If we are to see a repeat of 87% in 2024-2030 (the green line in the chart) and assuming my forecast of 2% demand growth is correct, the increase in global capacity would need to average just 154,000 tonnes/year during each year between 2024 and 2030. This is versus our base case of 4.5m tonnes/year of annual increases.
Asian Chemical Connections
If GDP growth were a percentage point lower than ICIS forecasts during each of the years between 2023 and 2040, and assuming the same 0.7% polymer multiple over GDP, annual consumption of the nine synthetic resins would be around 10m tonnes a year lower than our base case.
Environmental, social and political factors – along with integration into upstream petrochemicals – have held back plant closures. Now, things seems very different.
THE PHRASE “pushing on a piece of string” might best describe the logic behind calls for another round of big economic stimulus in China. Any extra money pumped into the economy could be largely saved rather than spent because of weak consumer confidence resulting from an ageing population and the end of the property bubble.
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 NET IMPORTS of HDPE could be either 126m tonnes in 2023-2040, 38m tonnes or as low as 7m tonnes
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.
Climate change and demographics are economic destiny – their effects cannot be avoided. But the petrochemicals industry has a huge role to play in shaping favourable outcomes
Companies behind the crackers due on-stream over the next four years emphasise the low-carbon output. The planned new plant also have excellent economies of scale