By John Richardson WE NOW HAVE enough data to make some firm conclusions about what the Chinese polyethylene (PE) market will have looked like in 2021. We can also make some early estimates about the shape of the market in 2022. The slide below details what the ICIS apparent demand data for January-October 2021 (our […]
Asian Chemical Connections
Benzene, the need for a new global Industrial Revolution and the big challenges that lie ahead
By John Richardson THE CHART BELOW shows that 60% of global benzene production in 2021-2040 is forecast to be made via technologies linked to refining units that also make gasoline components. The 60% includes a 33% share for catalytic reformers that make toluene, mixed xylenes (MX) and benzene, referred to collectively as reformate. In the […]
Global polypropylene could also move from inflation to deflation in Q1 next year
By John Richardson WE ALL NEED TO ASK ourselves whether the global patterns in polyethylene (PE) and polypropylene (PP) pricing and margins that we have seen over the last year represent a long-term divergence in global markets or something temporary. As discussed on Monday, when I examined linear low-density PE (LLDPE) market (and the same […]
Global polyethylene could move from inflation to deflation by as early as Q1 2022
By John Richardson THE BALTIC DRY INDEX, one of the excellent barometers of overall economic activity, was late last week at its lowest level since June on a slowing Chinese economy, easing congestion at Chinese ports and a fall in Chinese coal imports (more on this in a moment). “The index was around 1,000 a […]
As China coal shortages end, polyolefins margins reach historic lows on oversupply
By John Richardson AGAIN, DON’T say I didn’t tell you. In my 11 October blog post, having talked to people who know what they are talking about, I flagged up the possibility that China’s energy shortages could be fixed a lot quicker than many people were suggesting. Those in the know about China told me […]
Dip in Chinese PP exports only temporary with Q1 2022 resurgence looking likely
By John Richardson TRADE DATA when combined with price assessments, supply and demand estimates and market intelligence is the modern-day equivalent of alchemy with a rather important difference: we can genuinely convert numbers and conversations with the market into gold, unlike the bogus science of alchemy. A great example is the chart below, the first […]
Global polyethylene supply could lengthen, becoming a buyers’ market, sooner than many people think
By John Richardson RARELY, IF EVER, have events felt so bafflingly complex in the global polyethylene (PE) business. Take as an example the chart below listing the factors that have reshaped demand since the beginning of the pandemic. Let’s go through these factors one by one, box by box. It is reasonable to assume, starting […]
China could either see net imports of 63m tonnes in 2021-2031 or net exports of 18m tonnes!
By John Richardson CONFUSED BY the above chart? Once again I certainly hope so, provided confusion is not followed by blind paralysing panic. The chart, showing three scenarios for China’s net polypropylene (PP) imports in 2021-2031, follows last week’s chart of 2021-2031 high-density polyethylene net imports. Confusion is valuable because we need to go back […]
New China HDPE import scenarios for 2021-2031 in the context of Common Prosperity
By John Richardson IF YOU THINK that forecasting the direction of China’s petrochemicals demand has become complicated enough because of Common Prosperity, the new complexities around demand pale into insignificance compared with the tangle of fresh variables shaping local capacity growth. The above slide is just my back-of-the-envelope attempt to chart some of […]
China polypropylene demand growth continues to disappoint as new capacity uncertainties increase
By John Richardson CHINA’S POLYPROPYLENE (PP) demand will very likely still grow in 2021 despite what has been a disappointing year relative to expectations. My latest estimate is for consumption to grow by 3% over last year. This is based on China Customs net import data and our local production estimates for January-September 2021. As […]
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