By John Richardson CHINA’S polyolefin market was in “total chaos and panic” this morning, according to a Singapore-based trader. The Dalian Comodity Exchange’s futures contract in linear low-density polyethylene (LLDPE) fell a further 5% this morning after declines earlier in the week, according to ICIC news. The weak futures markets caused a supply surge in the […]
Asian Chemical Connections
Polyolefins At A Tipping Point
By John Richardson EUROPEAN polyolefin markets are at one of those fascinating tipping points following the recent price recovery. Ethylene spot prices rebounded late last week with July sales much better than those in June, wrote Nel Weddle, European ICIS pricing olefins editor, in this report. Propylene, however, remained under pressure because of a long market. […]
Saudi Petchem Production Threatens Recovery
By John Richardson RISING oil production in Saudi Arabia has resulted in bigger volumes of polyethylene (PE) being delivered into Asia-Pacific markets, a source with a major plastics processor told the blog late last week. “Saudi Arabia has definitely, in my view, already raised PE production on more availability of associated gas. I am seeing […]
Europe Not Clutching At Straws
By John Richardson EUROPEAN ethylene and polyethylene (PE) market participants seem a million miles away from buying into the idea that the recovery in Asia is sustainable. This is a realistic view following last week’s interest rate rise in China, the fifth in eight months – and with the announcement over the weekend that inflation in June […]
Living In Hope Rather Than Expectation
By John Richardson HOPEFUL theories espoused by traders can sometimes sound a little hollow – as was the case with the one doing the rounds in Asian polyolefin markets late last week. “We think the latest interest rate rise in China will be the last this year and so, in a way, the announcement was good […]
European PE, PP Contracts Likely To Fall
By John Richardson EUROPEAN polyolefin converters seem quite justified in pressurising their suppliers for further price reductions, given weak macro-economic fundamentals and still-excellent profitability at the cracker end of the value chain. The news from China continues to get worse. China’s Vice-Premier Wang Qishan said last week that the government’s 2011 targets for GDP growth and […]
Clinging On To Vain Hopes
By John Richardson ANYONE clinging on to the hope that the weakness in the global polyolefin market is merely down to China going through a prolonged period of destocking could face a rude awakening. China’s polyethylene (PE) demand was down 4% in January-May this year, at 7.1m tonnes, compared with the same period in 2010. […]
Boom, Gloom and the New Normal – Chapter 2 Published Today
Chapter 2 of Boom, Gloom and the New Normal is published today. In a completely new and challenging analysis we argue: • The Western BabyBoomers boosted chemical demand for housing, autos and electronics during their peak consumption years between 1980-2000. But this demand is unlikely to be sustained, now they are entering the 55+ age […]
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 […]
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