Global HDPE capacity in 2024-2030 would need to be a total of 13m tonnes/year lower than our base case to return to the 2000-2019 operating rate of 88%.
Asian Chemical Connections
Flat 2023-2050 demand growth in China and the developed world would leave the global market for nine synthetic resins 1bn tonnes smaller than the ICIS base case.
China’s polymers consumption in 2022 107m tonnes from a population of 1.4bn. The developing world ex-China’s consumption was at 84m tonnes from a population of 5.3bn. And the developed world consumed 82m from 1.1bn people.
In my downside scenario for China’s HDPE demand in 2023-2040 is correct, the country’s total consumption during this period would be 134m tonnes lower than the ICIS Base Case.
YEAR-ON-YEAR chemical company financial results could we improve in Q2-Q4 2023; But this should not be seen as a return to the Old Normal.
THE EARLY DATA suggest that China’s polypropylene (PP) demand could grow by 3% in 2023. This would be in line with the base case forecast I provided in February.
A SCENARIO-BASED approach is essential to understand US PE exports in 2023, based on non-plant economic factors
China’s cumulative HDPE demand under the downside scenario would be 97m tonnes lower than our base case. in the above chart
Capacity exceeding demand is forecast to reach 218m tonnes this year from a 1990-2022 annual average of 76m tonnes.
EVEN IF CHINA’S PE demand grows at 10% in 2023, with very strong growth in other regions, this year’s global capacity would still be 22m tonnes more than demand!