By John Richardson NOW THAT we have the final data for 2020, for last December, we can complete the picture of what was a truly extraordinary year. As I’ve been highlighting since last August onwards, a pandemic-related shift in demand led to a much stronger Chinese polyethylene (PE) market than just about anyone had expected. […]
Asian Chemical Connections
Vaccine nationalism and lack of debt relief remain major threats to petchem growth
By John Richardson WE LIVE in a highly interconnected world as this statistic underlines: of the $18tr worth of goods that were traded last year, intermediate goods or components of finished goods represented $11tr, according to the Organisation for Economic Cooperation and Development. In the key automotive, textile, retail and construction petrochemical end-use industries, many […]
China’s economic dominance carries many short and long-term risks for petrochemicals
By John Richardson JUST 5% of US companies with revenues of more than $500m plan to relocate operations out of China, according to the latest survey by the American Chamber of Commerce in Shanghai. This partly reflects highly networked manufacturing clusters, wrote the Australian Strategic Policy Institute in this excellent article. “Automotive and electronics clusters […]
New China pandemic outbreak China single-biggest risk for global petchems in 2021
By John Richardson CHINA FACES another test of its pandemic control capabilities because of new outbreaks in Hebei and Heilongjiang provinces. On Wednesday, China recorded its first coronavirus death in eight months in Hebei. From an economic perspective, the good news, as CNBC reported, was that “Heilongjiang accounted for just over 1% of China’s GDP […]
China polyethylene imports set to remain strong in 2021 despite big local capacity growth
By John Richardson IT WAS a tremendous year. China’s 2020 polyethylene (PE) demand growth over 2019 averaged 10% across the three grades. This comprised a 13% increase in demand for high-density PE (HDPE), a 2% decline in demand for low-density PE (LDPE) and a 13% rise in linear-low density PE (LLDPE) demand, according to my […]
Sustainability means reducing carbon emissions as well as plastic waste
By John Richardson THIS IS VERY much a personal plea to our industry about what I see as the biggest challenge we face in 2021 and beyond: carbon and other greenhouse gases. “We need to rebrand climate change as the climate crisis,” a source who works for an oil, gas and petrochemical company has been […]
Assessing global PP prospects next year: seeing the simplicity through all the complexity
By John Richardson IT COULD be very complicated and yet, as the chart above indicates, it might instead by extremely simple. Here I use the example of polypropylene (PP), but similar complexities and one simplicity also apply to the paraxylene and styrene markets and all their downstream derivatives, as I shall discuss in later blog […]
Risks ahead for global polypropylene much greater than for polyethylene
By John Richardson THERE SEEMS to be few risks ahead for the global polyethylene (PE) market over the next five years. The internet sales boom, despite all the talk about using less plastic for sustainability reasons, promises to provide strong support for consumption. The average internet sale is dropped 17 times before delivery, providing a […]
Polyethylene demand boom should not obscure focus on major changes in industry fundamentals
By John Richardson IT WASN’T supposed to be like this. We firstly had the unprecedented increases in global capacity that threatened a deep downcycle. Then we had the accepted wisdom, a wisdom I bought into, that the pandemic would dig a giant hole in polyethylene (PE) demand. As recently as March, few producers would have […]
Sustainability, the pandemic, demographics and geopolitics – how petchem companies respond will define their success
Just to stress again that this blog represents my personal views and not those if ICIS. By John Richardson YOU WILL NEED to constantly debate the details of the megatrends as they will very often change entirely. And whilst today’s four megatrends – sustainability, the pandemic, demographics and geopolitics – will remain unchanged, their relative […]