After 5 years of government stimulus, policymakers are having to think about their exit plans. US Federal Reserve chairman Ben Bernanke retires in January, and most of the blog’s clients in the financial community believe that he intends to start the process before he leaves, perhaps as early as next month. This is likely to prove very scary […]
Chemicals and the Economy
India’s auto sales fall for record 6th month
As the above chart shows, India’s auto sales have now fallen for the last 6 months versus the previous year. According to India’s auto association, this has never happened before (sales data was first collected in March 1998). This is another symptom of India’s slowing GDP growth, with the government estimating Q1’s level at just […]
India’s auto sales enter the New Normal
India is the 3rd largest Asian auto market after China and Japan, and a year ago its automobile association was confidently forecasting annual demand growth of 10%-12%. Instead, sales have fallen 7% (India uses an April-March year) – the first time annual sales have fallen for a decade. As Reuters notes: “Carmakers in India, two […]
India’s auto sales drop as onion prices rocket
Unrealistic expectations lead to disappointment. That seems to be the learning from developments in India’s economy in recent years. Its car sales provide a good illustration of the problem, as the above chart shows: • Sales took off in 2010-11, as stimulus measures supported the ‘Incredible India’ media hype • But by 2012 (green line) […]
India’s slowdown boosts motorbike sales
95% of Indian households do not own a car. And as the chart above shows, motor cycles remain the key market for manufacturers. 2011-12 annual figures have now been published, and they show: • 70% of sales were motorbikes (light blue), versus 66% in 2010-11 • Car sales (purple) were steady at 14% • Overall, […]
Indians need basic goods and services, not luxuries
The Indian economy is one of the most misunderstood in the world. It holds great opportunities, because unlike China it still has a relatively young population. But it is also desperately poor. Thus the opportunities are around providing very basic needs, not for western-style goods. The above ‘Business Standard’ chart based on National Sample Survey […]
BASF worries about China, India
BASF opened its first China plant 20 years ago. Its Asian strategy focuses on China, Japan, S Korea and India. Thus yesterday’s comments by vice chairman Martin Brudermüller deserve careful study by any company or investor who is interested in the outlook for the region. The background was an unexpected 5% fall in BASF’s regional […]
Cotton prices slip as India reverses export ban
Cotton prices are falling again, since Monday’s reversal by the Indian government of its proposed ban on cotton exports. India is the world’s 2nd largest cotton exporter, after the USA, with 20% of the market: • On 5 March, its Textiles Ministry banned all exports • Domestic users had applied pressure to divert supplies to […]
Global auto sales growth stalls as BabyBoomers age
Cars are now the largest single market for chemical sales, as housing markets have slowed globally. Each new US car is worth $3297, for example, according to the American Chemistry Council (ACC), making the US market worth $42bn in 2011. 2011 auto sales were ~59m, up 4% from 2010. The West (EU, USA, Japan) still […]
2012 sees rising political risk, and protectionism
The world enjoyed an economic SuperCycle between 1982-2007. Its largest economy, the USA, suffered just 16 months of recession during the whole 25 years. As a result, social and political issues took a back-seat. Politicians instead competed to occupy the middle ground. Former UK premier Margaret Thatcher’s phrase ‘you can’t buck the markets’, became received […]
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