By John Richardson IT has become the accepted wisdom over the last few years that the coal-to-olefins (CTO) process in China consumes a lot of water. This theory has been expressed in so many conference papers and in research papers that this “truism” is part of just about every discussion on the viability of CTO […]
Asian Chemical Connections
China’s Polyolefins Supply Surge: The Bigger Picture
By John Richardson ON paper, the polyolefins supply surge in China during 2014 is huge as it involves: Some 2.2m tonnes/year of new polyethylene (PE) capacity, according to this ICIS news article. No less than 4.1m tonnes/year of new polypropylene (PP) capacity. To put this into context, China’s total effective capacity was estimated by ICIS […]
Finding A Home For US Polyethylene Expansions
By John Richardson EVEN if you take a benign view of the future of the US economy (which, separately, we think is the wrong view), the planned increases in US polyethylene (PE) capacity still raise this very important question: Where on earth will all of this stuff go? The chart above illustrates our assessment of […]
What A “Low Growth World” Really Looks Like
By John Richardson ONLY six new US crackers would be built over the next five years because of rising construction and labour costs, said Dow Chemical’s CEO, Andrew Liveris, in an earnings conference call last week. This would be out of the 12 crackers that have been announced (see the above table). Demand would therefore […]
European Political Suicide Seems Unlikely
By John Richardson For once, we are not going to talking about demand but will instead focus only on supply. “In all scenarios, the US captures market share away from Europe,” the American Chemistry Council’s (ACC) chief economist, Kevin Swift, said in a presentation last week. As my colleague Nigel Davis, in another of excellent […]
US To Lose Out To China In Energy Race
By John Richardson ARE you either a “tree hugger” or a “climate science denier”? If you fall into one of these two categories, you will be one of the dwindling minority of people who support a multi-faceted approach to US energy policy, according to a US petrochemicals industry source. “The tree huggers are those who […]
China’s Methanol Industry: Through The Looking Glass
By John Richardson AT first glance, some of the facts relating to China’s methanol sector sound like Jabberwocky sounded to Alice when she firs discovered the language of that name in the marvellous Lewis Carroll novel, Alice Through The Looking Glass. Here are some examples of what we are talking about, from our colleagues at […]
China To Keep Polyolefins Imports Out
By John Richardson THERE has been a lot of talk about how fully integrated coal-to-polyolefins plants in China will compete exceptionally well with naphtha crackers on a variable cost basis. OK, in terms of capital costs, the whole coal-to-polyolefins chain is some 2-3 times more expensive than building a naphtha cracker complex. You have to, […]
China Reforms: The Global Implications
By John Richardson IT can feel logical to assume that the fundamentals of the petrochemicals business in Asia haven’t really changed. When you think about it, apart from a brief interruption in the region’s success story during the Asian Financial crisis in 1997-1998, everything has been pretty much plain sailing. And in retrospect, the severity […]
The “Why” Behind Sinopec’s Investment Freeze
By John Richardson SINOPEC has announced that it will halt some of its new petrochemicals investments. This could involve the postponement of up to three cracker projects with a combined ethylene capacity of 2.8m tonnes/year, according to this excellent story from my ICIS colleague, Fanny Zhang. The company confirmed that the 1m tonnes/year Qingdao Petrochemical […]
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