By John Richardson US VICE president Mike Pence made a barely reported speech on 4 October in which his big theory was that Bill Clinton, George W Bush and Barack Obama misread China. Mr Pence said that the nation they embraced as a partner was instead a competitor. It is important that you read the […]
Asian Chemical Connections
China polymer growth at risk of 8.6m tonne decline on trade war
By John Richardson THERE is no other country or even region in the world that comes anywhere close to being as important to the global polymers industry as China, as the above chart reminds us. From end-2017 until the end of 2021 in seven of the major synthetic resins – PE, PP, PS, EPS, ABS, […]
Acrylonitrile butadiene styrene trade war disruptions
By John Richardson BECAUSE CHINA is such a dominant player in finished goods manufacturing, US tariffs on Chinese imports as part of the trade war will have major negative effects upstream across a wide range of petrochemicals and polymers and across a wide range of countries. The reason is of course that petrochemicals are needed […]
US styrene another petchems sector at risk from trade war
By John Richardson THE US decision to pick a fight with China over trade and geopolitical influence could backfire very badly from the perspective of new US investments in petrochemicals capacity – most notably polyethylene (PE) and ethylene glycols (EG). The data tell is that many billions of dollars of investments in new plants will […]
Middle East, India, SEA petchems winners in new trading blocs
By John Richardson JACK MA, the founder of Alibaba, said of the US/China trade war, “It’s going to last a long time, maybe 20 years. It’s going to be a mess. It’s not a trade war, it’s about competition between two countries.” I believe that the world is set to be split into two trading blocs, […]
How Lehman Bros reshaped China and the global PE business
By John Richardson MOST of the analysis on the tenth anniversary of the Global Financial Crisis (GFC) focuses on the effects on Western economies and societies. Economic inequality has risen since 2008 resulting in the rise of populist politics, is a very common theme. But almost entirely overlooked is the huge effect that the GFC […]
PE Margins Fall As Trade War Threatens Two Entirely Separate Trading Blocks
By John Richardson LET’S FIRST of all take a close look at what the above chart is telling us about the damage already done to polyethylene (PE) margins before considering what could happen next. US high-density PE (HDPE) margins are 47% lower in the year-to-date versus to 2017 and low-density (LDPE) margins are 45% lower. […]
The Three Essential Oil Price, Economic Growth Scenarios For Petchems
By John Richardson ALL the excitement over the positive impact of US tax cuts should be placed very firmly in this context from an early July Reuters article: US budget analysts generally look at the impact of tax changes over a ten-year period. The tax cuts approved at the end of 2017 were estimated to […]
China PP Imports To Halve By 2025 Or Turn Into Exports
By John Richardson CHINA IS accelerating its drive towards at the very least much greater PP self-sufficiency by 2025. There is also a credible second scenario where China becomes a significant exporter by that same year, most logically to the Asia and Pacific (A&P) region due to proximity and what will be stronger geopolitical and […]
Increasing Risks Of Financial Crisis By End-Year
A sign that the central bank “put option” has come to an end By John Richardson EVER since 2008 there has been been a fantastic “put option” which has made the fortunes of many financial and commodity market investors. This involved assuming that every time bad economic news emerged, central banks would ramp-up economic stimulus. […]
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