By John Richardson THE WORST is over for the margin depletion that’s been experienced by US PE producers in Q4 2018 and likely in Q1 this year as well, I have heard it being argued. There are two problems with this view. Firstly, the worse can only be over if the Chinese economy bounces back. […]
Asian Chemical Connections
The polyethylene world is now even more hooked on China
By John Richardson CHINA’S NET PE imports look likely to have risen by an average of 20% in 2018 over the previous year across the three major grades. Apparent demand (net imports plus local production) looks as if it will be 12% higher. So much for excessive doom and gloom about the Chinese economy then? […]
Oil prices to be buoyed by new shipping fuel rules, despite economic slowdown
Guest blogger today is Ajay Parmar. He is a chemical engineering professional with 5 years of industrial experience in oil refining, primarily in a process engineering capacity. He joined ICIS in 2018 as a Senior Analyst and currently works on developing a price forecasting model for crude oil and refined products. […]
You must not assume a Goldilocks oil price in 2019 – not too hot, not cold
By John Richardson TIME AND again people get oil markets wrong because they entirely focus on the physical supply and demand of the black stuff whilst ignoring the pivotal role that financial speculators play in driving prices higher or lower. Since 2000, futures speculation has greatly increased because of regulatory liberalisation, as I wrote in […]
Asian PE margins to test 2012 lows as consensus catches up with economic realities
By John Richardson IT HAS been evident since as early as February this year that China’s economy is slowing down. But once again, as in 2014, companies and investors have overlooked the key indicator of a slowdown: The sharp decline in credit availability, particularly via China’s shadow banking system. “Not to worry,” I can hear […]
US/China trade war: G20 deal would not solve deep-seated differences
By John Richardson NOBODY should be surprised by warm smiles, firm handshakes and an agreement to freeze the trade war when President Trump and President Xi meet on 30 November. Equally possible is that when the two leaders meet at the G20 Summit in Argentina no deal will be done and the trade war will […]
President Trump’s “very good” call with President Xi: Nothing changes
PRESIDENT TRUMP said yesterday that his discussions with President Xi Jinping were “moving along nicely” following a “very good” telephone call ahead of their critical G20 meeting at the end of November. But on the same day that the US president made his comment, the US Justice Department issued indictments against Chinese and Taiwanese semiconductor companies over […]
US LLDPE exports to Europe to increase by at least 70% in 2019
By John Richardson ON MONDAY I took the percentage shares of total US linear-low density polyethylene (LLDPE) exports in 2017 country by country and on this basis modelled what could happen in 2019. We are next year due to see US PE production jump to 6.5m tonnes from this year’s 5.7m tonnes and 5.1m tonnes […]
US LLDPE needs 68% export growth next year to top five markets…..
…..and that’s assuming there is no trade war with China! By John Richardson THE MORE you dig into the data the more it seems that the US might struggle to find a comfortable home for all of its new polyethylene (PE) production, even without a trade war with China. Using linear low-density PE (LLDPE) as […]
US/China trade war will escalate even if new tariffs are delayed
By John Richardson BY LATER today we may or may not know whether President Trump will proceed with threats to impose a further $200bn worth of tariffs against Chinese imports. This decision is of critical importance to the global chemicals and polymers industries. The go-ahead would mark a major acceleration in the trade war – […]