By John Richardson PLEASE DON’T say I didn’t tell you. Further big declines in China’s paraxylene (PX) imports seem likely in. We could also see less dramatic falls in polypropylene (PP) and styrene monomer (SM) imports this year, which I shall detail in later posts. But here a I shall focus on PX. This year’s […]
Asian Chemical Connections
The new oil shocks: semiconductor supply shortages threaten the global economy
By John Richardson HIGH VALUE semiconductors, which are defined as five nanometres (billionths of a metre) or less in size, have become the new oil – as vital as the black stuff for the workings of the global economy. Semiconductors will, in fact, become even more important as the age of oil comes to an […]
China petrochemicals overstocking likely substantial as Q1 slowdown risks increase
By John Richardson THE ABOVE chart on the left – showing average month-on-month percentage increases in China’s polypropylene (PP) imports in 2009-2019 versus the pattern in 2020 – underlines my argument that the production and export-led recovery that China enjoyed last year was part of a government plan. You can see the same pattern in […]
Final China PE 2020 numbers and new outlook for this year as logistics and pandemic threats increase
By John Richardson NOW THAT we have the final data for 2020, for last December, we can complete the picture of what was a truly extraordinary year. As I’ve been highlighting since last August onwards, a pandemic-related shift in demand led to a much stronger Chinese polyethylene (PE) market than just about anyone had expected. […]
Vaccine nationalism and lack of debt relief remain major threats to petchem growth
By John Richardson WE LIVE in a highly interconnected world as this statistic underlines: of the $18tr worth of goods that were traded last year, intermediate goods or components of finished goods represented $11tr, according to the Organisation for Economic Cooperation and Development. In the key automotive, textile, retail and construction petrochemical end-use industries, many […]
China’s economic dominance carries many short and long-term risks for petrochemicals
By John Richardson JUST 5% of US companies with revenues of more than $500m plan to relocate operations out of China, according to the latest survey by the American Chamber of Commerce in Shanghai. This partly reflects highly networked manufacturing clusters, wrote the Australian Strategic Policy Institute in this excellent article. “Automotive and electronics clusters […]
Petrochemical companies must invest more in new methods of assessing demand
By John Richardson INVESTORS must look beyond measures of GDP growth if they are going to understand what is really happening in the global economy, wrote James Sweeney, chief economist at Credit Suisse, in the Financial Times. “Body temperatures, foot traffic, internet trends and stimulus cheque arrivals represent a small sample of the data that […]
New China pandemic outbreak China single-biggest risk for global petchems in 2021
By John Richardson CHINA FACES another test of its pandemic control capabilities because of new outbreaks in Hebei and Heilongjiang provinces. On Wednesday, China recorded its first coronavirus death in eight months in Hebei. From an economic perspective, the good news, as CNBC reported, was that “Heilongjiang accounted for just over 1% of China’s GDP […]
China polyethylene imports set to remain strong in 2021 despite big local capacity growth
By John Richardson IT WAS a tremendous year. China’s 2020 polyethylene (PE) demand growth over 2019 averaged 10% across the three grades. This comprised a 13% increase in demand for high-density PE (HDPE), a 2% decline in demand for low-density PE (LDPE) and a 13% rise in linear-low density PE (LLDPE) demand, according to my […]
China’s BRI will go from strength to strength, redrawing global petrochemicals map
By John Richardson CHINA’S Belt & Road Initiative (BRI) is alive and kicking and will, in my view, go from strength to strength as it radically reshapes the global economy, China’s geopolitical relationship with the US and global petrochemical trade flows and investments. Why it is alive and kicking? Because China has no other choice. […]