The ICIS Base Case is already very conservative, assuming an annual average China PE demsnd growth of just 2% per year between 2023 and 2025 compared with 11% in 2000-2022. But I see average growth of only 1% or even minus 2% as perfectly possible.
Asian Chemical Connections
China PP demand could grow by 3% in 2023, down from the 2000-2020 average of 10%
THE EARLY DATA suggest that China’s polypropylene (PP) demand could grow by 3% in 2023. This would be in line with the base case forecast I provided in February.
China PE demand growth in 2023 could be only 1% versus forecasts of 5%
Early data suggest China PE demand growth in 2023 will follow the trend since 2021 of much, much lower growth.
US PE exports in 2023 are not inevitably going to increase
A SCENARIO-BASED approach is essential to understand US PE exports in 2023, based on non-plant economic factors
Why China’s HDPE demand could decline in 2023-2040
China’s cumulative HDPE demand under the downside scenario would be 97m tonnes lower than our base case. in the above chart
Global oversupply of petrochemicals to hit 218m tonnes in 2023 – the highest in any other year since 1990
Capacity exceeding demand is forecast to reach 218m tonnes this year from a 1990-2022 annual average of 76m tonnes.
Why China’s 1990-2022 PP consumption could have been 300m tonnes lower without the benefit of “one off” historical trends
IF China had been a typical developing economy, as the above chart illustrates, its cumulative 1990-2022 could have been 300m tonnes smaller. As history moves forward,this suggests that China’s long-term demand growth could turn negative
Collective wishful thinking could be behind the global polyethylene crisis
EVEN IF CHINA’S PE demand grows at 10% in 2023, with very strong growth in other regions, this year’s global capacity would still be 22m tonnes more than demand!
Interest rate “lag effect” and the risks for China’s ethylene glycols market
IT ALL CHAOS AND MUDDLE out there: China’s ethylene glycols demand could either grow by 10% in 2023 or contract by 5%.
A flood of PP no matter how what the 2023-2025 demand growth
EVEN if China’s PP demand growth is 14% this year – double our forecast – and growth in other regions is higher than we expect:
Global capacity in excess of demand would be 18m tonnes in 2023 compared with a 8m tonne/year average in 2000-2022,