SINGAPORE (ICIS)--Click here to see the latest blog post on Asian Chemical Connections by John Richardson.
Reinvention in response to rising Chinese self-sufficiency is the way forward for Middle Eastern, Southeast Asian and Northeast Asian ex-China petrochemicals companies.
Today’s post details the extent of the three region’s exposure to China potentially moving to complete self-sufficiency in styrene monomer (SM). An estimated 56% of Saudi Arabia’s SM production in 2020 comprised shipments to China. By as soon as 2026, China may be a styrene exporter rather than an importer.
Similar changes should be expected in polypropylene, paraxylene, ethylene glycols – and possibly even in high-density polyethylene and low-density polyethylene.
Many companies across the regions are well down the reinvention track.
Key areas for focus are:
- Taking advantage of the next wave of growth that will be driven by green technologies. This provides opportunities in higher-value polymers and composite science.
- Generating revenues from global carbon and plastic credits.
- Cautious investments in plastic and chemicals recycling given the economic and logistics challenges.
We are heading into petrochemicals inflation from deflation because of China.
But opportunities for growth are still big for companies with the right focus.
Editor’s note: This blog post is an opinion piece. The views expressed are those of the author, and do not necessarily represent those of ICIS.