BLOG: Petrochemical buyers, after a very difficult pandemic, can gain from China-driven deflation

Author: John Richardson


SINGAPORE (ICIS)--Click here to see the latest blog post on Asian Chemical Connections by John Richardson.

Petrochemical buyers have had a very difficult pandemic.

Converters and brand owners expected demand to collapse but it did the exact opposite. It boomed.

They face supply shortages because reduced refinery runs have lowered feedstock availability for running petrochemical plants and the US winter storm led to the shutdown of most US capacity.

Shortages of everything from container freight to semiconductors, wooden pallets and metal drums – the result of distortions to demand caused by the pandemic – have added an extra layer of chaos and complexity.

But with the right constantly updated data and analysis, there is a great opportunity for buyers - China’s rising petrochemical self-sufficiency.

The variables are huge, though, as I discuss in today’s post. The post focuses on polypropylene (PP). China could still be importing more than 5m tonnes of PP by 2031. Or it could be exporter by as soon as 2026.

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.