In November 2021, the premium for overseas PP injection grade prices over prices in China reached a historic peak of $408/tonne. But in 1-18 November 2022, the premium was $113/tonne. Premiums have fallen in every month since April this year, resulting in a decline in China exports.
Asian Chemical Connections
The multi-million dollar polymers opportunity: continued big regional price differentials
By John Richardson POLYMER BUYERS outside northeast (NEA) and southeast Asia (SEA) have a big opportunity to save millions of dollars on procurement costs during the rest of this year through purchasing more from the two regions. The opportunity has arisen because I believe that NEA and SEA polymer prices will remain very cheap relative […]
Global polyethylene oversupply, the highest in 19 years, hasn’t gone away
By John Richardson BRENT crude futures surged by 80% during the second quarter and enjoyed their best three months since 1990, when, during the first Gulf War, they jumped by 142%. The market, as I discussed last month, has been heavily supported by China buying lots of oil when prices were cheap. As Reuters reports, […]
China Lending Bubble Adds 4.7m Tonnes To Polyethylene Consumption
By John Richardson THE IMF produced a very interesting study earlier this month, in which it estimated that if it had not been for China’s giant economic stimulus programme the country’s real GDP growth would have averaged only 5.3% per annum during the five years to 2016. Instead, however, the IMF estimates that China’s economy […]
The Data Is Still Staring Everyone In The Face
By John Richardson I CONTINUE to worry that people are only paying attention to when the Fed will raise interest rates. As a result, they are missing the far bigger story, which is the slowdown in both developing and developed economies resulting from events in China. The good news is that this view is gaining […]
China Pulls Back From Funding Other Emerging Markets
By John Richardson IT important to be relentlessly realistic about the risks no confronting emerging markets in general, now that China is focusing much more on its own internal problems and needs. One of these risks – reduced funding of infrastructure and other projects in the emerging world by Chinese banks – was highlighted in this […]
China Politics
In the last of our series of blog posts on some of the major challenges facing China’s economy over the next 12-18 months, we look at politics. By John Richardson THE outcome of the battle over China’s economic direction is, of course, of crucial importance to the world economy. It would be comforting […]
China’s Luxury Goods Risk
By John Richardson THE “luxury end” of China’s polyethylene (PE) market is being heavily targeted by overseas producers and the results so far have been pretty spectacular, according to one of the producers. “The annual growth in demand for higher value grades has been tremendous – two times GDP,” said a senior executive with […]
Greek Election Results Change Nothing
By John Richardson HOW long will the relief rally last in oil and equity markets following the Greek election results? Sadly, the answer is not long, because difficult discussions lay ahead for the New Democracy party as it tries to form a government. Greece, also, remains broke and so the Euro crisis is far from […]
Latin America focused on new investments
By Malini Hariharan The blog has been scanning ICIS news reports from the 31th Latin American Petrochemical Association (APLA) conference in Buenos Aires to gauge the mood at the event. Participants appear to be sanguine despite the global economic turmoil with talk focused on upcoming investments. Braskem is the forefront. Its joint-venture project with Idesa, […]
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