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Asian Chemical Connections

Seeing Through The Smokescreens

By John Richardson CHEMICALS traders and the financial community, quite obviously, benefit enormously from volatility. Thus we have seen certain chemicals markets being talked-up by the trading community on the basis that the post-Lunar New Year period will see a surge in demand. Equally, the job of the financial community at the moment is to […]

Forty Five Minutes On China

By John Richardson CHINA’S GDP (gross domestic product) growth could fall to only 6.6 percent this year compared with 9.2 percent in 2011, warned Patrick Chovanec, an economist at the Tsinghua University’s School of Economics and Management in Beijing in this Reuters article. Even this very-low rate of growth for China will only be achieved […]

The Fragility Of the Recovery Story

By John Richardson A VERY illuminating discussion with a Shanghai-located sales and marketing manager for a major Asian polyolefin producer reveals how the post- Lunar New Year “recovery” story being sold by the investment community is on even more shaky ground than we at first thought. Three points worth highlighting, before we publish verbatim what he said, […]

Chems Trade Protectionism On The Rise

By John Richardson TRADE protectionism in chemicals is set to rise during 2012 as a result of a weaker global economy, warned a trade lawyer who specialises in the chemicals industry. “There was a 30-40% increase in the total number of anti-dumping cases in Europe in 2011 over the previous year, and I think this […]

Difficult Year For Naphth-based PE

By John Richardson THE first quarter of the 2012, and very probably the rest of the year, look likely to be very difficult for Asia’s naphtha-based polyethylene (PE) producers as a result of more competition from the Middle East in the vital China market. The other big negative factor looks likely to be Chinese demand […]

Investors Predict Strong Petchems Rebound

By John Richardson POLYETHYLENE (PE) inventory levels are thought to be so low at the converter end of the business in China that a case is being made for a strong recovery in demand and pricing post-Lunar New Year. A further factor behind the anticipated rebound are forecasts of further credit easing by the Chinese […]

Resolving China’s Bad Debts

By John Richardson IS China facing a bad debt crisis as serious, or perhaps even worse, than sub-prime in the US and sovereign debt in Europe? Despite all the bland reassurances the blog keeps hearing from chemical industry executives about the tremendous growth prospects in China, this is a valid question as we try to assess […]

Wile E Coyote And China

By John Richardson THE blog, a bit like Wile E Coyote who always fails to catch Road Runner, has been amazed in recent weeks at certain people in the chemicals industry who, in public at least, fail to grasp the complexities confronting China’s economy in 2012. We wish that our experience would, at least for some […]

Conventional Thinking Revisited

By John Richardson CONVENTIONAL thinking is that when you have a strong feedstock advantage, you should go ahead and build more petrochemicals capacity on the assumption that growth will eventually be sufficient to absorb volumes. Hence, several more green-field crackers would be announced in the US based on low-cost ethane, butane and propane via shale […]

The Risks For US Petchems

  By John Richardson THE US petrochemicals industry might be in danger of being lured into old thinking about the future direction of the global economy as a result of abundant shale gas. Despite the short-term markets gloom which we described yesterday, several industry executives and observers who we spoke to on the sidelines of […]

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