By John Richardson EXCESSIVE inventory building down all the major petrochemical value chains is a global rather than just a Chinese problem, according to Paul Satchell – the UK-based chemicals analyst with global investment bank Canaccord Genuity in his latest Volume Proxy research note. “The Volume Proxy continues to decline, with the index now in clear […]
Asian Chemical Connections
US Petchem Feedstock Costs: Not All Gloom for Asia
YESTERDAY we examined some of the factors shaping long-term outlook for polyethylene (PE) exports to China. And, today, as promised, we go into detail on another part of the story: Influences on future feedstock-cost position of US producers. What follows only scratches the surface. There are many more complexities that we shall examine in future […]
China PE Imports: A Long-Term Outlook
By John Richardson THE chart below is worth revisiting, and pondering again, as we attempt to assess the future of polyethylene (PE) exports to China. In the case of the Middle East, as the chart shows, it has been a case of “so far so good” in 2013. Overall PE import volumes from the […]
European Demographics Challenge US Export Assumptions
By John Richardson US feedstock advantages appear to provide an almost overwhelming case for a big wave of cracker and downstream investments, particularly in polyethylene (PE) and polypropylene (PP). In contrast, Europe is struggling with much-higher feedstock costs and low economic growth, resulting in the possibility of many more capacity closures. Only last week, for […]
Australia and The US: History Could Repeat Itself
By John Richardson A PERTH-based businessman who made a very basic piece equipment for the Australian mining industry (details disguised for confidentiality reasons) incurred total production costs of just Aus$6 for each item he produced as a against a sale price of Aus$60 a time. Yes, this is not printing mistake – Aus$60! Quite […]
More People Wanting To Buy Than Sell
By John Richardson SOME people in the petrochemicals industry are showing great confidence in the future. Perhaps it is no coincidence that several of these people are said to be Chinese domestic traders in polyethylene (PE) and mono-ethylene glycol (MEG) who might have long positions to protect. But if PE is in genuinely wonderful shape, […]
Water Shortages to Scupper China CTO Industry
By John Richardson THE debate about how exactly how much coal-to-olefins (CTO) capacity China will add has been largely around the economics of the process versus that of naphtha cracking. In terms of capital costs, building a CTO complex costs 1.5-2 times more than constructing a naphtha cracker, according to our colleagues at CBI […]
Only 4-6 US Cracker Projects Will Happen
By John Richardson ONLY 4-6 of all the above US cracker projects are likely to go ahead as realisation dawns that both demand and feedstock advantage might not be as strong as previously thought, an industry source told the blog. “First of all, companies need to factor into demand and supply forecasts the possibility that […]
Zero And Declining Growth For China Imports
By John Richardson CHIINA’S ethylene equivalent imports will see zero growth over the next 5-7 years and the country’s propylene equivalent import requirement will decline over the same period, says a source with a major oil, gas and petrochemicals producer. This exceptionally bearish forecast is based on lower demand growth as China undergoes major economic […]
Europe’s Rubbish Solution
By John Richardson SHALE gas may never be a significant energy solution for Europe because the political challenges are just too great, as this article in the Financial Times points out.For example, the FT writes that: Fracking is banned in France and the Netherlands. The Dutch government scrapped a parliamentary proposal to allow fracking […]
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