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 […]
Asian Chemical Connections
China’s economy is not recovering say petrochemicals markets
By John Richardson IF YOU only read the financial press and follow the stock markets you can be entirely forgiven for thinking that China’s economy has turned around as a result of huge injection of economic stimulus. But anyone whose job it is to follow petrochemicals markets should know that the jury is still out […]
Re-assembly Job No 2: China Local Govt Revenues
By John Richardson THERE are personal reasons why local government officials in China might effectively resist the boldest economic reform agenda since 1978. Career advancement is one such reason, as is making money on the side. “By building a large dam, road or giant housing complex [or a new chemicals plant], an official can boost […]
Everything Is Going To Plan
By John Richardson So far so good – everything is going to plan. The flash Markit/HSBC China Purchasing Managers’ Index (PMI) for May fell to 49.6, slipping under the 50-point level demarcating expansion from contraction for the first since October last year and sending Asian financial markets sharply lower. But, crucially, as Reuters pointed out in this article, […]
China Investment Lowest Since 2002
By John Richardson THE chart above indicates the extent to which polyethylene (PE) price rises over the last few weeks have failed to adequately compensate for higher feedstock costs. Last week saw prices edge up by a further $10-40/tonne, according to ICIS pricing. “The majority of buyers have accepted higher September offers, but we know […]