By John Richardson So far so good – everything is going to plan. The flash Markit/HSBC China Purchasing Managers’ Index (PMI) for May fell to 49.6, slipping under the 50-point level demarcating expansion from contraction for the first since October last year and sending Asian financial markets sharply lower. But, crucially, as Reuters pointed out in this article, […]
Asian Chemical Connections
Get Behind China
By John Richardson THE blog is often accused of being pessimistic. We are not. We are just realistic. It was realistic last November to anticipate that China’s new leaders would be dedicated to major economic reform. In fact, this was clear even earlier than that – back in February 2012 when the World Bank produced […]
China Hints At Yuan Depreciation
By John Richardson LABOUR markets are tight in China and so on the surface there appears to be no great pressure on Beijing to attempt to export its way out of an unemployment crisis. But what happens if, as we suspect, real GDP growth has fallen to 4% or even lower? The government, despite its […]
Global Deflation
By John Richardson TEN trillion dollars doesn’t buy what it used to do, according to The Wall Street Journal. The reason is that despite central banks across the world aggressively expanding their balance sheets, there is no inflation. “My customers in China are worried about the opposite – global deflation because demand everywhere is so […]
APIC And Demand
Just an anomaly? Source: American Chemistry Council By John Richardson FEEDSTOCK advantage is, of course, crucially important, but so is demand. And yet the only subject that most people wanted to talk about in any depth at last week’s Asia Petrochemical Industry Conference (APIC) appeared to be how to achieve feedstock advantage. Why? […]
China PE Demand In 2013: Flat Or Declining
By John Richardson SENTIMENT continues to severely undermine polyethylene (PE) demand in China as converters, lacking confidence in a big new economic stimulus programme later this year, keep their raw-material purchases to an absolute minimum. “It used to be the case that our customers bought four containers at a time. Now it’s down to two,” said […]
Beijing: China Deceleration On Track
Source of chart: http://blogs.ft.com/beyond-brics/ By John Richardson THERE has been a hugely important shift in the attitude of China’s central government. In the old days, when they set a target of say 12% national industrial production growth for a particular year, such targets were usually wildly exceeded. This was the result of local governments, […]
Players In Europe And Asia Are Serious About Cheap US Ethane
A fascinating guest blog post by my colleague, Nigel Davis (see below) explores how excess US ethane supply could help raise the competitiveness of European and US crackers. Provided, of course, that there is sufficient demand. By Nigel Davis IT is becoming clear that European companies aside from INEOS are looking seriously at importing ethane […]
Oil Prices Fall, As We Warned
Source: Daily Forex By John Richardson WE warned on 4 April that real economics threatened a sharp correction in crude-oil prices and it now appears to be happening. “New York’s main contract, West Texas Intermediate for May delivery, closed at $US88.71 a barrel on Monday [15 April], down a hefty $US2.58 from Friday,” wrote The […]
Here We Go Again
By John Richardson EVERYONE should read the following section from this Economist article with great concern. Central bank stimulus might well be doing more harm than good. “When Americans borrow money to buy a car or a house, their debts are often repackaged as the backing for a bond,” writes the Economist. “Before 2007 investors […]
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