China’s PP net exports could be more than 2m tonnes in both 2024 and 2025. This would likely make China the fourth biggest exporter in Asia and the Middle East.
Asian Chemical Connections
China PP demand could grow by 3% in 2023, down from the 2000-2020 average of 10%
THE EARLY DATA suggest that China’s polypropylene (PP) demand could grow by 3% in 2023. This would be in line with the base case forecast I provided in February.
China PE demand growth in 2023 could be only 1% versus forecasts of 5%
Early data suggest China PE demand growth in 2023 will follow the trend since 2021 of much, much lower growth.
China PE and PP downcycle a long, long way from being over
The average China PE spread between 1 January and 17 March this year was just $290, the lowest since our assessments began.
Between 2000 and 2021, before last year’s collapse, the annual spread averaged $532/tonne. This means that until spreads increase by 83% from their current levels, there will have been no recovery..
US PE exports in 2023 are not inevitably going to increase
A SCENARIO-BASED approach is essential to understand US PE exports in 2023, based on non-plant economic factors
Why China’s HDPE demand could decline in 2023-2040
China’s cumulative HDPE demand under the downside scenario would be 97m tonnes lower than our base case. in the above chart
How to manage risks and opportunities during maybe the worst-ever PP downcycle
During this downturn, razor-like focus on fluctuating netbacks and supply and demand among all the different countries and regions will allow producers to ensure that they don’t make product for markets where there is no demand, while ensuring that they take maximum advantage of many brief periods of stronger demand and pricing.
Global oversupply of petrochemicals to hit 218m tonnes in 2023 – the highest in any other year since 1990
Capacity exceeding demand is forecast to reach 218m tonnes this year from a 1990-2022 annual average of 76m tonnes.
Why China’s 1990-2022 PP consumption could have been 300m tonnes lower without the benefit of “one off” historical trends
IF China had been a typical developing economy, as the above chart illustrates, its cumulative 1990-2022 could have been 300m tonnes smaller. As history moves forward,this suggests that China’s long-term demand growth could turn negative
SEA Asia PE market dragged lower by China now container freight rates have fallen.
The decline in container freight rates has opened the SEA PE market to more competition – pulling the region’s spreads closer to the record-low China levels
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