Tag Archives | Polyethylene

D

‘Waiting for Bernanke’ is hottest show on Wall Street

‘Waiting for Godot’, the great play by Irish writer and Nobel Literature Prizewinner, Samuel Beckett, deals with the meaning of existence. Written just after the Second World War, its two characters wait endlessly for the arrival of Godot. US financial markets are currently staging their own version of the play: • They no longer see […]

Continue Reading
D

A is for Agility in today’s VUCA world

Pity the poor purchasing manager, who: • Must keep inventories low as end-user demand remains slow, and the CFO remains very worried about the working capital risk • Must keep inventories high, to minimise the risk of running short if supply problems develop and prices jump Benzene (green line), as always, is the great example […]

Continue Reading
D

IMF warns of lower global growth

Once again, the chemical industry has performed its role as a reliable leading indicator of the global economy. On Friday, the IMF warned their next forecast: “Will be tilted to the downside and certainly lower than the forecast that was published three months ago” This will not be news to blog readers. As the chart […]

Continue Reading
D

Weak chemical markets suggest difficult times ahead

Over Christmas, the blog spent some time considering whether its IeC Downturn Alert had served its purpose. By luck, or possibly judgement, it had been launched at the exact market peak on 29 April. And hopefully it had helped to alert companies to the difficult times that lay ahead. But by December, most analysts and […]

Continue Reading
Brazil PE Jun12.png

Brazil’s PE exports increase as its economy slows

Brazil’s economy has soared in recent years, as its raw materials have supplied China’s infrastructure boom. China now accounts for 17% of total exports, and has replaced the USA as its largest trading partner. In turn, of course, this led to major growth in Brazil’s own chemical demand. Its polyethylene (PE) imports grew 78% from […]

Continue Reading
China PE Jun12.png

China’s PE demand continues to weaken

China’s polyethylene (PE) demand continues to highlight the slowdown underway in the wider economy. As the chart shows for the January- May period, based on data from Global Trade Information Services: • Overall demand (red column) was down 5% versus 2010 (blue) • China’s production continued to increase, up 1% • Imports were down 9%, […]

Continue Reading
D

Another Minsky Moment may be approaching

The global economy is now in the middle of its 3rd downturn in the past 4 years. The chart above shows how the blog’s benchmark products have acted as leading indicators on each occasion (yellow highlight): • In 2008, naphtha (red line) PTA (purple), benzene (green) and polyethylene (PE, blue) all peaked around the middle […]

Continue Reading
D

Financial markets rally as real economy weakens

Petrochemical markets continue to provide plenty of warning signs about the deteriorating state of the global economy. As the above chart shows of price movements since January, even benzene is now weakening as supply disruptions fade. The obvious conclusion is that downstream users have simply been unable to pass through recent increases. Instead, these further […]

Continue Reading
D

“A failure to stay ahead of events”

Petchem markets are doing an excellent job in their role as a leading indicator for the global economy. But as we warn in Boom, Gloom and the New Normal, policymakers remain in Denial about their message. The chart above spells it out clearly. Volume leads pricing. Since January, China’s demand growth has collapsed. So its […]

Continue Reading
D

What goes up, comes down

Don’t panic is the blog’s suggestion, after last week’s market collapse. Instead, the important thing is to plan for what might happen next. Scenario planning is absolutely critical to survival over coming months. The blog’s advice is to assemble your management team as quickly as possible, and ask everyone to come prepared to be honest […]

Continue Reading