By John Richardson BACK in November 2014, when I first suggested that China might move to self-sufficiency in paraxylene (PX), my blog post was met with widespread scepticism. At that time, China was moving from a major import position in purified terephthalic acid (PTA) towards becoming a net exporter. This led to a lot of […]
Asian Chemical Connections
New Petchems Business Model Based On Trading Blocs
By John Richardson THE above chart should give every analyst who thinks low feedstock costs are by themselves guarantee of success in petrochemicals pause for thought: US net polyethylene (PE) exports in 2016 were 5,000 tonnes lower than in 2015, even though one would have expected exports to have been ramped-up last year. Increased exports would have helped […]
Supply-Driven Petrochemicals Success Under Threat
By John Richardson THE OLD joke goes like this: “If oil and gas exploration is the gorilla, refining the dog and petrochemicals the tail on the dog, what does the gorilla say when he looks at the dog? He says, “I can’t even see the tail on the dog’ ”. The history So events upstream […]
Polyethylene Markets To Become More Regional, Less Global
By John Richardson THE GREAT US author Mark Twain, pictured on the right, needed to pay off his debts. So in May 1897, he was in London during a round-the-world speaking tour designed to raise the money to pay off his debts. People don’t usually turn up to see dead people speak. He was therefore a […]
China Polyethylene: Increased Local Naphtha Supply Threaten Imports And Margins
By John Richardson CHINA’S polyethylene (PE) demand grew from around 22m tonnes in 2914 to approximately 25m tonnes in 2016 – an increase of 12.16% based on the exact numbers, according to ICIS Consulting. Even better news for the global PE industry is that this strength in Chinese demand has occurred during a period when there have been […]
Bricklaying In Australia And Oil Prices: Important Similarities
By John Richardson THE bricklayer came around to my house three years ago, quickly surveyed the extent of the job, drew a sharp breath, and said, “It’s going to cost you at least Aus$4,000.” And that was after a four-week wait to get a quote. How times have changed. Last week, the same bricklayer popped around […]
Global Chemicals Operating Rates Lowest Since 1987
By John Richardson SOMETIMES one single chart is worth many thousands of words, which is the case with the chart. Hence today’s brief post as the chart tells you a great deal of what you need to know: Based on American Chemistry Council data, and borrowed from the latest PH report, it shows that average global chemicals […]
Modelling And Responding To China’s Demand Complexity
By John Richardson PRODUCT by product you need to build alternative scenarios for demand growth in the key China market. The future might end up being the same as the past up and down all the petrochemicals value chains. But if this is your only scenario and it goes wrong you are going to end […]
The OPEC “Deal”: What It Really Means
By John Richardson THE OPEC decision to cut oil production for the first time since 2008, if indeed it does amount to a real cut in production, could end up being self-defeating. As I discussed last month, US shale oil production efficiency continues to go quite literally through the roof of most forecasters expectations. Between […]
Polyethylene: A World Turned Upside Down
By John Richardson THE recent history of polyethylene (PE) shows a global competitive landscape very different from that which most people expected two years ago. Two years ago, we were told that the natural price for oil was $100/bbl because of limited supply and robust demand growth. The consensus view was also that whilst costly oil meant that […]
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