Too Many Are Hoping It Is -
Continued negative fall-out from what is clearly not merely a post-COVID slump in Asia. John Richardson at ICIS had a great post a few months ago, on what makes this industry downturn different.You should follow John Richardson. He’s one of the lead thinkers at ICIS. Here’s his “this time is differently quote” from his post:
I USED TO say to clients, when presenting charts such as the main chart in today’s blog .
“This is very unlikely to happen”.
My message was that project cancellations and strong demand growth would quickly bring markets back into balance._
Now I am not so sure because of the impact on demand of the end of the China property bubble, its ageing population, ageing populations elsewhere, sustainability and the effects of climate change.
Here's the chart in questions. Pretty grim.
Here’s the TLDR (Too Long Didn’t Read)
- ✋🏼 Asian growth has stopped in it’s tracks.
- PLUS 🪫 Capacity overhang out at least a decade.
- PLUS 🔗 industry rationalization mechanisms missing or delayed
- EQUALS
- Sustained blood-bath in polyolefins
A lot of chemicals & materials will be like this because the engine of global growth has been China for decades.
NO LONGER
Until next week,
Kendall -
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