By John Richardson PAUL Satchell, the UK-based chemicals analyst with glob investment bank Cannacord Genuity wrote in his December Volume Proxy* report, which was released earlier this month: “It has long been our opinion that real demand fundamentals in commodity chemicals have been so poor since mid-2010 that inventory cycles have become the prime determinant of […]
Asian Chemical Connections
The US Growth Conundrum
By John Richardson WHERE is the growth in the US economy going to come from to consume the big increase in the country’s ethylene and derivatives production due to take place from 2017 onwards? This is a question that continues to trouble the blog when we study charts such as the one above. It is […]
The WTO “Bali” Deal Versus ASEAN Priorities
By John Richardson WHY sacrifice national or regional growth for the sake of freer global trade? This is a question the blog has been asking itself since the breakthrough last week at the World Trade Organisation (WTO) talks in Bali. This follows our earlier thoughts on how regional trading blocs may become much more significant. […]
The Perils Of An Even Weaker Yen
By John Richardson YOU cannot turn 65-year-olds into 35-year-olds, no matter how much central bank stimulus you throw at the problem. This is why the real, underlying problem with Japan is its demographics which make all the current attempts to stimulate its way to stronger local growth pretty much futile. If there are not enough […]
German Politicians Head In The Wrong Direction
By John Richardson IT took Germany’s politicians five weeks, including a final marathon 17-hour negotiating session, to agree on a “grand coalition”, points out The Economist in this article. The trouble is that, despite this massive expenditure of hot air the deal to form a government, led by Chancellor Angela Merkel (see left), appears likely […]
Iran-West Nuclear Deal Could Boost Naphtha Cracking
By John Richardson THE blog has met many Iranian delegates during its seven years of working for ICIS Training and visited the country a couple of times during the early 2,000s. We love the people and the country, but not some of the politics on both sides. And so it was great news to hear […]
Chemicals Companies Need To Prepare For Deflation in 2014
By John Richardson IF the US Fed’s polices are working why is AP Moller Mearsk – the shipping company which is widely seen as a proxy for global trade – cutting costs and reducing capacity? Probably because as Henny Sender wrote in the Financial Times: “It is clear that the Fed’s quantitative easing is not […]
The US Needs A Plenum
By John Richardson CHINA’S crucial November plenum has now finished and so far there are no details on policy decisions. All we have had is a brief communiqué, which includes key phrases such as “deepening reform” and “crossing the river by feeling the stones”. This latter phrase underlines our argument that reform will be trial […]
Bio-based Local Ethylene Plants A Good Alternative
By John Richardson THE proven approach for success in petrochemicals is, of course, to find cheap feedstocks somewhere and build a world-scale cracker complex. That “somewhere” doesn’t necessarily have to be close to the final customers in emerging markets. For example, the Middle East and more more recently the US can afford to ship large […]
Life After The “Sugar High”: Oil Prices And Petrochemicals
By John Richardson WHY is it that even though demand in the US for petrochemicals is still well below the 2007 peak, as indicated by the latest American Chemistry Council capacity utilisation chart, the November ICIS Petrochemical (IPEX) for the US shows pricing at such elevated levels? (see the charts below). “Never mind,” one might […]
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