By John Richardson THE NEXT big wake-up fall for global financial markets and the chemicals industry is likely to ring loud from the autos market. Expect global auto sales growth estimates for 2019 to be revised downwards with a steep sell-off in the share prices of the major car producers, as everyone realises that sales […]
Asian Chemical Connections
Deep understanding of inland China essential for tracking 2019 slowdown
By John Richardson CHEMICALS companies are at great risk of getting Chinese demand very badly wrong in 2019 if they rely too heavily on flawed government data. This article from the South China Morning Post is another example of the long-standing practice of official data underestimating economic weakness when a downturn is taking place. The […]
Latest global chemicals production data indicate recession likely very close
By John Richardson ONE OF THE useful things about chemicals industry data is that they are an early indicator of macroeconomic trends because chemicals are of course the raw materials for so many finished goods. If demand for chemicals rises this serves as an early indicator of stronger sales of TVs, smartphones, autos, computers and […]
China Auto Sales Slowdown Points To Lower Polypropylene Growth
By John Richardson AUTOMOBILES are, of course, a key end-use market for chemicals and polymers and China has been by far the most important global market in autos since the Global Financial Crisis (GFC). Chinese total vehicles sales soared from 6.3m in 2007 to 24.7m last year. Meanwhile, analysis from Paul Hodges shows that sales […]
The Future For China Auto Sales
By John Richardson The distance from end-use markets didn’t matter for chemicals and polymers producers during the 2008-2013 credit surge in China because, as we said yesterday, demand was so good that few people were willing to ask too many awkward questions. But now the questions need to be asked. One of the questions we […]
China’s Post-New Year Credit Squeeze
In the first of a series of special posts on how China’s lending environment is set to change, we focus on the murky world of shadow banking. We will return to shadow banking, and to other “grey” areas of financing, in later posts in order to assess what role they have played in chemicals and […]
China Auto Sales Point To Long-term Shift
By John Richardson The impact of Chinese government policy adjustments on petrochemicals demand was further highlighted late last week, when auto-sales figures for January-February were released. Sales declined by 4.4 percent, the worst two-month start for the industry in seven years, with local-brand sales falling by 17 percent. This is sure to dampen the mood […]
Middle East Still Confident For Now
By John Richardson Confidence among Middle Eastern petrochemical producers remains high because they obviously now that as long as oil prices do not collapse they will continue to make excellent money, said a chemicals analyst. The blog believes that there is a very strong chance that crude will collapse to as little as $25 a […]
Why China PE Demand Will Not Grow In 2011
By John Richardson THE blog hears that some industry observers are persisting with the Supercycle theory for petrochemicals based on “decoupling” – i.e. emerging markets will compensate for any new recessions in the West. We find this baffling as evidence points to a lost year of growth in China. The prospects for next year seem […]
China Auto Market Provides Clear Evidence
By John Richardson DESTOCKING is obviously not the main driver of the decline in China’s polyolefins market, despite what a dwindling band of optimists are still arguing. The glaringly transparent reason for the fallacy of the fading belief is a decline in key end-use markets for polyoleifins – and for other polymers and chemicals. Today […]
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