China’s real estate rescue only involves shoring-up lenders. The property bubble will not and cannot be reflated. Most of the zero-COVID rules remain in place, and will likely stay in place well into 2023
Asian Chemical Connections
China’s PP market and Zero-COVID: why 2022 net imports could fall to just 300,000 tonnes
THERE IS NOT MUCH point in carrying out economic stimulus if people can’t spend the extra money. This is the dilemma China faces as it maintains its Zero-COVID policy that it is now affecting some 400m citizens. This makes all the talk in recent weeks of a stimulus-led economic turnaround largely irrelevant.
With Common Prosperity set to dominate 2022, here is some essential history
By John Richardson THERE IS ONLY one slight problem with the argument that developing world demand is behind the boom in petrochemicals demand over the last 20 years: the data. Sorry to begin the year on a rather sarcastic note, but this is unfortunately a drum I feel I need to keep banging to support […]
Here is your guide to Asian and Global HDPE markets in Q4 this year and in 2022
By John Richardson THE COMING COLLAPSE of China, as I’ve discussed is before, is like commercially viable nuclear fusion and peak oil – perpetually 10 years away. But what seems evident to me is that over the next six to 18 months, as China transitions to what I believe will be a successful new and […]
Whether Beijing blinks over Evergrande is the biggest issue for global petchems
By John Richardson WILL BEIJING blink? The answer to this question could pretty much set the direction of the global petrochemicals industry over the next six to 12 months. In my view, the question over whether the Chinese government will relax its clampdown on local real estate, which Bank of America estimates accounts for 28% […]
China NPC Underlines Inflation Focus
The course of true love never runs smooth…..Happy China couples get divorced and then plan to remarry in order to avoid new property tax Source of picture: Quirky China News/Rex Features By John Richardson China will see “large inflation pressure in the second half of the year,” said a People’s Bank of China official on the […]
China’s Can-Kicking Temptation
By John Richardson THE China bulls will no doubt claim that the shadow-banking system isn’t a systemic risk to the country’s financial system and thus, of course, the world economy and the investment strategy of many chemical companies. They might be right. Or they might be wrong. Assuming they are right is dangerous. “The economic slowdown […]
Demand Is The Thing
By John Richardson In the second of a series of three blog posts, we gauge the reaction of the market to last week’s sharp decline in polyolefin prices. Yesterday, we focused on the Middle East. Today, we interview a source with a Western-headquartered global polyolefin producer. He told us: “I have a dreadful feeling that […]
China Economic Optimism
By John Richardson ECONOMISTS think China’s growth has bottomed out, thanks to unexpectedly strong March bank lending. They also think that interest rates will stay low for a long time, even if rates cannot be cut because of the inflation problem. New loans in March totalled Rmb1trn ($159bn), more than banking analysts had expected. This renewed […]
It’s Always Helpful To Have A Plan
By John Richardson THERE are four major reasons why the first three quarters of 2011 have been excellent for chemicals companies, which are: 1.) Strong co-product credits have supported what have been weak commodity-grade polyolefin markets since March of this year (higher-value grades, such as co-polymer grade polypropylene for auto applications, have been better) 2.) […]
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