By John Richardson AS PETROCHEMICALS and other manufacturers scramble to relocate their businesses away from China in order to compensate for the trade war, they are discovering that there can be no replacement for China. China has been building up its global manufacturing dominance since as early as the 1980s. In the process it has […]
Asian Chemical Connections
China’s polyethylene indigestion persists as margins point to major downturn
By John Richardson CHINA’S POLYETHYLENE (PE) market continues to display signs of chronic indigestion. Significant overstocking persists with Northeast Asian integrated naphtha-based PE margins pointing to the weak start of the market with conditions are set to deteriorate. The core of the problem is that Chinese growth isn’t going to be anywhere near strong enough […]
The US places heavy bets on LLDPE at a time of demand erosion
By John Richardson IT IS a remarkably single product-focused strategy given the exposure of linear-low density polyethylene (LLDPE) to demand erosion from the global plastics rubbish crisis. Looking across the three grades of PE, the US will end up with a 33% global share of net exports (exports minus imports) amongst the world’s net export […]
Surge in US polyethylene exports occurs as China growth slows, Asian margins turn negative
By John Richardson PERHAPS ONE could argue, but I certainly wouldn’t, that in a perfect world the extraordinary rise in US polyethylene (PE) exports, which are detailed in the chart on the left, would have just about found a comfortable home. But when has the world ever been perfect? It certainly isn’t today: The IMF […]
China PE overstocking at above a million tonnes as Beijing struggles to boost economy
By John Richardson EVEN IF our base case growth rate* for PE in China in 2019 proves to be correct the H1 data still suggest excess inventories of 755,000 tonnes (click here for a post explaining the methodology). As the China economy further decelerates due to the trade war and domestic economic problems, I believe […]
China trade war duties on US LDPE “very likely” as global recession concerns grow
By John Richardson IT IS very likely that China will impose 25% additional imports duties on LDPE in response to the latest US escalation of the trade war, market sources have told me this week. This would add to the 25% duties that have been in place on US HDPE and LLDPE cargoes since August […]
Trump latest tariffs risk global recession, 3.8m tonne lost PE demand
By John Richardson PRESIDENT Trump is playing with fire as a result of his plan to impose 10% import tariffs on a further $300bn of Chinese imports. This threatens to push the world into a global recession. (I hope you took notice when I warned you to expect very little from last week’s trade talks). […]
Trade war dangers for US polyethylene re-emerge as talks appear to flounder
By John Richardson ONLY YESTERDAY just about everyone I spoke to in the polyethylene (PE) industry believed that the US and China would reach a trade deal by their 1 March deal. I agreed with them, although I kept cautioning during discussions that any trade deal would be paper thin […]
HDPE Premium Likely To Fade
By Malini Hariharan High density polyethylene’s (HDPE) premium over linear low density PE (LLDPE) is likely disappear in the second quarter reversing a trend that has lasted for nearly a year. LLDPE supply is getting tighter with few capacity additions due this year. Additionally plant turnarounds in Asia and the Middle East are also likely […]
Hits And Misses For Indian Projects
By Malini Hariharan The Indian project scene continues to see some hits and misses. Among the projects on track, sources at Gail (India) told the blog last week that expansion of its Pata cracker and a new polyethylene (PE) plant will be completed in Q1 2014. Mechanical completion is due in December 2013,, while commissioning […]
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