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Chemicals and the Economy

Goodbye to “business as usual” model for plastics

Polymer markets face two major challenges in coming months. The most immediate is the arrival of the major US shale gas-based ethylene and polyethylene expansions. The longer-term, but equally critical challenge, comes from growing public concern over plastic waste, particularly in the ocean. The EU has set out its vision for a new plastics economy, where: “All plastic packaging is reusable or […]

Sinopec confirms move into China’s New Normal economy

Sinopec, China’s largest chemical company, has just published its operating results for 2014.  We don’t yet have all the details, but the chart above highlights the key points of its cumulative performance since it first filed public accounts in 1998: It has invested Rmb 288bn ($41bn) in capital expenditure for refining, and Rmb 239bn ($33bn) for chemicals (blue columns) […]

Sinopec & China arrive in New Normal of low growth and profit

Sinopec is China’s largest chemical producer and its second largest refiner.  The blog’s annual review of its published Results confirms its uniqueness in global markets. The numbers confirm that it remains focused on increasing production, not profit.  It will be No 2 in global ethylene capacity next year as a result.  The chart above highlights the key metrics, based […]

Sinopec focuses on political and social targets

Sinopec is China’s main company in refining and chemical markets. Although it is listed on world stock markets, the government remains its largest shareholder with a 76% stake. As such, it follows government priorities rather than western commercial logic. The chart above, from the blog’s major new study of the company, highlights some of the […]

US PE exports down 39% despite shale gas

Globalisation had a golden age between 1982-2007. Trade barriers fell almost everywhere. Companies focused on achieving a ‘lowest cost’ position, in order to maximise their competitive advantage. Today, however, the world is starting to look quite different. The chart above summarises the changes underway. It shows US polyethylene net trade (PE) since 2009, based on […]

Sinopec adds capacity as China’s ethylene growth stalls

Sinopec is China’s leading petchem producer. Its H1 results, out this week, confirm the blog’s concern that China’s growth surge has stalled. The chart shows Sinopec’s view of domestic demand growth for ethylene (blue line). After falling to zero in 2008 as the Great Recession began, growth rebounded to ~10% in 2009-10. But in H1 […]

China’s PE cutbacks suggest economy is slowing

China’s stimulus programmes have been a major support for the global chemical industry over the past 2 years. In polyethylene (PE), for example, its total demand grew an astonishing 53% between 2008-10, from 11.7MT to 17.9MT. But now, China’s rapid demand growth seems to have slowed. According to Thomson Reuters, China’s PE consumption actually fell […]

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