The ICIS weekly margin reports continue to provide essential reading for anyone in the petrochemical value chain. The above chart is particularly fascinating, as it highlights the significant differences between cracker margins on a regional basis over the past 2 years: • Europe (red column) is the clear winner over the period. Its margin bottomed […]
Tag Archives | Polyethylene
China’s PE imports slip: Middle East gains market share
China has been the main source of chemical and polymer demand growth over the past 2 years. But newly released trade data suggests its import volume on core products such as polyethylene may now be reducing, as more domestic capacity comes online. Equally, Asian producers, and the USA, face strong competition from low-cost Middle East […]
Olefin ‘spreads’ remain volatile
Last March, the blog highlighted the major changes taking place in ethylene, propylene and butadiene prices versus naphtha. It also analysed them in ICIS Chemical Business in September. The above chart now summarises the 2010 outcome, using European prices to enable comparison over the last 30 years. It was a most remarkable year. The chart […]
Petrobras moves forward on green polymers
The blog was very pleased to talk recently to Business News Americas about developments in Latin America. Please click here if you would like to read the full interview. It highlights the key role being played by Brazil’s Petrobras, particularly in the development of ‘green polymers’. These are still very small in volume, compared to […]
Oil prices create European polyethylene “shortage”
Oil price rises reduce chemical demand. Initially, as we saw in 2007 – H1 2008, and in 1979 – 80, everything seems fine. Consumers continue to buy, and we all reassure ourselves that demand is still robust. But, in fact, end-use demand starts to fall when prices rise, as individuals cut back on discretionary spending […]
China cracks down on futures speculation
China’s Dalian futures market has become a hotbed of speculation over the past 2 years, since the government doubled bank lending to $1.4trn during 2009, equal to 1/3rd of GDP. Traders have particularly focused on the assumed linkage between LLDPE (linear low density polyethylene) and crude oil, with price movements mirroring each other most months. […]
Dalian follows oil, interest rate, speculation
The past fortnight has confirmed the strong linkage between Dalian futures trading, and financial market speculation. Dalian prices (red line) for linear low density polyethylene (LLDPE) rose steadily in early September, as traders bet on higher crude prices. They had gained RMB 600/t ($90) by last Wednesday. But then rumours began flying that China’s interest […]
Dalian’s LLDPE contract rises as demand slows
Undertaking fundamental analysis of a market can be a tedious business. You have to try and understand what uses the product might have, and the alternatives for the feedstocks. You might even have to look at inventory, and forecast future supply/demand levels. Luckily, however, for the modern financial investor, these sad disciplines have been resigned […]
Propylene prices reach parity with ethylene
As promised on Saturday, today’s post looks in more detail at the major change taking place in the relationship of propylene to ethylene prices. When the blog joined the chemical industry in the 1970′s, propylene was often regarded as a disposal problem by many cracker operators. They ran their plants to produce ethylene, which was […]
China’s Dalian volumes drop 74%
A year ago, China’s Dalian futures exchange was hitting its peak, in terms of polymer volume. The Linear Low Density Polyethylene (LLDPE) contract saw 80 million tonnes (blue line) traded in April. This was more than 3 times total annual world production. But as the chart above shows, volume last month was ‘only’ 21MT – […]