By John Richardson YOU might be familiar with the phrase “putting all your eggs in one basket”. It is the kind of phrase that you learn at your mother’s knee, and yet CEOS seem to have forgotten what they were surely taught from a very early age. The chart below should take your breath away. It […]
Asian Chemical Connections
Getting Started On Rebuilding Your Company Strategy
By John Richardson THE New Normal is a journey of discovery, as my colleague Paul Hodges pointed out in his blog post yesterday. As this latest global economic crisis develops, it is vital that we start the journey otherwise many of us will end up out of work. Some chemicals companies will simply not survive […]
China Coal-To-Olefins “A Net Water Producer”
By John Richardson IT has become the accepted wisdom over the last few years that the coal-to-olefins (CTO) process in China consumes a lot of water. This theory has been expressed in so many conference papers and in research papers that this “truism” is part of just about every discussion on the viability of CTO […]
China’s Polyolefins Supply Surge: The Bigger Picture
By John Richardson ON paper, the polyolefins supply surge in China during 2014 is huge as it involves: Some 2.2m tonnes/year of new polyethylene (PE) capacity, according to this ICIS news article. No less than 4.1m tonnes/year of new polypropylene (PP) capacity. To put this into context, China’s total effective capacity was estimated by ICIS […]
China: Starting All Over Again
By John Richardson WE NOW know is that China’s real GDP growth is probably heading into negative territory, perhaps by as early as Q4 – and if not by then, certainly in 2015. But in order to fully answer “how bad will it get before it gets good again?” we need to also evaluate just how […]
Global Petchems Industry Must Prepare For More Difficult 2015
THE direction of Asian polyethylene markets, once again, serves as a good guide for the overall global petrochemicals industry. Producers in every region and in every sector of our industry should, therefore, take note of what follows. They must prepare for what we worry will be a much more challenging 2015. By John Richardson […]
Eight Steps To Realising This Will Be Worse Than Lehman Bros
By John Richardson WE are going through a process of realisation at the moment. It is not a linear process – i.e. not all people will be at the same stage. Equally, chemicals and other company executives will move backwards and forwards between different stages in the eight-step process. We can only hope that the […]
Broad Commodities Sell-Off Threatens Petrochemicals
By John Richardson IRON ore prices are now down by nearly 40% so far this year to a level not seen since September 2009. As for crude oil, Brent has now dipped below $100 per barrel, for the first time in over a year. WTI is trading around $92 per barrel, a 16-month low (see the […]
Iron Ore and Petrochemicals Share The Same Delusions
By John Richardson BACK in January we wrote: “As China’s investment growth model is unwound – for economic as well as social reasons – iron ore prices [will] decline significantly, leading to the failure of the smaller mining companies and some of the service providers. This could happen just as a lot more iron-ore supply […]
Asia Chemicals Will Need To Cut Operating Rates
By John Richardson THE above chart, from Paul Satchell’s latest Volume Proxy*, indicates that the downturn in Asian chemicals markets has become more entrenched. “The continued decline in the Asia line lends further support to our earlier assertion that the peak manufacturing season in China is likely to disappoint,” writes Satchell, a UK-based chemicals analyst […]
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