By John Richardson WHEN is a target for GDP growth almost irrelevant? Perhaps this year in China, when if history is any guide, even if China genuinely hits its 7.5% growth target, chemicals demand growth could considerably undershoot this number. See the above chart for polyethylene (PE), and here is the explanation: In 2009, when China’s […]
Asian Chemical Connections
China’s 2014 GDP Growth Target
By John Richardson THE blog is scratching its head this morning as it tries to work out how China can have it both ways. Yesterday, Li Keqiang, China’s Premier, announced that the country’s 2014 GDP growth target would be 7.5%, whilst he also pledged to press ahead with economic reforms. But how can economic reforms […]
China “Base Case” Indicates Another Good Year
By John Richardson LAST year was a tremendous year for polyethylene (PE) exporters to China, according to data provided by US-based International Trader Publications, the US-based trade data and analytics service. They conclude that China’s imports of high-density polyethylene (HPDE) and low-density PE (LDPE) posted strong gains. Volumes for 2013 were up 18% and 10%, respectively, versus […]
China GDP Slowdown No Surprise
By John Richardson ALL but two analysts out of a Bloomberg survey of 41 over-estimated China’s first-quarter GDP growth. Monday’s announcement of the 7.7% increase – pushing China in to the longest streak of expansion below 8% for 20 years – understandably, therefore, led to numerous downgrades in full-year 2013 growth forecasts. For example: *Louis […]
Oil Prices Fall, As We Warned
Source: Daily Forex By John Richardson WE warned on 4 April that real economics threatened a sharp correction in crude-oil prices and it now appears to be happening. “New York’s main contract, West Texas Intermediate for May delivery, closed at $US88.71 a barrel on Monday [15 April], down a hefty $US2.58 from Friday,” wrote The […]
No Relief For China SMEs
By John Richardson THE consensus view is that China’s economy bottomed out in H1 and will see a recovery in GDP growth during the second half. Much hope has been attached to more government stimulus delivering a short-term boost to growth, even if there are concerns over the long-term damage that further investment-driven GDP could cause. […]
China PE Demand Down 3 Percent
By John Richardson GROUND level economic conditions in China are still a lot weaker than headline GDP (gross domestic product) numbers suggest. For example, a polyvinyl chloride (PVC) sales and marketing executive said: “PVC demand growth is going to be in minus territory this year. Carbide-based producers are likely to continue to have to run […]
China To Grow at 3 Percent
By John Richardson THE possibility that China’s economy may not expand as rapidly in the future as in the past is never discussed in public by resources-company CEOs, said an Australian-based stockbroker. His comments ring true for petrochemicals, also. The blog is struggling to find a senior executive willing to discuss this possibility on the […]
China Economic Optimism
By John Richardson ECONOMISTS think China’s growth has bottomed out, thanks to unexpectedly strong March bank lending. They also think that interest rates will stay low for a long time, even if rates cannot be cut because of the inflation problem. New loans in March totalled Rmb1trn ($159bn), more than banking analysts had expected. This renewed […]
Fears Rise Over China Long-term China Demand Dip
By John Richardson ANXIETY seems to be growing in the chemical industry over China’s plan to migrate its economy away from export dependence towards greater domestic consumption. The sense of nervousness picked up in several conversations with company executives over the past few weeks indicates how much is at stake for an industry that has […]
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