A FALL IN China’s PP imports in April and low operating rates at some China plants suggest 2023 demand growth at minus 1%
Asian Chemical Connections
The old China and HDPE, the new China and the future of demand
In my downside scenario for China’s HDPE demand in 2023-2040 is correct, the country’s total consumption during this period would be 134m tonnes lower than the ICIS Base Case.
Beware of the “head fake” of an improving China and better Q2-Q4 chemicals financial results
YEAR-ON-YEAR chemical company financial results could we improve in Q2-Q4 2023; But this should not be seen as a return to the Old Normal.
China HDPE demand set for 3% decline this year with, perhaps, overstocking supporting the other grades
CHINA’S POLYETHYLENE (PE) market has performed in a very mixed fashion so far in 2023, as the above chart tells us.
The annualised January-March 2023 data suggest a 3% fall in high-density PE (HDPE) full-year demand over 2022, a 3% in increase in low-density PE (LDPE) demand and a 4% increase in linear-low density PE (LLDPE) consumption.
China’s one-off PE demand boom and why consumption could now shrink
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.
Decarbonisation, the timing of the end of this downcycle and building future growth
BECAUSE the old certainties of strong demand growth in China and elsewhere are over, sustainability must be at the core of new petrochemicals growth models.
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.
China PE and PP downcycle a long, long way from being over
The average China PE spread between 1 January and 17 March this year was just $290, the lowest since our assessments began.
Between 2000 and 2021, before last year’s collapse, the annual spread averaged $532/tonne. This means that until spreads increase by 83% from their current levels, there will have been no recovery..
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