By John Richardson THE above chart should give you a feeling of déjà vu. In early 2014, Chinese lending growth started to decline and by September of that year, broad recognition of the extent of the decline was behind a sharp retreat in global commodities prices as the global economy also slowed. History very often […]
Asian Chemical Connections
China Scrap Plastic Crackdown: 1-2% Boost To Polyolefins Demand
By John Richardson THE DECLINE in China’s imports of scrap or waste plastic and cardboard could boost 2018 virgin polypropylene (PP) consumption in China by some 1% above our base case. Meanwhile, polyethylene (PE) demand may be 2% higher For details on what this would mean in terms of tonnes, subscribe to our monthly Asia […]
Why China Can Become Major Polypropylene Exporter By 2025
By John Richardson ONE of the main topics of debate in the global polypropylene (PP) business is whether or not China will become entirely self-sufficient. The pessimists, or rather I would say the realists, go a step further. They believe that there is every chance that China will become a significant exporter. The final result […]
Asian Polyolefins Markets Still Indicate Economic Slowdown
By John Richardson ANOTHER week has led to another fall in Asian polyethylene (PE) and polypropylene (PP) prices despite higher naphtha feedstock costs on stronger crude oil. Pricing has been weak since the Lunar New Year Holidays, (15-21 February). Market participants had expected the opposite on a recovery in demand following the holidays and tight […]
Digitisation Will Transform Petchems As Plant Reliability Increases
Global volatility in pricing will also be greatly reduced as unexpected outages largely become a thing of the past By John Richardson EUROPEAN polyolefins have painful memories of 2016 because it was a year of major supply shortages. Polyethylene (PE) production in the three major grades was down by an average of 2.3% compared […]
US Polyethylene: Even Without Trade War, $6.2bn Of Sales In China At Risk
By John Richardson AS THE number of exemptions from the new US steel and aluminium tariffs grow for Americas “friends”, the direct impact of the tariffs might end up being fairly minimal. So far, Canada, Mexico and Australia have been let off the hook. But the national security basis upon which the tariffs have been […]
Global Trade War: $12.4bn of US Petchems Exports At Risk
By John Richardson THE CUMULATIVE negative effect on global GDP as more and more countries became involved in a trade war is estimated by the above table on the left, from a research paper by economists as the Australian National University. The table shows the impact of each country imposing an extra 10% tariffs on […]
China’s Polypropylene Market: The Big Inland Growth Opportunities
By John Richardson A CONVENTIONAL WAY to assess the pace of polymers demand growth in a developing country is to assume links with historical patterns in developing countries. How long did it take the US, Western Europe and other developed economies to reach their current level of per capita consumption? From these rates of increase, […]
Stock Markets: Real Implications For Petchems and Risks Of A “Cynical Bubble”
By John Richardson WHEN stock markets are rising, the proverbial garden can look as if it is blooming with summer flowers without a weed in sight. But the underlying data suggest wealth inequality is still a major issue in the US, with the inequality creating iconoclastic politics in the US that continue to threaten a […]
Asian Petchems Profits Could Test Historic Lows In 2018
By John Richardson THE ASIAN steam cracker business has struggled to pass on higher oil prices as the above chart further underlines. As you can see, high-density polyethylene (LLDPE) injection grade spreads including selected co-products have slipped over the last few months. Spreads are a rough but still useful measure of profitability, and so tell […]