China used to be the manufacturing capital of the world. It would buy raw materials, and sell finished products to the West. But these volumes are now in decline. The West’s ageing populations already own most of what they need, and their incomes are reducing as they enter retirement. So China’s business model is changing. […]
Chemicals and the Economy
Saudi plans to transform Aramco to energy /industrial company
“Within 20 years, we will be an economy that doesn’t depend mainly on oil“. With that one statement, deputy Crown Prince Mohammed bin Salman (pictured above), changed the outlook for oil and energy markets. The world’s major oil producer, with the lowest cost, was signalling that the kingdom will no longer be supply-driven, focused on […]
Chemicals, the “flea on the tail of the currency/interest rate dog”
Markets are becoming increasingly chaotic, as the world’s major central banks each try to devalue their currencies. They have created a traders’ paradise, with oil on a particularly wild ride. But this has not been based on supply/demand fundamentals. Instead, it has been due to hedge funds jumping back into the commodities market. They don’t […]
Brazil’s PE market shifts from import to export as recession bites
4 years ago, Brazil’s polyethylene market flagged up the first warning signs that its GDP was hitting headwinds, as China’s stimulus programme begin to slow. Today, sadly, the economy is in major recesssion, with the impeachment process against President Rousseff adding further pressure: World Bank data shows GDP fell 3.7% last year: it forecasts “only” […]
Global GDP saw record fall in 2015 – new IMF data
New data from the International Monetary Fund confirms that last year’s collapse in global GDP was even worse than first reported. As the chart shows,the fall when measured in current dollars was a record $4.7tn, versus $3.3tn in 2009. And GDP was down 6% in percentage terms versus 5.3% in 2009: Even more worrying is […]
Oil market rally under threat as Doha meeting fails to agree
Yesterday’s failure of the Doha oil producers meeting will hopefully reintroduce a note of sanity into oil markets. After all, Saudi leaders have made it clear, time and time again, that they were no longer interested in operating a cartel where they take the pain of cutting production, and everyone else gains the benefit of […]
Water wars, food shortages create urgent need for new, demand-led approach
Companies and investors need to refocus on demand as the key driver for future revenue and profit growth. Supply-driven business models are no longer sufficient. ‘How do we do this?” is the critical question, as I discuss in this short video interview with ICIS deputy news editor, Tom Brown: The key is to focus on […]
BRIC auto sales stall as Brazil and Russia recessions worsen
Clouds are gathering over the auto industry, as the impact of the post-2008 stimulus programmes fades into history. It is hard to believe that back in 2013, only 3 years ago, analysts were confidently predicting that Russia would have become the world’s 5th largest market by 2020. And they were similarly forecasting great things for Brazil, which […]
US GDP Q1 forecast at just 0.1%; global chemical output slows
“Confusion now hath made his masterpiece”. This quotation from Shakespeare’s great tragedy, Macbeth, aptly sums up the state of the world economy. Policymakers refuse to accept that the BabyBoomer-led economic SuperCycle is over. And so they continue to believe that adding vast amounts of electronic money to the financial system will return the economy to SuperCycle levels […]
US Federal Reserve aims to devalue the dollar, again
What we “assume” can make an “ass of u and me“, as the proverb says. And that is certainly true of the way central banks have manipulated the major currencies since the financial crisis began in 2008, as the chart shows of the US$’s movements versus the Japanese yen and the euro: It shows the change […]
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