plastics-related chemicals, including polyethylene (PE), polypropylene (PP) and polyvinyl chloride (PVC), to the weak downstream demand.

April PVC imports decreased by 53% year on year to 106,910 tonnes and fell 28% from March, China Customs said.

“Last month, the PVC import prices were higher than domestic prices, which naturally lead to a fall in imports volumes. Domestic oversupply also weighed down the buying sentiment,” a trader said.

However, feedstock imports of polyester products, including purified terephthalic acid (PTA) and monoethylene glycol (MEG), bucked the trend and showed a 10% and 30% rise, year on year, to 474,049 tonnes and 633,738 tonnes respectively. Traders attributed "better downstream operations" as a factor for the increase.

“The feedstock inventory of downstream buyers is very low and the operating rate of polyester plants is around 80%. The textile sector is [performing] better than last year,” a trader said.

“Whether the petrochemical imports will show an upward trend in the next few months still depends on the recovery of downstream sectors,” Du Zhiqiang, an analyst from Shanghai-based Ping An Securities said.

April Export Import Data of some Petrochemicals

Apr-10	Import			Export
Product	Import (tonnes)	YoY growth (%)	MoM growth (%)	Export (tonnes)	YoY growth (%)	MoM growth (%)
Naphtha	179,199	7%	-19%	50,308		-55%
Olefins
Ethylene	66,215	-29%	-9%	1,602	2867%	53300%
Propylene	110,688	-20%	-22%	0	-100%
Butadiene	12,418	-63%	-33%	7,771	298%	3%
Polymers
HDPE	284,375	-5%	-23%	13,142	256%	97%
LDPE	134,818	0%	-40%	4,175	135%	50%
LLDPE	206,373	1%	-24%	632	-8%	-47%
PP	317,834	-11%	-15%	7,300	86%	-7%
PVC	106,910	-53%	-28%	27,434	181%	15%
Aromatics
Benzene	41,907	-40%	77%	3,076	7224%	-60%
Toluene	79,058	-4%	-8%	91	-73%	-57%
MX	16	-98%	220%	65	30%	124%
PX	392,783	24%	27%	20,194	-13%	-13%
Intermediates
SM	374,160	29%	10%	2,093	-45%	-59%
PTA	474,049	10%	-1%	0
MEG	633,738	30%	-8%	156	-95%	-11%
ACN	34,015	-40%	-2%	0
Caprolactam	62,847	22%	-4%	3	50%	-40%
Phenol	41,834	-10%	-36%	6,583	5296%	213%

Source: China Customs

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By: Judith Wang
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