Manufacturing output is contracting around the world. JP Morgan’s global index sank 15% in December, and they expect “an intense contraction phase” to continue “for some months to come”. The G7 and BRIC countries are all seeing a decline, as Nouriel Roubini notes: • The US ISM manufacturing index hit a record low of 32.2 […]
Q4 was never going to be good for US housing markets. The financial crash of September/October not only terrified potential buyers, but also meant they found it increasingly difficult to secure loans. As the chart shows, this lethal combination hit house prices hard. The latest S&P/Case-Shiller figures show prices down 24% in October from the […]
The blog is now 18 months old. It has a truly global readership, and as shown in the above map, is now read in 1244 cities and 89 countries. Its aim has always been to identify ‘the influences that may shape the chemical industry over the next 12 – 18 months’, and to ‘develop useful […]
2008 has not ended well for the chemical industry. First there was the collapse in demand, as the various value chains destocked in response to slowing consumer demand and lower oil prices. Then INEOS, the world’s 3rd largest chemical company, had to seek covenant waivers from its lenders. Now, according to the Wall Street Journal, […]
2008 has not been a good year for M&A in the chemical sector. First, there was the collapse of Hexion’s Huntsman acquisition. Today, the Kuwait government has signalled its intention to “scrap” its $17.4bn deal with Dow to form K-Dow. This is a quite extraordinary decision by a major Middle East government, especially as it […]
The blog has been searching the websites of the major central banks, such as the IMF, World Bank, Federal Reserve and Bank of England, for research on the history of credit crises. Several readers, including Paul Noble of Parsons Brinckerhoff, have also kindly forwarded helpful studies. The most comprehensive study that it has found analysed […]
The blog’s oil price forecasts have had a stellar record this year. Last month, with its $70/bbl forecast having been realised, the blog continued to worry about downside risk: “If refiners are forced to cut runs for December, then it would be hard for OPEC to cut its own production quickly enough to compensate. In […]
Prof Nouriel Roubini has long been correctly bearish about the economy, and was one of the first to highlight the deflation risk. In a new interview, he sets out his thoughts for 2009, and concludes: “I don’t believe we are going to be in a depression – but we could end up like Japan that […]
The chart, taken from the weekly ACC report, shows just how badly chemical production has been hit in recent months: N America. This region has been worst affected, with volumes down 12% in November versus 2007. W Europe/CEE. Both regions were down 3% in October versus 2007 Asia/Latin America. These regions are just positive, with […]
The recession will have a major impact on M&A activity next year, according to a new analysis by Pilko & Co. Their key conclusions are: • Increasingly,deals will be the result of financial restructurings, workouts or bankruptcies. • Buyers with cash and debt capacity will be able to dictate terms. • Asian/Middle East buyers will […]
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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 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.