THE CHEMICALS industry is the “industry of industries” – upstream of all the manufacturing chains. This is why what is happening in chemicals serves as such an important early indicator. Take a look at the above chart – the latest from the American Chemistry Council. It shows that during September, capacity utilisation in the global […]
Asian Chemical Connections
China and the end-game of the global credit bubble
WHEN stock markets are rising it makes sense to fund your investments through margin debt. Over the last ten years in particular, this approach has produced stellar results because of the abundance of cheap and easy finance. But the above chart is an example of what can happen when lending tightens and demand for margin […]
Middle East, India, SEA petchems winners in new trading blocs
By John Richardson JACK MA, the founder of Alibaba, said of the US/China trade war, “It’s going to last a long time, maybe 20 years. It’s going to be a mess. It’s not a trade war, it’s about competition between two countries.” I believe that the world is set to be split into two trading blocs, […]
US ethylene glycols: The Cost Of Exclusion From China
By John Richardson IF THE US were unable to export ethylene glycols (EG) to China the economic logic of US capacity expansions would face major challenges. Between 2018 and 2025, China will account for no less than 84% of global net imports (imports minus exports) amongst the major importing regions and countries. (For those who […]
PE Margins Fall As Trade War Threatens Two Entirely Separate Trading Blocks
By John Richardson LET’S FIRST of all take a close look at what the above chart is telling us about the damage already done to polyethylene (PE) margins before considering what could happen next. US high-density PE (HDPE) margins are 47% lower in the year-to-date versus to 2017 and low-density (LDPE) margins are 45% lower. […]
Why Trade War Will Continue Throughout 2019 And Impact On Polyethylene
By John Richardson A MISCALCULATION by the White House could be one of several reasons why the US/China trade war continues throughout 2019 – and possibly even beyond that. This is the idea that China is losing the trade war and so will soon be forced to the negotiating table with compromises that meet American […]
Chinese PE Tariffs Come Into Effect: The Impact On The Global Business
By John Richardson CHINA’S 25% import tariffs on all grades of US high-density polyethylene (HDPE) and 93% of the grades of linear-low density (LLDPE), which came into effect yesterday, look set to cause major damage to the global PE business. One of the biggest casualties could be the earnings of US PE producers. We shouldn’t […]
US Import Tariff Decision: Impact On Polyethylene And The Global Economy
By John Richardson THE PROSPECT of a US-China trade war has edged closer as a result of President Trump’s announcement yesterday that the US will impose 25% import tariffs on steel and 10% import tariffs on aluminium. Countries hit hard by the tariffs will include China and Canada. We luckily avoided a trade war in […]
Benefits, Risks Of Petronas/Aramco Deals Serving As Template
By John Richardson THE PETRONAS and Saudi Aramco joint ventures in the RAPID refining-to-petrochemicals project in Malaysia may serve as a template for further “win/win deals”. Whilst these deals will substantially benefit the companies and countries involved, there are broader risks that I’ll discuss at the end of this blog post. Back in February, Aramco […]
Global Polypropylene In 2018-2025: What To Plan For
By John Richardson THIS could be an excellent investment opportunity. Our ICIS Supply and Demand Database base case for Asian and global polypropylene (PP) operating rates sees the steady and steep climb that began in 2014 carrying on until a peak in 2020. In that year, global operating rates will reach 94% and Asian capacity […]
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