The second of our series of blog posts on China’s economic challenges over the next 12-18 months focuses on deflation. By John Richardson DEFLATION has now become a major concern for the Chinese economy following the release of official data earlier this week that showed a 2.1 percent decline in producer prices in June […]
Asian Chemical Connections
China Bad Debts
In the first of a series of blog posts on the major challenges facing China’s economy over the next 12-18 months, we look at bad debts. High stakes in Hangzhou. Source of picture: Wikimedia By John Richardson A fascinating blog post by Patrick Chovanec makes this very worrying observation about China’s bad debt […]
China’s VUCA Moment
Ben Bernanke. Source of picture: Wikipedia By John Richardson OUR next three blog posts will examine some of the threats to a recovery in China’s chemicals and polymer demand growth over the next 12-18 months. We will look at: *Debt. Is China already confronting a Ben Bernanke moment? (In November 2007, the Fed […]
KPMG Warns Of US Overcapacity
By John Richardson A management consultancy has gone on the record to warn about what the blog has been warning about for months: That the US petrochemicals industry is in danger of pushing itself into oversupply. KPMG, in a report released late last month, said that the success of planned US expansions, including as […]
The Water Challenge
Source of picture: BBC By John Richardson By 2050, the world’s 10 biggest river basins by population are expected to produce a quarter of global GDP, according to a report commissioned by HSBC, which was released in June. The figure is greater than the combined future economies of the US, Japan and Germany – and […]
Dictating Chemicals Demand
By John Richardson SOME commodity chemicals companies still assume that, if they build new supply, demand will always eventually catch up with supply. The risks of not building new capacities, at times of easy financing and feedstock availability, are also viewed as too great. These include deteriorating economies of scale and loss of […]
June China Lending Disappoints
By John Richardson POLYETHYLENE (PE) and polypropylene (PP) offer prices were reportedly on the rise across Asia earlier this week on increasing geopolitical tensions over Iran that led to a hike in crude prices. “Butene-grade linear-low density (LLDPE) offers have increased by $40-50/tonne,” said a source with a major producer. September LLDPE futures contract […]
China’s Luxury Goods Risk
By John Richardson THE “luxury end” of China’s polyethylene (PE) market is being heavily targeted by overseas producers and the results so far have been pretty spectacular, according to one of the producers. “The annual growth in demand for higher value grades has been tremendous – two times GDP,” said a senior executive with […]
Managing China’s Political Challenge
By John Richardson Getting on with politicians is always pretty useful for doing business anywhere. And in China right now, it is a case of working key relationships with the right set of senior politicians who are set to take control of the Politburo later this year, after the once-in-a-decade leadership transition has taken place. […]
EU Summit Solves Nothing
European LDPE spot prices at their lowest level since January 2010 By John Richardson THE EU Summit results might have bought a little more time, but as John Authers points out in this article in the Financial Times, “the result was the latest politically driven bounce for risk markets (including crude-oil prices and […]
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