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Asian Chemical Connections

PE Market Weakness Spreads To US

By Malini Hariharan After Europe, the US polyethylene (PE) market has started showing increasing signs of weakness. Spot offers have rapidly fallen putting downward pressure on June contracts that are currently under negotiation. Producers may have no choice but to settle at lower levels as exports to Asia is no longer a viable option. Spot […]

European Markets Weaken Further

By John Richardson THE dreadful state of European polyolefin markets became even more evident late last week as prices continued their declines. Discussions on further reductions in European olefin contract prices were also set to begin today. High density polyethylene (HDPE) and linear low-density polyethylene (LLDPE) spot prices have now fallen by Euros80-150/tonne in June, […]

Chemicals Buying & The IEA Decision

  By John Richardson CHEMICALS and polymer demand looks even less likely to be supported by “buying forward” following yesterday’s decision by the International Energy Agency (IEA) to release 60m barrels of crude into the market. Here is a bit of context first before we look at the implications of the IEA decision, which, along […]

Chemicals “Spin” Will Continue

By John Richardson THE reluctance of sell-side chemicals analysts to downgrade their forecasts should be severely tested by the Federal Reserve’s decision to downgrade its outlook for the US economy. US GDP growth will now be only 2.7-2.9% in 2011 compared with the April estimate of 3.1% to 3.3%, Fed chairman Ben Bernanke told a […]

US Olefins, Polyolefins In Denial

  By John Richardson THE majority of financial analysts seem to be clinging on to the hope that the recovery in petrochemicals demand from China is about to happen. This doesn’t just apply to our industry. Analysts across many sectors appear to have staked their reputations on a return to the Old Normal of booming […]

Chemical Shares Fall From “Buzz Mountain” Summit

By John Richardson CHEMICAL share prices have surged to the top of what one industry observer calls “buzz mountain” during the last six months. The buzz has been centred on the supercycle theory which holds that recent corrections in commodity prices are nothing more than a temporary blip. Formosa Plastics Corp (FPC) and Formosa Chemicals […]

Misplaced Faith In China Recovery

By John Richardson WEAKER domestic consumption-growth in China represents a major challenge to the argument that global petrochemicals demand, and therefore pricing, will see a strong recovery during 2011. Price declines continued last week with low-density polyethylene (LDPE) down a further $20-50/tonne as the polymer, as we have reported before, continues to be dogged by […]

Ethylene And PE Markets Decline Continues

By John Richardson THE decline in Asian and European ethylene and polyethylene (PE) markets continued last week with no sign of the recovery that producers still hope will take place by end-June at the latest. Asian ethylene prices slipped by a further $60-70/tonne to $1,130-1,170/tonne FOB Korea to reach a six-month low, according to our […]

Saudi Crackers Could Soon Be At 100%

By John Richardson SAUDI ARABIA’S crackers could soon be running at operating rates of 100% again following widespread reports quoting the al-Hayat newspaper that the country’s crude production is set to rise to 10m barrels a day in July. Al-Hayat, a Saudi newspaper, is seen as a reliable indicator of government intentions. We reported last week how […]

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