These are, as always, my personal views and do not express the views of ICIS. Thanks By John Richardson RELATIONSHIPS between the US and China reached a major low point in May 2018 when details of the full scale of US demands were leaked to the Chinese. They required China to abandon its economic growth […]
Asian Chemical Connections
Higher Asian ethylene and polyethylene prices do not mean we are past the bottom of the downcycle
By John Richardson THE RISE in Asian spot ethylene prices is being cited as evidence of better downstream polyethylene (PE) supply and demand fundamentals. I am not convinced, partly because the ethylene spot market in Asia is so thinly traded that a myriad of unrelated factors could be behind the recent price increases. PE prices […]
Why President Trump, unlike with Iran, will find it harder to shift course on China
As always, these are my personal views only and do not represent the views of ICIS. Thank you By John Richardson A WILLINGNESS to change policy direction in almost the blink of an eye is one of the messages from this week’s geopolitical chaos. When many of us thought the US was about to […]
Asian PE and PP margins at lowest levels in at least five years and will go lower……
By John Richardson NOT since at least the beginning of 2014 have Northeast and Southeast Asian polyethylene (PE) and polypropylene (PP) margins been as low as they were for the week ending 29 November. We only began our margin assessments in 2014 and so last week’s margins may be lowest for an even longer period. […]
Asian polypropylene market heads for major 2020 downturn
By John Richardson THE ASIAN polypropylene (PP) market hasn’t been as bad as the region’s polyethylene (PE) market in 2019 because of much more limited increases in supply. Whereas the PE market has been flooded with new US production, especially in linear-low density PE (LLDPE), increases in PP output have been much lower. Not for […]
Asian polyethylene shutdowns? Once again, good luck with that idea
By John Richardson I was new to the game as I had only been analysing the petrochemicals business for 12 months. Hence, when a US industry executive told me that South Korean cracker-to-polyethylene (PE) plants would shut down, during the Asian Financial Crisis, I almost believed him. This was until I made my first visit […]
Europe to become much more self-sufficient in polyethylene because of sustainability
Yes, I know I promised to focus on Asia and its cracker-to-PE industry today and how the region will not see shutdowns that will make way for the big increase in US production. This will still be a theme of a later post. But it occurred to me, after my post on Sunday, that I […]
Environmental taxes on US polyethylene shipments to the EU seem inevitable
By John Richardson IT ALL seemed to make perfect sense at the time. Feedstock and financing were incredibly cheap and trade barriers kept falling. Although there were some faint and distant public rumblings about plastic rubbish, most of the public and the majority of legislators were not bothered about the issue. The global economy was […]
The global polyethylene paradigm shift of permanently weaker demand
By John Richardson MALCOLM GLADWELL, in his very thought provoking book The Outliers, writes about what we think is gut instinct, but is instead the result of a minimum of 10,000 hours of doing something: Sub-conscious expertise that tells us how to think and react in most situations because we’ve been here before. So, when […]
Shift in supply chains away from China adds costs, complexities and risks for petrochemicals
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 […]