By John Richardson MOST of the analysis on the tenth anniversary of the Global Financial Crisis (GFC) focuses on the effects on Western economies and societies. Economic inequality has risen since 2008 resulting in the rise of populist politics, is a very common theme. But almost entirely overlooked is the huge effect that the GFC […]
Asian Chemical Connections
US ethylene glycols: The Cost Of Exclusion From China
By John Richardson IF THE US were unable to export ethylene glycols (EG) to China the economic logic of US capacity expansions would face major challenges. Between 2018 and 2025, China will account for no less than 84% of global net imports (imports minus exports) amongst the major importing regions and countries. (For those who […]
US Economic Strength Of Little Benefit To Global Polyolefins
By John Richardson THE BETTER that things get in the US (provided you own equities and are not on a zero-hours contract) the worse things become in emerging markets. Despite a weaker greenback on a trade-weighted basis, the investor sell-off in emerging markets continued last Thursday, wrote Bloomberg in this article. The Lira was for […]
PE Margins Fall As Trade War Threatens Two Entirely Separate Trading Blocks
By John Richardson LET’S FIRST of all take a close look at what the above chart is telling us about the damage already done to polyethylene (PE) margins before considering what could happen next. US high-density PE (HDPE) margins are 47% lower in the year-to-date versus to 2017 and low-density (LDPE) margins are 45% lower. […]
Chinese PE Tariffs Come Into Effect: The Impact On The Global Business
By John Richardson CHINA’S 25% import tariffs on all grades of US high-density polyethylene (HDPE) and 93% of the grades of linear-low density (LLDPE), which came into effect yesterday, look set to cause major damage to the global PE business. One of the biggest casualties could be the earnings of US PE producers. We shouldn’t […]
Plastics Rubbish Crisis: How To Pick The Winning Polymer Producers
By John Richardson IT IS FIVE years from now. You are rich because you live in the developed world. It is first thing in the morning. You take your rubbish (or trash as the Americans say) into you backyard and place it in a series of bins where you separate not only recycled from non-recycled […]
US Risks Losing Access To 82% Of Global PE Consumption Growth, 80% Of Exports
By John Richardson PERHAPS this week’s low-level trade talks between the US and China shouldn’t only be judged on the basis that they are low level, involving officials of mid-level seniority who are therefore not empowered to achieve major breakthroughs. The talks on 22-23 August (23 August is when 25% Chinese polyethylene (PE) tariffs on […]
Turkey Crisis: Implications For Polyolefins And Global Economy
By John Richardson THE first ramification of the Turkey crisis is that the collapse of the lira raises questions over how Turkish importers will be able to afford the dollars to pay for some of the polyolefins imported since the crisis began. Then comes the issue of what happens to Turkish polyethylene (PE) and polypropylene […]
China Debt Squeeze, Trade War, Dollar Strength Pose Major Risks
By John Richardson IT DIDN’T matter if there was any truth behind the stories people used to tell each other about the Chinese economy as it underwent an unprecedented period of growth in 2009-2014. All that mattered was that a lot of people were making a lot of money as petrochemicals and polymers sales volumes […]
Global Trade War: $12.4bn of US Petchems Exports At Risk
By John Richardson THE CUMULATIVE negative effect on global GDP as more and more countries became involved in a trade war is estimated by the above table on the left, from a research paper by economists as the Australian National University. The table shows the impact of each country imposing an extra 10% tariffs on […]