Fears are rising about the risks of recession, as I discuss in a new one-page summary of the key issues facing the aromatics industry, ‘What does the future hold for Aromatics?‘. Please click here to download it. These issues will also be key topics at next month’s 17th World Aromatics and Derivatives Conference, jointly organised with ICIS, […]
Chemicals and the Economy
China’s increase in chemicals self-sufficiency will hit US shale gas expansions
Some years ago, when China was well on the way to becoming the world’s largest importer of chemicals, a reporter asked the chairman of Sinochem, China’s largest chemical company if China intended to keep increasing its imports? “Not at all” was Su Shulin’s reply, “This is temporary. It is not our strategy. We will become […]
China becomes net PTA exporter, whilst cotton prices tumble
China used to be the world’s largest importer of PTA (the raw material for polyester). But not any more. Instead it has become a net exporter for the first time in history: □ Its imports ramped up from 400kt in 1995 to 7 million tonnes in 2006, as Western textile manufacturing moved East □ They […]
Global cotton markets wait for outcome of China auctions
China’s long-promised cotton auctions have begun this week. Their outcome will tell us a lot about President Xi Jinping’s ability to force through his New Normal changes in the economy. It will also, of course, have major impact upon the polyester value chain, given the competition between the 2 fibres. As the slide from the […]
China’s cotton auction key pointer for global economy outlook
Cotton markets are poised for another testing month in April. The outcome will also have potentially major implications for the polyester chain – and in turn for commodities markets more generally. The reason is that China has announced that its long-awaited cotton auction will take place in the second half of the month. Cotton stocks […]
China’s PTA market moves to self-sufficiency and exports
Credit conditions are tightening day by day in China. Companies with good payment records over many years are seeing their borrowing limits cut back. 2016 is indeed proving to be the year that President Xi Jinping “takes the pain of restructuring”. At the same time, self-sufficiency has become a key strategy for many industries, in […]
Further chaos ahead for cotton and polyester markets as China aims to release its cotton stocks
Cotton has been on a roller-coaster ride over the past decade – to record high prices and then partial collapse. This was followed by China’s decision to build the world’s largest ever cotton inventory as part of its post-2009 stimulus programme, to protect cotton farmers. This inventory, being off the market, means cotton has been […]
Outlook for the global aromatics industry – insights from senior executives at Amsterdam Conference
Aromatics markets often lead petrochemical markets, and provide good insight into economic trends. This has certainly been true of PTA (terephthalic acid) and benzene over the past year. PTA demand into polyester and PET is dominated by Asia: benzene’s wide variety of uses means it is a good proxy for industrial production in Europe. Recent developments have been […]
Falling cotton/polyester prices create ‘deflation shock’ for consumers
Cotton prices appear to be collapsing again due to the surpluses created by central bank stimulus policies since 2009. As the chart shows, these had initially caused prices to soar to levels not seen since the American Civil War: They reached 230c/lb in March 2011, nearly double the post-1982 peak of 117c/lb in May 1995 (blue […]
China becomes major PVC, PTA exporter for first time in history
Be very careful what you wish for. That is the key message coming out of close analysis of China’s latest trade data. Recent media reports were upbeat at news that China’s exports had increased, as it appeared to suggest Western demand was returning. But it seems nothing could be further from the truth. One major concern is that part […]
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