China’s Dalian polymer futures market continues to have a major influence on regional, and global, polyethylene markets. But November’s trading volume was lower than a year ago, at 25 million tonnes. This is the first negative annual growth since volume took off in June last year. Last month, the blog noted a comment from LyondellBasell […]
Chemicals and the Economy
2010 may see seasonal demand patterns resume
The American Chemistry Council’s excellent weekly report contains some potentially good news on the outlook for Q1 demand. Its detailed analysis of US polymer markets (above) suggests customers are currently reducing their inventories. CFO’s presumably assume that the main impact of the housing/auto stimulus programmes is now finished, and are no doubt keen to keep […]
China’s polyethylene imports surge 63%
The above chart, courtesy of trade data experts GTIS, shows the extraordinary leap in China’s polyethylene imports this year. They have surged 63% January – October in 2009 (blue bar) to 6.7 million tonnes versus 4.2 MT in 2007 (green bar) and 2008 (orange bar). Many countries have seen massive rises. Iran exported 404kt vs […]
Floating oil storage increases again
Oil markets are looking increasingly uncertain as we come to year-end. One example of this is a new survey of floating storage by oil brokers, Gibson. This found 42 ships in use, up from the 29 seen in September. Normal levels are just 5 – 7 vessels. Another is OPEC’s weaker discipline on quotas, which […]
OECD Indicators paint a confusing picture
Leading indicators are useful reference tools, but sometimes they can also mislead. The chart above, from the ACC’s excellent weekly report, seems to provide a good example of this problem. The blue line shows the official Leading Indicator for the OECD area plus the 6 major non-OECD countries. It suggests that a strong recovery is […]
IEA, OPEC, worry about high oil prices and CO2
The new World Energy Outlook from the International Energy Agency (IEA) spells out two major challenges. It: • “Identifies higher oil prices, coupled with the downturn in oil sector investment, as a serious threat to the world economy, just as it is beginning to recover“. • Suggests that “a profound transformation of the energy sector” […]
Wal-Mart sees global price deflation continuing
The blog regards Wal-Mart and other major retailers as excellent leading indicators of trends in the wider economy. It was therefore concerned to see CFO Tom Schoewe reporting today that Wal-Mart continues to “operate in a very challenging economy“, where the key driver is to provide “the lowest prices to our customers around the world.” […]
China’s oil imports not driven by domestic demand
A key driver for the rally in crude oil markets has been the increase in China’s demand. The assumption has been that this confirms economic growth is recovering strongly. Crude oil imports have certainly been rising since Q1, and have recently averaged 500kbpd more than 2008. Refinery runs have also been higher. However, new analysis […]
US unemployment rate now 10.2%
The US accounts for 23% of global GDP. Its economy is 3 times larger than the No 2 country, Japan. And most critically for the chemical industry, 70% of US GDP is consumer-based. Developments in US housing/construction, auto and electronics industries are therefore the biggest single influence on global chemical sales. In turn, the level […]
Computerised trading dominates crude oil markets
The purpose of liquidity in financial markets is to enable price discovery. But when super-fast computers take over the trading, that purpose disappears. Instead, we have today’s “correlation trading“. Olivier Jakob of PetroMatrix demonstrates this with the above chart, which shows Tuesday’s detailed trading patterns in WTI and the Dow Jones Index. Clearly, they are […]
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