Where Next For China’s Chemical Industry?

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Where Next For China’s Chemical Industry?

In return for sharing some views on China’s macro trends and direction on government policies, I was able to learn a lot recently about the direction of China’s chemical industry from a group of senior executives from a range of chemical companies.

What did they have to say?

  • Asia will generate 70% of global growth in demand for chemicals between 2012 and 2020]
  • China’s demand for chemicals in 2020 will be about 70% of total Asian demand and 8x the demand from Japan.
  • Key priorities for China – Increase self sufficiency through heavy investment in technologies like coal to olefins – Develop own technology and push it to scale through captive domestic demand (pretty similar to many other industries) – Grow strong domestic champions.
  • China’s imports are mainly very basic petrochemicals to which value is added domestically.
  • Scale of domestic capacity build up in recent years has moved China from net short to net long (e.g., PET, PVC, acrylic acid).
  • Private Chinese companies are reaching global scale (e.g. Wanhua, NHU).
  • The Asian chemical industry has changed from one led by Japanese producers to one with leading players in each major market who are in the global top 20 (see below).

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Image credit: Ricardo Wang / Flickr

By |October 17, 2014|Categories: Gordon's View|0 Comments

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