The good news from the latest reports on US house prices and auto sales was simple – things have stopped getting worse. US house prices saw “some stabilisation in some regions” according to the S&P/Case Shiller Index for April. Whilst auto sales are clearly bouncing along the bottom, down “only” 29% in June versus May’s […]
About Paul HodgesPaul Hodges is Chairman of International eChem, trusted commercial advisers to the global chemical industry. He also serves as a Global Expert for the World Economic Forum. The aim of this blog is to share ideas about the influences that may shape the chemical industry and the global economy over the next 12 – 18 months. It looks behind today’s headlines, to understand what may happen next in critical areas such as oil prices, China and Emerging Markets, currencies, autos, housing, economic growth and the environment. Please do join me and share your thoughts. Between us, we will hopefully develop useful insights into the key factors that will drive the industry's future performance.
Author Archive | Paul Hodges
Capacity closures are always hard to achieve in the petchem industry: • First, these are a ‘zero sum game’ – if I shut my plant, then other producers gain in terms of overall operating rates and margins, at my expense • Secondly, there is the integration issue. Closing a consuming plant also impacts output from […]
Last month, the blog introduced its new Boom/Gloom Index, designed to track sentiment in financial markets. The chart above now updates it to reflect the whole of June. The Index has continued to move up, and is close to the levels last seen in October 2007. Equally remarkable is the performance of the Green Shoots […]
Germany and China have benefited massively from the growth in world trade since 1980. As the Wall Street Journal chart shows, 47% of Germany’s GDP comes from exports. And China has a 37% dependence. US exports are just 13% of GDP, so it is more self-sufficient. Both countries have punched above their weight in terms […]
The blog is now 2 years old. Its readership is very loyal, and continues to grow. 64% of current readers bookmark the blog, and read it regularly. And it is now being read in 2088 cities and 111 countries – versus 1244 cities, and 89 countries, 6 months ago. Its regular readership is also very […]
Economic recovery can’t come soon enough for Ineos. After 7 months of negotiation, it has finally agreed new covenants for its €7.3bn of debt with its major lenders. These will now be put to all 230 lenders for approval by 17 July. But the price is high: • Initially, Ineos was paying c2.5% over euro […]
Yesterday’s financial market action was very revealing. As Olivier Jakob of Petromatrix perceptively describes it, “liquidation on gasoline led to a correction in crude oil, which in turn pressured equity markets”. The problem is that financial markets now seem to be in circular mode: • Speculation about tighter oil markets has led to a belief […]
The chemical industry is always a leading indicator of the global economy. One of the blog’s oldest friends used to be a central banker, and he made no secret of the fact that our discussions about demand levels were often an important factor in his overall analysis. So it is no great surprise that the […]
The great wave of destocking is finally coming to an end. And it is clear that underlying global demand is well below previous “normal” levels. The evidence for this can be seen in the above chart, based on American Chemistry Council data, which shows global chemical production down 12.8% in April versus 2008. And as […]
The blog’s close eye on Scotland’s media has again been rewarded this morning, as ‘The Scotsman’ reveals that Ineos have appointed Morgan Stanley, the investment bank, to advise on the sale of Grangemouth. It suggests that a company such as “PetroChina could buy the refinery, while Ineos would retain the polymer and petro-chemical processing plants […]
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Paul Hodges is Chairman of International eChem, trusted commercial advisers to the global chemical industry.
The aim of this blog is to share ideas about the influences that may shape the chemical industry over the next 12 – 18 months. It will try to look behind today’s headlines, to understand what may happen next in important issues such as oil prices, economic growth and the environment. We may also have some fun, investigating a few of the more offbeat events that take place from time to time. Please do join me and share your thoughts.
Between us, we will hopefully develop useful insights into the key factors that will drive the industry's future performance.