Industry News

This section contains information and comments on China´s chemical industry, as posted from January 2024 onwards. Entries are not revised later. For older entries, see separate sections. For daily updates, please join the LinkedIn group "News and Trends in China´s Chemical Industry".---

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Nov 22, 2024: An extensive study analyzes carbon dioxide removal (CDR) policies in the United States and China

Comment MCC: Among other findings, the study reports that while the U.S. has an established tracking and reporting system, China's efforts are in the early stages, primarily focused on pilot projects and regional initiatives.

https://spp.umd.edu/news/collaborating-climate-cdr-policies-and-practice...

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Nov 21, 2024: The state of Mali and Beijing Auxin Chemical Technology Ltd. have signed an agreement to build a plant for the production of explosives for civilian use

Comment MCC: Apparently, this will allow Mali to better control the civilian use of the devices, which are used mainly in the quarries and mines of Africa's third largest gold producer. Beijing Auxin will provide financing and the expertise needed to build the unit.

https://unn.ua/en/news/mali-and-chinese-company-to-build-explosives-plant

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Nov 20, 2024: According to the China Daily, US firms are bullish on China's industrial transformation as it will offer manufacturers in the United States vast opportunities for growth and commercial engagement

Comment MCC: While the article specifically mentions Milliken as expecting "to maintain double-digit growth in China through 2025, driven by the country's rising demand for high-end textile materials and chemicals", overall the source of this information may mean it is not entirely reliable. Almost certainly other US chemical companies are less confident.

https://www.ciie.org/zbh/en/news/exhibition/news/20241115/46909.html

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Nov 19, 2024: A study on China's green development finds that pollutants and the economy are generally decoupled apart from greenhouse gases. However, it also states that the green development efficiency of chemical industrial parks is relatively low, and that study is based on the Shanghai Chemical Park, which is most likely one of the best in that respect.

Comment MCC: On a side note that I may have mentioned before, as a German, I feel vaguely uncomfortable with the title of the journal the paper was published in - "Science of the Total Environment". It uncomfortably evokes scenes of some dictator asking the masses "Do you want the total environment?" ...

https://www.sciencedirect.com/science/article/abs/pii/S004896972407339X

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Nov 18, 2024: Of the total EU exports of chemicals (523 bn Euro in 2023), 7.6% go to China

Comment MCC: I am somewhat surprised how relatively low this number is - China is only the fourth biggest export nation after the US, Switzerland, and the UK

https://ec.europa.eu/eurostat/web/products-eurostat-news/w/ddn-20241106-1

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Nov 17, 2024: China's chemical production expanded by 6.9% yoy in October 2024

Comment MCC: This is higher than the 5.3% increase in overall industrial production. However, these 5.3% mark a decline from the 5.4% in September.

https://tradingeconomics.com/china/industrial-production

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Nov 16, 2024: ClimeCo, a global sustainability company based in Pennsylvania, announced agreements with four Chinese chemical companies at the COP29 gathering that will substantially reduce emissions of nitrous oxide from the companies' chemical plants

Comment MCC: I guess the climate needs some positive news after the Trump reelection - this might be one as nitrous oxide is the third most important driver of climate change after carbon dioxide and methane

https://insideclimatenews.org/news/14112024/china-industrial-nitrous-oxi...

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Nov 15, 2024: In China, hydrogen has become officially classed as an energy resource in a new Energy Law passed on Friday. It had previously been classified as a hazardous chemical

Comment MCC: And of course, it still is a hazardous chemical ... but the new classification gives hydrogen new regulations regarding planning, development, utilization, emergency response, and storage. Presumably, these are more favorable in order to promote the emergence of a hydrogen economy.

https://www.hydrogeninsight.com/policy/major-boost-for-hydrogen-in-china...

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Nov 14, 2024: Accoring to Chemanalyst, chemical businesses in several countries "are optimistic about a surge in exports and investments following the re-election of Donald Trump as the US President. Industry leaders believe that Trump's policies, particularly his stance on China and his pro-business agenda, will offer a significant competitive edge to other countries in the US market. Key sectors such as chemicals, textiles, lithium-based batteries, and pharmaceuticals are expected to benefit from these developments." The article specifically mentions the chairman of Indian conglomerate Aditya Birla expressing confidence in the growth of Indian businesses under Trump's administration.

Comment MCC: This optimism could well prove to be wrong given Trump's protectionist attitude, which may affect imports from all countries, not just China.

https://www.chemanalyst.com/NewsAndDeals/NewsDetails/exclusive-us-china-...

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Nov 13, 2024: A Chinese chemical company, Hubei Aoks Bio-Tech, and some of its senior employees have been indicted on charges of manufacturing and distributing fentanyl precursors

Comment MCC: Apparently, the chemicals were mislabeled and imported as furniture parts and makeup.

https://www.newsnationnow.com/us-news/west/chinese-chemical-company-accu...

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Nov 12, 2024: A paper examines anthropogenic chlorine emission in China

Comment MCC: While HCl emissions were mainly derived from industry (43 %), biomass burning (38 %), and residential (13 %) sectors, HOCl emissions were predominantly from the residential sector, constituting 90 % of the total emissions. The usage of chlorine-containing disinfectants was identified as the most significant source of Cl2 and HOCl emissions in the residential sector.

https://acp.copernicus.org/articles/24/11521/2024/

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Nov 11, 2024: China has a dominant share in many clean energy supply chains, as illustrated in an IEA report - for example, more than 80% in Solar and Batteries, and more than 60% in wind.

Comment MCC: China also dominates many of the materials utilized in these supply chains, including graphite, rare earths, and lithium. See page 139 of the report for details.

https://iea.blob.core.windows.net/assets/c036b390-ba9c-4132-870b-ffb4551...

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Nov 10, 2024: U.S. sunscreen-maker Edgewell Personal Care will try to achieve two- to three-year contracts for Chinese chemicals to help control costs as the company anticipates tariff hikes when President-elect Donald Trump takes office (Reuters)

Comment MCC: As the Reuters article states, "When the U.S. imposes tariffs, U.S. businesses directly pay the taxes to the U.S. government on their purchases from abroad, according to the Tax Foundation. The costs of the levies can be passed onto consumers and contribute to inflation." It also points out that "To offset prior tariffs, Edgewell increased its sunscreen prices for two summer seasons by a percentage in the mid-single digits". It will be interesting to see how Trump voters react once they see that they pay for the tariffs that are likely to be imposed by him. Of course, for a populist like Trump, such details do not matter.

https://www.reuters.com/business/sunscreen-maker-edgewell-looks-lock-chi...

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Nov 09, 2024: Sinopec and 22 other mainland-listed companies will invest a combined 11 billion yuan into stock buy-backs and stake increases after receiving funds through a central bank relending programme aimed at shoring up equities.

Comment MCC: This mixing of economic and political goals may turn out to be detrimental to the overall situation of the companies involved.

https://www.scmp.com/business/china-business/article/3283204/sinopec-lea...

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Nov 08, 2024: According to a report by Axis Capital, India's chemical industry has good growth prospects partly due to the challenges China's industry faces, particularly overcapacity.

Comment MCC: I must admit this rationale is not convincing for me.

https://revealinside.in/indias-chemical-industry-set/

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Nov 07, 2024: 14 people have received criminal sentences and another 34 people have received other punishment in relation to a chemical accident in Panjin on Jan 15, 2023, which led to 13 deaths and 35 injuries.

Comment MCC: The accident was an explosion during maintenance work at an alkylation facility. The company is an independent refinery.

https://english.news.cn/20241028/d9586ab0aaaa44c586b1660dac7b840c/c.html

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Nov 06, 2024: Sinopec's third-quarter ethylene production was 6.4% lower than one year ago, resulting in losses in the chemicals segment of the company.

Comment MCC: One reason is competition from private refiners and chemical companies.

https://www.energyintel.com/00000192-d832-d095-afde-d8f763430000

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Nov 05, 2024: The Association of International Chemical Manufacturers presented its 2024 sustainable development report in Chengdu. The focus is on sustainability, or as China Daily calls it, the circular economy.

Comment MCC: This highlights two trends - the importance of sustainability even for an industry with a less than stellar reputation in this area, and the importance of China for the chemical industry.

https://www.chinadaily.com.cn/a/202411/01/WS67246eb5a310f1265a1cae22.html

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Nov 04, 2024: Chinese scientists have developed a technology for sustainable production of bio-based ethylene glycol with a production capacity of 1,000 tons per year.

Comment MCC: Given that the annual consumption of EG is around 30 million tons and global capacity is about double that amount, this news does not yet indicate that the process is economically feasible or a real alternative to existing production processes.

https://english.cas.cn/newsroom/cas_media/202410/t20241021_692119.shtml

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Nov 03, 2024: A paper examines the impact of a switch to EVs in China and India on emissions.

Comment MCC: Interestingly, compared to a 2030 baseline scenario, national emissions of air pollutants could increase in high EV penetration scenarios due to the emission-intensive battery material production processes. Notably, national sulfur dioxide emissions could increase by 16-20% if all batteries have nickel- and cobalt-based cathodes and are produced domestically.

https://pubs.acs.org/doi/abs/10.1021/acs.est.4c02694#

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Nov 02, 2024: According to an IEA report, China's use of oil as chemical feedstock will take up a larger and larger share of the country's total oil consumption

Comment MCC: In fact, in 2035 it will be larger than Russia's total oil consumption.

https://iea.blob.core.windows.net/assets/c036b390-ba9c-4132-870b-ffb4551...

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Nov 01, 2024: Carbonbrief states that coal-to-chemicals in China will have increased carbon dioxide emissions due to its political support. The industry already uses more than 7% of China's coal consumption and increased by 18% in the first 9 months of 2024.

Comment MCC: As mentioned in my own comments before, Carbonbrief concludes "Coal-to-chemicals is the sector where China's policy priorities of energy security and emission reductions are most directly at odds." And "at odds" here means that emission reduction is regarded as less important.

https://www.carbonbrief.org/analysis-no-growth-for-chinas-emissions-in-q...

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Oct 31, 2024: BASF sales in Greater China fell by 10.5% in the third quarter.

Comment MCC: A surprisingly large drop indicating weakness of the Chinese economy.

https://www.bloomberg.com/news/articles/2024-10-30/basf-earnings-edge-up...

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Oct 30, 2024: The Ministry of Ecology and Environment started a new round of environmental inspections by China's central authorities.

Comment MCC: This round of inspections will focus on four provinces (Jiangsu, Anhui, Sichuan, and Guizhou) and four major SOEs (China National Petroleum Corporation, China Petrochemical Corporation, Sinochem Holdings Corporation Ltd., and China National Chemical Engineering Group Corporation Ltd.).

https://english.www.gov.cn/news/202410/21/content_WS67164e41c6d0868f4e8e...

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Oct 29, 2024: Profits earned by China's chemical firms dropped by 4.0% yoy in the first nine months of 2024

Comment MCC: That is more or less also the decline of the overall industrial sector at 3.5%.

https://tradingeconomics.com/china/corporate-profits

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Oct 28, 2024: According to the New York Times, China tightened its export controls on many rare earths and other minerals required by semiconductor manufacturers.

Comment MCC: In particular, exporters must provide the authorities with detailed, step-by-step tracings of how shipments of rare earth metals are used in Western supply chains.

https://www.nytimes.com/2024/10/26/business/china-critical-minerals-semi...

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Oct 27, 2024: The CEO of Aramco is optimistic on China as his company plans to invest and cooperate more there.

Comment MCC: For example, he stated "China has big ambitions [to grow] in the liquid-to-chemical market. Mainly because of the transition and the need for electric vehicles and solar, they need a lot of carbon fiber. They are building a lot of highly complex integrated refineries, with 60%-70% of liquid-to-chemical conversion facility, which is the highest level of complexity in the world." It seems the main attraction for Aramco is China's focus on chemical uses of oil.

https://www.spglobal.com/commodityinsights/en/market-insights/latest-new...

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Oct 26, 2024: According to a Kazakh newspaper, Chinese companies including chemical ones are expanding their presence in Kazakhstan.

Comment MCC: One example given is a discussed coal chemistry project in Kazakhstan with a minimum investment of 4 billion USD. For this project, the proposed Chinese partner CHN Energy already visited coal deposits in Kazakhstan and collected material for chemical analysis.

https://astanatimes.com/2024/10/chinese-companies-expand-presence-in-kaz...

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Oct 25, 2024: Exports of selected chemicals from China fell substantially year-on-year in August 2024, particularly to India.

Comment MCC: Overall, an echemi article paints a gloomy picture, stating that many chemical companies have very limited orders and had to lay off workers or even temporarily close down. The article also states that many companies resort to price cuts rather than in differentiation and investment in R&D, which most likely will only bring temporary relief.

https://www.echemi.com/cms/2092773.html

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Oct, 24, 2024: Swiss chemicals firm Ems Chemie gave weak demand in China as one of the reasons for weak company sales in the first nine months of 2024.

Comment MCC: According to Reuters, "Ems Chemie generates about half of its sales in the automotive market and is a supplier of the world's largest EV maker, China's BYD. The company makes lightweight polymer car parts, which are especially useful in electric vehicles, which typically weigh more due to heavy batteries." The Ems sales therefore may be a reflection of weakening EV demand.

https://www.reuters.com/markets/commodities/swiss-ems-chemie-9m-sales-do...

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Oct 23, 2024: The petrochemical industry of the Gulf states will be challenged by China striving for self-reliance, according to a recent paper.

Comment MCC: Other challenges include a decline in global demand due to a slowdown in the Chinese market and lower prices for exported products

https://epc.ae/en/details/featured/the-future-of-gulf-china-cooperation-...

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Oct 22, 2024: China's state-owned Sinomine Resource Group partially suspended petalite mining recently at its Bikita lithium project in Zimbabwe

Comment MCC: This is a reaction to current low global lithium prices and the resulting low profitability of petalite-sourced lithium. An S&P report also states that several global lithium miners are halting or scaling down production this year amid pressure caused by a persistent decline in lithium chemicals prices.

https://www.spglobal.com/commodityinsights/en/market-insights/latest-new...

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Oct 21, 2024: A paper analyzes chemical contamination in recycled polyethylene terephthalate (rPET)

Comment MCC: Such an analysis is relevant as contamination impedes the legalization of rPET in food contact applications in China. The analysis identified 1011 compounds, of which a few had relatively high concentrations.

https://www.sciencedirect.com/science/article/abs/pii/S0921344924005408

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Oct 20, 2024: China has successfully reduced its dependence on helium imported from the US

Comment MCC: This is relevant given the importance of helium in medical and hi-tech industries on the one hand and the potential blocking of exports from the US to China on the other.

https://www.scmp.com/news/china/science/article/3282295/china-quietly-ex...

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Oct 19, 2024: According to a senior US official, lithium producers in China are flooding the world market to cause a price drop and prevent foreign mining from pursuing lithium projects.

Comment MCC: Marjorie Taylor Greene added that the Chinese also control the weather and use space lasers to influence the election ...

https://www.voanews.com/a/china-is-oversupplying-lithium-to-eliminate-ri...

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Oct 18, 2024: A Chinese paper covers the Influencing factors and predictions of carbon emissions for the chemical industry in China

Comment MCC: Apparently the per capita industrial output is the main driving factor of carbon emissions while the energy intensity is the main inhibiting factor. The paper predicts that under a strict control scenario, carbon emissions of China's chemical industry may peak around 2031. Sounds optimistic to me given China's focus on coal chemicals ...

https://www.frontiersin.org/journals/energy-research/articles/10.3389/fe...

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Oct 17, 2024: A recent Chinese paper finds that specific PM2.5 chemical constituents and ozone exposure negatively affect pregnancy outcomes in women undergoing assisted reproductive technology treatment in central China.

Comment MCC: Given China's decline in babies, these findings may give the government an additional incentive to manage these pollutants.

https://www.sciencedirect.com/science/article/abs/pii/S143846392400155X

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Oct 16, 2024: China's trade balance in chemicals is positive, with fine and specialty chemicals being the main contributors while for pharmaceuticals and polymers, China is a net importer.

Comment MCC: For details, see a recent VCI paper.

https://www.vci.de/ergaenzende-downloads/kb-china-2024-en.pdf

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Oct 15, 2024: According to Bloomberg/Cipher, the United States could surpass China as the world's leading clean hydrogen producer as early as next year.

Comment MCC: However, the report also warns that China has not yet set a target for hydrogen production in 2030 and thus could expand clean hydrogen production more than expected.

https://www.ciphernews.com/articles/united-states-could-surpass-china-as...

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Oct 14, 2024: Three large Chinese vape companies are researching nicotine-like chemicals they think could serve as a substitute for nicotine in products like vapes

Comment MCC: Frankly, I am not quite sure what the point of this research is given that any nicotine substitutes could easily be more potent, addictive, and dangerous than nicotine itself.

https://www.reuters.com/business/healthcare-pharmaceuticals/top-chinese-...

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Oct 13, 2024: The president of the American Chemical Council states that the U.S. must break its dependence on Chinese chemicals

Comment MCC: This seems partly a scheme to use the threat of China to apply pressure on US policy to reduce regulation on domestic chemical production. Of course, politically it is clever to ask for this given the current China-bashing in the US.

https://www.washingtontimes.com/news/2024/sep/25/us-must-break-its-depen...

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Oct 12, 2024: According to ICIS, Chinese domestic PP capacity was 63% of domestic consumption in 2004, then 89% in 2014, 118% in 2024 and (forecast) 126% in 2025.

Comment MCC: Of course, this puts enormous pressure on Chinese producers to seek export markets, particularly as domestic demand growth slows down.

https://www.icis.com/asian-chemical-connections/2024/10/china-pp-sales-t...

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Oct 11, 2024: BASF started trying to sell its stakes in both of its Xinjiang manufacturing joint ventures to its state-owned partner in late 2023 but recently stated that the sales had not been completed and were "subject to negotiations and required approvals of the relevant authorities."

Comment MCC: The SOEs are presumably in a perfect bargaining position as BASF has no choice after already announcing the JV exits.

https://www.nytimes.com/2024/10/04/business/china-xinjiang.html

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Oct 10, 2024: A Chinese research paper states that for every ton of N fertilizer produced and used in China, 16 t of CO2eq and 0.18 t of NH3 were emitted, compared to 9.7 t of CO2eq and 0.13 t of NH3 in Europe.

Comment MCC: This means emissions could be used substantially just by adopting currently available technologies
https://pubs.acs.org/doi/10.1021/acs.est.4c04041

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Oct 09, 2024: According to Reuters, "China's new stimulus plans make a splash in global markets"

Comment MCC: In particular, Reuters quotes a German equity strategist stating that China's measure to stabilize the real estate segment would have a positive effect on the German chemical sector.

https://www.reuters.com/markets/chinas-new-stimulus-plans-make-splash-gl...

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Oct 08, 2024: Air Liquide will invest close to 60 million euros to take over and operate an Air Separation Unit within the context of a long-term contract with Wanhua

Comment MCC: This is the first contract between Air Liquide and Wanhua - Wanhua previously primarily worked with Linde as a gas supplier.

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Oct 07, 2024: A Chinese news site (in English language) praises Xinjiangs coal industry, which has increased its output: "Xinjiang has taken full advantage of its coal resources to boost the coal industry and the high-quality development of economy. In the first half of 2024, Xinjiang's output of raw coal from enterprises above designated size reached 240 million tons, up 13.4 percent year-on-year"

Comment MCC: How this growth can be aligned with China's stated objectives of reducing carbon dioxide emissions is anyone's guess. And I thought that with a background in chemistry, Xi Jinping would see the contradiction.

https://english.news.cn/20240930/e297cb5fdebe44d0b02bc294aeb6ee2d/c.html

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Oct 06, 2024: According to the National Bureau of Statistics, China's chemical fiber output increased by 13% in the first half of 2024

Comment MCC: In the same period, exports fell by 4% mainly due to a new certification scheme in India.

https://www.texleader.com.cn/en/news-34517.html

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Oct 05, 2024: Kemira has completed a multimillion euro investment to expand the production capacity of alkenyl succinic anhydride sizing agents at its Nanjing site in Jiangsu province in China.

Comment MCC: Apparently, Nanjing is the world's largest alkenyl succinic anhydride production site.

https://www.indianchemicalnews.com/chemical/kemira-expands-alkenyl-succi...

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Oct 04, 2024: Chemdi Group will invest USD 30 million in a 40 kta calcium hypochlorite plant in Egypt.

Comment MCC: Chemdi Group specializes in the production of chlorine-based disinfectants and operates three production bases in Dezhou, Binzhou, and Tai'an, along with three additional bases outside China. Chemdi is the world's largest producer of calcium hypochlorite, exporting to markets in Russia, Eastern Europe, the Middle East, Africa, Southeast Asia, and South America. Interesting to see more and more such Chinese chemical investments in the global South.

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Oct 03, 2024: A recent Bloomberg article on how China got to dominate the solar industry after an early lead of the US is very candid about the failures of the US policy in this area and exposes blaming China's lead on unfair trade practices as a myth.

Comment MCC: In the current atmosphere of China-bashing in the US, this article is surprisingly critical of the US and praises the situation in China. A few quotes to illustrate this:

"China's edge doesn't come from a conspiratorial plot hatched by an authoritarian government. It hasn't been driven by state-owned manufacturers, subsidized loans to factories, tariffs on imported modules or theft of foreign technological expertise. Instead, it's come from private businesses convinced of a bright future, investing aggressively and luring global talent to a booming industry - exactly the entrepreneurial mix that made the US an industrial powerhouse."

"The fall of America as a solar superpower is a tragedy of errors where myopic corporate leadership, timid financing, oligopolistic complacency and policy chaos allowed the US and Europe to neglect their own clean-tech industries. That left a yawning gap that was filled by Chinese start-ups"

The article also provides data showing that China's global market share in solar increased from below 10% in 2008 to more than 90% now.

https://www.bloomberg.com/graphics/2024-opinion-how-US-lost-solar-power-...

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Oct 02, 2024: Shares in Chinese fine chemicals maker Jiangtian Chemical increased by 19% on Sep 30 after it announced that it will acquire the Chinese unit of Japanese chemical producer Sanyo Chemical Industries for USD40.6 million to branch into superabsorbent polymers.

Comment MCC: Sanyo had announced to exit the field after losses in 2023. For Jiangtian, the acquisition is a chance to enter the consumer-grade chemicals market with potentially higher profits - and potentially the capability to improve the cost structure compared to Sanyo. At least the markets seem to believe that this will happen.

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Oct 01, 2024: A blog post foresees substantial growth for China's renewable ammonia market based on China's dual carbon goals.

Comment MCC: The post gives a detailed overview of the current status. For example, it states that new projects are concentrated in regions rich in wind and solar resources, particularly Inner Mongolia and the Northeast regions and that most projects announced thus far have been developed by major state-owned enterprises.

https://www.energypolicy.columbia.edu/why-chinas-renewable-ammonia-marke...

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Sep 30, 2024: A website by a company named vizology asks "Why ChemChina's Business Model is so successful?"

Comment MCC: Apparently, this company offers "AI to boost your business strategy". Unfortunately, the fact that the description of ChemChina includes Syngenta as a competitor rather than a part of the company makes me hesitate to recommend its offerings.

https://vizologi.com/business-strategy-canvas/chemchina-business-model-c...

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Sep 29, 2024: A Chinese study found that VOC levels in industrial zones far exceed those in residential/roadside zones.

Comment MCC: Aromatics are the main contributors, especially in industrial zones - primarily arising from solvent use. If these findings become widely known, resistance against such industrial parks may increase. Side note: As a German, the title of the publishing journal ("Science of The Total Environment") sounds vaguely frightening.

https://www.sciencedirect.com/science/article/abs/pii/S004896972406580X

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Sep 28, 2024: A recent paper describes the results of Chinese actions in reducing PM2.5 pollution. This was done in two phases (2013-2017 and 2018-2020), with improvement in PM2.5 pollution notably slowing down during Phase II.

Comment MCC: Interestingly, the average cost of reducing one unit of PM2.5 concentration in Phase II was twice that of Phase I.

https://www.nature.com/articles/s41561-024-01540-z

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Sep 27, 2024: Chemicals are the third biggest German export product at 8.9% after motor vehicles and parts (17.0%) and machinery (14.2%).

Comment MCC: And China is Germany's main trading partner (Statistisches Bundesamt)

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Sep 26, 2024: A post at resourcewise comments on the phenomenon of negative chemicals prices.

Comment MCC: While the post seems to wonder how this is possible, the explanation is relatively simple for those with knowledge of the chemical industry - the chemical in question is chlorine. Chlorine is a byproduct of the production of caustic soda, so the amount of chlorine produced globally depends not only on the demand for chlorine itself but also on that for caustic soda. In fact, some companies such as Wanhua presumably entered the PVC business primarily to get rid of the chlorine produced by their caustic soda plants. The post also compares Chinese chlorine capacity 46,000 ktpa with that of the US (13,000 ktpa, or 28% of the Chinese capacity), indicating again the massive importance of China for the global chemical industry.

https://www.resourcewise.com/chemicals-blog/free-chemicals-a-bizarre-bus...

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Sep 25, 2024: A Chinese study found a correlation between the utilization of household chemicals and cognitive decline in Chinese older adults.

Comment MCC: The decline in cognitive function is associated with anti-caries agent, air freshener and disinfectant. The more frequent the use of household chemicals, the worse the cognitive function. Presumably, for the same reason (higher frequency of use), women are affected more than men.

https://www.sciencedirect.com/science/article/pii/S2405844024137966

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Sep 24, 2024: The U.S. Drug Enforcement Administration is shutting down two of its 4 offices in China, according to The Associated Press.

Comment MCC: This is a surprising and potentially unwise move in the face US complaints of Chinese inaction in reducing the flow of fentanyl precursors into Mexico and the US.

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Sep 23, 2024: Covestro will start the construction of a new TPU APAC application development Center in Guangzhou in South China.

Comment MCC: The rationale contains the usual statements about getting closer to customers and integrating "technical acumen with innovative solutions and tailored services in key applications".

https://www.chemengonline.com/covestro-to-construct-new-tpu-application-...

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Sep 22, 2024: A Chinese court ruled that two refineries (Shandong Huaxing Petrochemical Group and Zhenghe Group Co Ltd) owned by state oil and chemical group Sinochem were bankrupt after creditors failed to agree on restructuring plans (Reuters). A third refinery was declared bankrupt a few days later.

Comment MCC: While these refineries were small with a combined processing capacity of 220,000 barrels per day, it still surprises me that Sinochem allowed them to go bankrupt as this could damage the reputation of the mother company.

https://www.reuters.com/world/china/chinese-court-rules-two-sinochem-ref...

https://www.reuters.com/markets/commodities/chinese-court-declares-anoth...

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Sep 21, 2024: In 1992, China, with a 22% share of the global population accounted for 3% of global polycarbonate demand but by the end of 2024, China is expected to be responsible for 47% of global demand from an 18% share of the global population (ICIS)

Comment MCC: However, ICIS forecasts that China PC demand growth will drop from an annual 17% (1992-2021) to 3% (2022-2030).

https://www.icis.com/asian-chemical-connections/2024/09/the-china-story-...

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Sep 20, 2024: Markus Kamieth, CEO of BASF, in an earnings call remarked on the weak state of China's economy and its impact on global chemical prices: "The situation in China certainly has an impact on the overall pricing situation in the world. There's no question about that because China is by far the largest chemical market in most of the chemical categories that we are looking at here ...That meant that overcapacities have built up, also in the chemical markets. These products are looking for a home. Of course, that sets price pressure."

Comment MCC: Other chemical CEOs have also recently mentioned the same issue of low China demand and its impact on chemical prices.

https://www.3eco.com/article/deep-dive-chinas-overcapacity-issues-affect...

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Sep 19, 2024: China's industrial production rose by 4.5% yoy in August 2024, the fourth straight month of a slowdown, due to the disruption caused by extreme weather this summer.

Comment MCC: Chemicals growth was above the industrial average at 5.9%

https://tradingeconomics.com/china/industrial-production

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Sep 18, 2024: China is the third-largest importer of chemicals into the EU with 13% (USA 24%, Switzerland 20%, UK 9%) and the fourth-largest export destination with 8% (USA 26%, Switzerland 11%, UK 9%).

Comment MCC: I am actually a bit surprised about the relatively low importance of China for the EU chemicals trade.

https://ec.europa.eu/eurostat/statistics-explained/index.php?title=Produ...

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Sep 17, 2024: Sinopec won the Best Environmental Protection Case award at the First Sino-European Corporate ESG Best Practice Conference in Frankfurt, Germany.

Comment MCC: Call me cynical, but reading the press release on this, it sounds more like a pure PR activity than an award obtained for anything real, given the sponsorship and the organizers: "Themed Together for the Future, the conference showcased top cases in ten categories, including environmental protection, social responsibility, corporate governance, and technological innovation. It aimed to foster dialogue and cooperation on sustainable development between Chinese and European businesses and deepen understanding of China's advancements among German and European industrial communities. KPMG served as the knowledge partner, providing professional services throughout the selection process. The event was co-organized by several prominent institutions, including the China Chamber of Commerce for Import and Export of Machinery and Electronic Products, China International Publishing Group, Frankfurt Chamber of Commerce, Frankfurt International Auto Parts Exhibition, and the German-Chinese Economic Association."

https://www.prnewswire.com/in/news-releases/sinopec-wins-best-environmen...

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Sep 16, 2024: Tianqi Lithium had its first half-year loss since 2020, hit by the battery material's massive price slump, according to Caixin.

Comment MCC: Reasons cited include a supply glut and slower growth of EV demand, driving down prices.

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Sep 15, 2024: During the three-day Forum on China-Africa Cooperation in Beijing, Egypt and China signed agreements with Chinese companies totaling over $1.1 billion.

Comment MCC: Some details - Chemicals manufacturer Befar Group will establish a $500 million chlor-alkali plant, Shandong Tianyi Chemical will invest $110 million in a bromine extraction complex that will extract bromine using seawater desalination byproducts, Dahui Glucose and Tiba Starch will invest $7.5 million in a modified starch production facility.

https://www.egypttoday.com/Article/3/134612/Six-Chinese-companies-sign-M...

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Sep 14, 2024: In 1992-2023, China accounted for 76% of global net imports of PC among the regions and countries that imported more than they exported (ICIS)

Comment MCC: Some countries are extremely dependent on exports to China - for example, Taiwan exports 83% of its production to China, Thailand 41%, South Korea 34% and Japan 26%. As ICIS points out, as China's domestic production increases and demand growth slows, it is unlikely that these countries can still export the same amount of PC to China in the future.

https://www.icis.com/asian-chemical-connections/2024/09/the-china-story-...
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Sep 13, 2024: The European Chamber of Commerce in China has released its annual position paper, including one section on the petrochemical and chemical industry

Comment MCC: Key concerns of the industry seem to be in the area of legislation & regulation. Some of the statements seem virtually meaningless though - how could anyone object to a statement such as "Optimise the Legislative Framework for the Regulation of Chemicals to Ensure a Sustainable, Market-orientated and Internationalised Business Environment"?

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Sep 12, 2024: A Chinese paper finds that regional emission trading schemes in China reduce carbon dioxide emissions by about 6% in the affected cities.

Comment MCC: Interestingly, they also increase emissions in neighboring regions not affected by the schemes by about 2% - a phenomenon described as carbon leakage.

https://pubs.acs.org/doi/10.1021/acs.est.4c04738

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Sep 11, 2024: According to the CEO of Syensqo (ex-Solvay), China is expected to produce half of the world's chemicals in the future. It already contributes about 15% of its global growth in 2024. The CEO believes that Syensqo still has space to grow three-fold in China.

Comment MCC: The 50% figure has also been cited by BASF. Sidenote: How wise it is to choose a company name that nobody knows how to pronounce?

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Sep 10, 2024: An Indian industry expert, Ajay Joshi, predicts that there will be more and more anti-dumping duties on Chinese chemicals imported to India to protect the local players.

Comment MCC: Joshi also points out that these anti-dumping duties will only help the Indian players in the domestic Indian market, not in export markets.

https://economictimes.indiatimes.com/markets/expert-view/more-anti-dumpi...

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Sep 09, 2024: A recent scientific paper analyses the effect of different climate and air quality policies in China on in situ ozone production in Beijing

Comment MCC: An interesting aspect is the predicted rise of biogenic VOC emissions as urban temperatures rise and Beijing gets greener. This rise will also lead to increased ozone concentrations derived from these biogenic emissions.

https://acp.copernicus.org/articles/24/9031/2024/

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Sep 08, 2024: From January to July 2024, China's production of technical chemical pesticide reached 2.213 million tons, a year-on-year increase of 30.6%.

Comment MCC: Given the government objective not to increase pesticide use in China, this most likely means strong export growth.

https://news.agropages.com/News/NewsDetail---51316.htm

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Sep 07, 2024: China Daily has a report titled "Guizhou chemical project advances green goals"

Comment MCC: This is about a phosphate and coal chemical integration project in Guizhou province, the largest industrial project in the province's history with a total investment of approximately 73 billion yuan. It will consume about 13.21 million metric tons of coal per year. How a project with such a coal consumption can advance green goals is a mystery to me.

https://global.chinadaily.com.cn/a/202409/04/WS66dc310a3108f29c1fca0c2.html

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Sep 06, 2024: A recent Chinese paper describes development opportunities for China's heavy (the term used in the paper) chemical industry arising from the BRI

Comment MCC: The authors conclude that based on an analysis of market, cost, governance, and industry chain support, Southeast Asia and West and Central Asia are suitable investment destinations for China's heavy chemical industry. Investment in these countries may help them guard against the risk of trade frictions.

https://link.springer.com/chapter/10.1007/978-981-97-4468-8_10

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Sep 05, 2024: Russia's Industry and Trade Ministry and China's MIIT signed an MOU on cooperation in the chemical industry as part of the meeting between the prime ministers of both countries.

Comment MCC: Not surprising given the proclaimed limitless friendship between the two countries, but perhaps a bit worrying for Western chemical MNCs active in China - assuming such a cooperation is in any way meaningful

https://interfax.com/newsroom/top-stories/105293/

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Sep 04, 2024: In the list of biggest global chemical companies by sale in 2023 as issued by Chemical Week, 3 of the 6 biggest chemical companies are from mainland China, and one more is from Taiwan.

Comment MCC: So, finally the almost 50% share of China in the global chemical market is also reflected in the list of biggest players.

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Sep 03, 2024: An article on the website of Huawei describes how "Large models empower the chemical industry with a new development paradigm"

Comment MCC: The objectives of the Chinese researchers for such a model include reducing the need for upscaling efforts, shortening the R&D period, reducing R&D investment, optimizing industrial processes, and supporting decision-making and planning. Worthy objectives, of course - though anyone using the term "new development paradigm" should be viewed with a healthy dose of distrust, I think.

https://www.huawei.com/en/media-center/transform/15-5/02-large-models-em...

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Sep 02, 2024: The Global Times, a Chinese tabloid, has a gushing article on Jilin Chemical Fiber Group Jilin Chemical Fiber Group has evolved into a global leader in carbon fiber production and is now China's largest producer in this field.

Comment MCC: There is some interesting information in the article, though, indicating the typical impact of Chinese companies on prices: "Local production of carbon fiber precursors has driven down international prices by 40 percent".

https://www.globaltimes.cn/page/202408/1318558.shtml

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Sep 01, 2024: An article on the presence of Arkema in China states that the company derives 13% of its sales from China.

Comment MCC: Compared to Western peers, this is a relatively high number, meaning that China is the second-largest national market of the company. However, compared to China's share of the global chemical market - substantially above 40% - it is still a low figure.

https://english.shanghai.gov.cn/en-Latest-WhatsNew/20240821/cdee3a3411db...

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Aug 31, 2024: Wanhua launched its 48 kta citral production plant in Yantai, China. It is reported to be the world's largest single-unit citral production plant.

Comment MCC: This is an important step for Chinese chemical companies moving into difficult-to-produce fine chemicals. In the long run, it may threaten the position of Western chemical companies that still have the lead in many high-end, smaller-volume chemicals. Reportedly, it took Wanhua 14 years from the start of research on citral to starting up the plant - a time horizon not typical for Chinese players.

https://www.chemanager-online.com/en/news/wanhua-launches-citral-plant-c...

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Aug 30, 2024: Global Times, a nationalistic Chinese tabloid, published an article titled "China's state security authorities expose espionage cases involving postal deliveries". In it, an example from the chemical world is described as follows: "A foreign organization, under the guise of a scientific project, mailed a certain chemical powder to a research institution in China. Unsure of the powder's composition and intended use, the staff member of the Chinese research institution promptly contacted national security agencies. Upon investigation, it was found that this type of powder could be used as a catalyst in various harmful chemical experiments. Had it been successfully infiltrated, it would pose significant risks to the key research projects undertaken by the institution"

Comment MCC: A rather bizarre example that does not sound particularly realistic to me. Unlike USB sticks (as used by the US to sabotage Iran's nuclear program), chemists rarely use random catalysts received by mail in their experiments - at least I have never done so.

https://www.globaltimes.cn/page/202408/1318344.shtml

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Aug 29, 2024: Neo Performance Materials is selling nearly all its Chinese rare earth separation business to Shenghe Resources, a rare earth processor in China, for $30 million (C&EN).

Comment MCC: Given the small size of the business and the strategy shift of the Canadian company, this divestment seems to be more about adapting the product focus of the company than about reducing its presence in China.

https://cen.acs.org/materials/Neo-sell-Chinese-rare-earth/102/i26

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Aug 28, 2024: China Daily reports on a study finding perchlorate in food and water in the US. About 67 percent of the samples had measurable levels of perchlorate, and the top three product categories with the highest levels of perchlorate were baby/kid food, fruits and vegetables, and fast food.

Comment MCC: There is no strong reason for China Daily not to report on such a study. However, there are even fewer good reasons not to report on other studies related to perchlorate occurrence in Chinese honey, in Chinese drinking water, and bottled water - particularly as one study found a negative relationship between perchlorate concentration in drinking water and the weight and height of Chinese children.

https://www.chinadaily.com.cn/a/202408/16/WS66be62d9a3104e74fddba335.html

https://www.sciencedirect.com/science/article/abs/pii/S0304389423025104

https://www.sciencedirect.com/science/article/pii/S0160412021006206

https://www.frontiersin.org/journals/public-health/articles/10.3389/fpub...

https://www.researchgate.net/publication/41454057_Perchlorate_in_Tap_Wat...

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Aug 27, 2024: The stock of Shenyang Chemical, a major chlor-alkali company, fell by 14% in three days after China's Securities Regulatory Commission launched an investigation into suspected violations of information disclosure.

Comment MCC: This could be touchy as the company is controlled by the SASAC. In addition, the company has a history of issues - it already had to delay the disclosure of its 2023 annual report.

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Aug 26, 2024: China's production of chemical products increased by 8.6% year-on-year in July 2024, according to the National Bureau of Statistics of China

Comment MCC: A surprisingly high figure compared to the industry average of 5.1%.

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Aug 25, 2024: According to Nikkei Asia, Chinese new-auto sales shrank by 5.2% on the year in July, and for domestic sales, the decline was even steeper at 10.1%.

Comment MCC: Even the growth of EVs - which have a greater input share from the broader chemical industry - only grew by 2.6%, though plug-in hybrids grew by 80.7%.

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Aug 24, 2024: According to SMM, the operating rate for the production of LiPF6 in China was approximately 47.1%

Comment MCC: While the projected operating rate is forecast to reach around 55.8%, this still means there are massive overcapacities.

https://news.metal.com/newscontent/102900256/smm-data-operating-rate-of-...

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Aug 23, 2024: The Alliance for Chemical Distribution, an industry association representing more than 400 US chemical distributors, claims that mainland Chinese citric acid is imported via third countries to bypass high anti-dumping rates, and wants the government to take action due to the "significant risk to the safety and security of the United States' public health and economic resiliency".

Comment MCC: Hyperbole apart (cheap citric acid as a risk to the safety and security of the US??), the organization probably has a point, stating that the third countries involved (Mexico, India) do not have sufficient production capacity for citric acid to produce the amounts exported from there to the USA. Instead, it is reasonably claimed that Chinese citric acid is only repackaged, relabeled or dehydrated in these countries

https://research.hktdc.com/en/article/MTc3ODMzMTM4NQ

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Aug 22, 2024: Five people were killed in an explosion at a workshop of Ningxia Shunbangda New Materials located at the Ningdong Energy Chemical Industry Base in Ningxia. The company produces initiators for the polymerization of PVC.

Comment MCC: The company is controlled by Jiangsu-based Changzhou Fuding Technology Co., Ltd. It may be an example of a company moving part or all of its production from Jiangsu - where chemical production gets more restricted - to the laxer regulation of Ningxia. That in turn has the potential to increase the number of accidents.

https://english.news.cn/20240820/0be8c98d6c1c4c7dac572dd54d7d1efa/c.html

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Aug 21, 2024: A Chinese scientific paper in the Journal of Energy Chemistry reviews ways of converting cellulose to chemicals including hydrogen, acetic acid, and transportation fuels using photocatalysts and solar energy as power source.

Comment MCC: A potentially promising way toward chemicals with a low carbon print, though at this point, the technology is far away from being used commercially.

https://www.sciencedirect.com/science/article/abs/pii/S2095495624001797

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Aug 20, 2024: According to SMM, in July 2024, China's ternary cathode materials production was up 19% MoM and 3% YoY

Comment MCC: A surprisingly low growth rate given that this is supposedly a rapidly growing market benefiting from the energy transition.

https://news.metal.com/newscontent/102899545/smm-analysis-on-china-july-...

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Aug 19, 2024: A recent report on the Chinese fine chemicals industry lists several issues of the segment including low R&D spending, weak technical equipment, inadequacy of supply of high-end products, safety and environmental pressure, and insufficient upstream and downstream collaboration. It further states that "the Chinese fine chemical products are mostly low-end products, being primarily raw materials and general-purpose products. In contrast, the supply of high-end products, such as high-end scientific research-oriented reagents, high-performance catalysts, special surfactants, and high-performance resin, is insufficient."

Comment MCC: As a consequence, 9 national ministries have issued the "Implementation Plan for Innovative Development of Fine Chemical Industry (2024-2027)" to guide the development of the industry.

https://news.agropages.com/News/NewsDetail---51094.htm

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Aug 18, 2024: According to Guo Jiawan, chairman of Guangxi Guolong, in China, the application of recycled plastics in the packaging market is mainly driven by the demand from international brands.

Comment MCC: Different from Western countries, growth opportunities for recycled materials in China come more from government regulation than from companies aiming to demonstrate their environmental credentials.

https://www.argusmedia.com/en/news-and-insights/market-opinion-and-analy...

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Aug 17, 2024: According to the New York Times, a majority of undergraduates in China major in math, science, engineering or agriculture while only a fifth of American undergraduates are in the roughly equivalent categories

Comment MCC: This is one of the reasons for China leading in some new technologies. According to the Australian Strategic Policy Institute, 66% of widely cited technical papers on battery technology come from China, compared with 12% from the United States.

https://www.nytimes.com/2024/08/09/business/china-ev-battery-tech.html

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Aug 16, 2024: A Chinese paper describes the electrochemical catalyzed reduction of carbon dioxide to methanol

Comment MCC: This is a potentially promising reaction as it provides a way to eliminate carbon dioxide while at the same time producing a widely used raw material.

https://pubmed.ncbi.nlm.nih.gov/39114914/

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Aug 15, 2024: According to Bloomberg, Saudi Aramco aims to invest in more chemical plants in China this year and next

Comment MCC: The rationale is that Aramco sees demand for goods such as plastics outlasting the growth in consumption for gasoline, and thus focuses on turning oil into chemicals. The aim is to eventually turn about 4 million barrels a day of crude into chemicals, from about 2 million currently.

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Aug 14, 2024: Chinese scientists found water on the moon in the form of a lunar mineral with the rough formula of formula (NH4)MgCl3·6H2O), which is made up of roughly 41% water.

Comment MCC: This could be a resource for lunar habitation.

https://edition.cnn.com/2024/08/05/science/china-moon-samples-water-intl...

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Aug 13, 2024: Fitch Ratings downgraded the rating of Wanhua to 'BBB' from 'BBB+'.

Comment MCC: The rationale is Wanhua's investment in new projects and the resulting capex plans in a situation when chemical demand is relatively weak.

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Aug 12, 2024: A paper describes the creation of a 10-m scale chemical industrial parks map along the Yangtze River in 2021 based on machine learning

Comment MCC: The authors claim that "this research will provide a scientific basis for the fine governance of chemical industries in the region."

https://www.nature.com/articles/s41597-024-03674-6

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Aug 11, 2024: Hundreds of people in Europe have been affected by sofa dermatitis, a skin allergy that occurs in people who have bought leather furniture containing dimethyl fumarate, an anti-molding agent.

Comment MCC: Apparently, leather furniture exported from China is shipped with sachets of DMF, which may evaporate and seep into the leather. On the other hand, as my leather jackets stored in a wardrobe during the Shanghainese summer demonstrate, some kind of anti-molding protection seems necessary.

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Aug 10, 2024: According to a recent paper, long-term exposure to PM2.5 chemical components increases the risk of diabetes mellitus in older Chinese adults

Comment MCC: A potential additional incentive to reduce these components. Particularly affected are individuals living in rural areas, poor people, and women. So my advice is to be rich, live in a city and be male.

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4877794

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Aug 09, 2024: China will impose controls on the production of chemicals used to manufacture fentanyl.

Comment MCC: This is a sign of increased cooperation between the US and China in this matter, as the US has asked for such restrictions for a long time already.

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Aug 08, 2024: According to Atradius Collections, after a 10.6% increase in 2023, China´s chemical production growth is expected to reach 4.7% in 2024 and 3.1% in 2025.

Comment MCC: The source further comments that Chinese chemical production remains competitively priced, supporting exports, but that oversupply and subsequent low margins are an issue for Chinese chemical producers.

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Aug 07, 2024: A recent paper examines contaminants of emerging concern in surface and wastewater from the Yangtze River chemical contiguous zone. It classifies nineteen such contaminants as presenting a high or medium risk to aquatic organisms.

Comment MCC: Caffeine, trenbolone, and norethindrone posed a threat to the most vulnerable aquatic species

https://www.sciencedirect.com/science/article/abs/pii/S0048969724053014

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Aug 06, 2024: According to the NDRC, China will be testing decarbonization technologies at coal-fired power plants, including cofiring with ammonia and biomass, and carbon capture and storage, to reduce their carbon intensity.

Comment MCC: The goal is to cut carbon intensities of coal plants by around 20% by 2025 and 50% by 2027 from the average industry levels in 2023. This will require around 200 million mt green ammonia/year if the country mandates a 10% replacement of coal for all existing coal power plants, according to Commodity Insights.

https://www.spglobal.com/commodityinsights/en/market-insights/latest-new...

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Aug 05, 2024: The Energy and Chemical Industry Chain Carbon Footprint Alliance established by eight companies including China National Petroleum Corp, China National Offshore Oil Corp and China Petroleum and Chemical Corp will establish an initial carbon footprint management system and carbon footprint accounting standards by 2027 to support the industry in reducing carbon emissions.

Comment MCC: Presumably the idea is to control the process from the side of the industry players rather than have it dictated by the government - though given that these companies are SOEs, the difference may not be that big.

https://www.chinadaily.com.cn/a/202407/24/WS66a0eb7ba31095c51c50fbd9.html

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Aug 04, 2024: Chinese brands reached a share of 11% of the European electric-car market in June 2024.

Comment MCC: The big jump from May (+72%) is mainly an effect of the import duties imposed on EVs imported from China and registered after July 4.

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Aug 03, 2024: Solvay will supply rare earth metals for permanent magnets used in EVs and wind turbines from a refurbished plant in France, with the aim of meeting 30% of Europe's needs for permanent magnets by 2030.

Comment MCC: The company states that this is to help the continent reduce reliance on China. It may be an argument to justify higher prices than for Chinese imports as well.

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Aug 02, 2024: In an interview, the BASF China president stated "We are investing in China to expand local manufacturing capabilities and strengthen local R&D capabilities"

Comment MCC: Currently, BASF manufactures about 80% of its products sold in China locally, so there is still room for more localization.

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Aug 01, 2024:Two people died in an explosion at a chemical plant of Hunan Xiangshuo Chemical in Hengyang, Hunan.

Comment MCC: This seems to be a company with the English name Solarchem (www.solarchem.cn), a producer of triazole. The production process may involve azides, which can explode.

https://www.chinadaily.com.cn/a/202407/30/WS66a8d9e9a3104e74fddb7a19.html

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Jul 31, 2024: Several Chinese ministries released a plan to phase out outdated chemical equipment.

Comment MCC: According to HKTDC, three categories of chemical plant storage tanks will be phased out, namely those deemed outdated according to the safety risk assessment guide, existing pressurized liquefied hydrocarbon storage tanks, and storage tanks for constant pressure combustion and highly toxic liquids with a capacity of over 3,000 cubic meters.

https://research.hktdc.com/en/article/MTc0NDQ2MzUxNQ

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Jul 30, 2024: Clariant and Wanhua are seeking to deepen their cooperation in areas such as digitalization and catalyst performance improvement.

Comment MCC: Maybe I have been a consultant for too long already, but I am rather bored by statements such as "We are committed to support with our innovative and sustainable solutions, our world-class operation facilities, as well as our digitalized customer service to grow with Wanhua in this dynamic market."

https://www.clariant.com/en/Corporate/News/2024/07/Clariant-expands-coll...

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Jul 29, 2024: The European Union implemented provisional anti-dumping duties on China's titanium dioxide imports

Comment MCC: A Statista dataset gives China a 36% share of global titanium dioxide production in 2021, far ahead of the biggest European producers Norway (5%) and Ukraine (4%) - the "other" section (8%) may also include some smaller European producers. Given this dominance, it is hardly surprising that China can produce titanium dioxide at lower costs and subsequently sell it at lower prices without this necessarily indicating unfair trade practices.

https://www.statista.com/statistics/480822/titanium-dioxide-global-produ...

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Jul 28, 2024: Borouge, Borealis, ADNOC, and Wanhua will conduct a feasibility study for a 1.6 million-ton/yr specialty polyolefin complex in Fuzhou.

Comment MCC: An interesting though somewhat messy-looking cooperation involving Western, Saudi Arabian, and Chinese parties - though of course, Borealis and ADNOC are already closely linked.

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Jul 27, 2024: An interesting paper describes the impact the Shanghai lockdown in April and May 2022 had on ozone levels. These increased despite the substantial reduction in VOC and NOx levels during this period.

Comment MCC: While the overall explanation for this rise is complex, the main cause for the somewhat unexpected increase in ozone levels is the increasing ratio between VOCs and NOx. The authors thus conclude that "in terms of ozone control strategies, it is necessary to strengthen the regulation and control of VOCs."

https://acp.copernicus.org/articles/24/8383/2024/acp-24-8383-2024.pdf

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Jul 26, 2024: A Chinese vehicle manufacturer has released the first domestic corporate standard in tanker truck equipment for edible oil transportation. This is a consequence of a Beijing News report on mixed transportation of food and chemical liquids in the same vehicle without cleaning in between.

Comment MCC: Such a standard does not solve the problem at all, which is that operators do not follow existing Chinese Food Safety Laws but are ignored by operators due to cost aspects.

https://www.globaltimes.cn/page/202407/1316473.shtml

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Jul 25, 2024: The US Department Of Justice announced the indictment of a Chinese national for his involvement in selling fentanyl raw materials imported from China to Mexican fentanyl manufacturers. The DEA stated "To end the deadliest drug threat the United States has ever faced, the Drug Enforcement Administration (DEA) starts where the harm begins - with the Chinese chemical companies and the individuals that are selling chemicals to those who make and sell the fentanyl that is killing Americans."

Comment MCC: While this is presumably technically correct, it is also strangely focused on the Chinese nationality of the person involved, thus fitting in with the general theme of China-bashing. The "killing of Americans" cited here requires the involvement of both Mexican fentanyl producers and US American drug dealers, not just that of a Chinese importer of raw materials. This aspect seems to be strangely neglected by the DEA.

https://www.justice.gov/opa/pr/chinese-national-indicted-importation-eno...

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Jul 24, 2024: Quaker Houghton broke ground on a new plant for industrial process fluids in Zhangjiagang, China.

Comment MCC: Another example of ongoing localization. Yes, that is kind of boring.

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Jul 23, 2024: Jiangsu Eastern Shenghong entered the C&EN list of biggest global chemical companies in 2023, leading the magazine to remark "Recent years have seen large, integrated petrochemical makers in China appear seemingly out of nowhere on C&EN's ranking among more familiar names."

Comment MCC: Indeed, after a 79% increase in revenues in 2023, the producer of ethylene, p-xylene, and polyester now is higher on the list than companies such as Covestro, Lotte, Bayer, or DuPont.

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Jul 22, 2024: The C&EN list of global top chemical companies has 5 mainland Chinese chemical companies in the top 20 for 2023, one more than in 2022.

Comment MCC: In addition, all Chinese entries in the top 20 maintained or improved their ranking, some quite substantially (e.g., PetroChina moved from 8 to 5), indicating the still-growing importance of China's chemical industry

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Jul 21, 2024: The MIIT issued an implementation plan for the development of China's fine chemical industry during the 2024-2027 period. The plan proposes cultivating more than 500 "little giant" enterprises.

Comment MCC: Focus areas are high-end, innovative and green fine chemicals. 

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Jul 20, 2024: According to ICIS, disruptions to Red Sea cargo shipping due to the Houthi attacks affect the European chemical industry as it forces ships to take the longer route around the Cape of Good Hope.

Comment MCC: Of course, this reduces overall shipping capacity and increases the amount of chemicals in transit.

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Jul 19, 2024: Jinko Solar and TCL Zhonghuan, two Chinese producers of solar energy equipment, will from JVs with Saudi Arabia's public investment fund and set up local production in Saudia Arabia.

Comment MCC: The production will at least be partly for export, thus potentially circumventing barriers on exports from China to the West.

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Jul 18, 2024: Elementis has expanded its Non-Ionic Synthetic Associative Thickeners production in China.

Comment MCC: Another example of ongoing localization.

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Jul 17, 2024: According to a forecast by the CPCIF, China's capacity will be above or substantially above for several basic polymers and chemicals by the end of 2025. These include PP, PE, PVC, PET, EVA, methanol, and glycol.

Comment MCC: This will lead to increased pressure to export these materials, which in turn will not be appreciated by chemical companies in the target countries.

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Jul 16, 2024: Chinese producers have more than doubled global PDH capacity between 2019 and 2024, according to the IEA.

Comment MCC: However, this has led to overcapacity and low operating rates. While they used to run at 80-85%, rates decreased to below 70% and even sometimes closer to 50%, according to ICS. And there are still more PDH plants coming onstream.

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Jul 15, 2024: Indian government agencies seized a Chinese shipment of internationally banned chemicals including Ortho-Chloro Benzylidene Malononitrile (CS), a chemical used as a tear gas and riot control agent, which was apparently intended for Pakistan

Comment MCC: The Indian concern arises from the potential use of the chemical for chemical warfare - and of course from the fact that neither Pakistan nor China are India's friends.

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Jul 14, 2024: According to Statista, Chinese pesticide production reached the lowest level in 2020 but increased again afterward.

Comment MCC: This is somewhat surprising as the stated government goal is not to increase pesticide usage in China - but exports may account for the increase after 2020.

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Jul 13, 2024: According to a recent paper, the productivity of ethnically Chinese scientists in the US decreased by 2-6% after 2016, when compared with non-ethnically Chinese researchers.

Comment MCC: As this is publicly available research benefiting the whole world, the negative effects of US policies of discriminating against Chinese researchers become obvious.

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Jul 12, 2024: According to an Allianz report, the "New Three" industries of electric vehicles, batteries and solar energy products are to become the main drivers of Chinese growth.

Comment MCC: This should be good for the chemical industry as all these industries require substantial chemical input.

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Jul 11, 2024: Beijing News reported that Sinograin was using tankers to transport both fuel and food products like cooking oil, soybean oil and syrup, without cleaning the tankers in between.

Comment MCC: That is the kind of news that leads to situations where Chinese do not dare to give their babies domestically made baby food, instead asking their foreign friends to buy it overseas for them instead ...

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Jul 10, 2024: AkzoNobel has started a new production line for marine and protective coatings at their Suzhou site, adding almost 40% of capacities to be followed by more additions.

Comment MCC: News showing the ongoing attraction of China for chemical companies - but why do the company statements always have to be so boring? "The continuous investments in Suzhou reaffirm our commitment to delivering the best solutions, quality, and service to our customers" and "The strategic enhancements we're making will also enable us to adapt faster to the dynamic Chinese market." ChatGPT could not have said it any better ...

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Jul 09, 2024: According to Paylab, the gross salary range for people working in China in the Chemical Industry is typically from 4,985 CNY (minimum salary) to 11,243 CNY (highest average, actual maximum salary is higher).

Comment MCC: Figures are higher for chemical engineers (6-13 k CNY) and chemists (4.7-13.6 k CNY) but still seem low compared to what I hear from the market. With an average salary of 7.9 k CNY, the chemical industry is somewhere at the lower end among industries, below industries such as banking (10.3 k CNY) and telecommunication (10.5 k CNY) but above industries such as agriculture (7.1 k CNY)

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Jul 08, 2024: According to Reuters, China will add nearly 60 million barrels of crude oil to the country's emergency stockpiles

Comment MCC: As in other areas, the Chinese government is generally very concerned about supply security and aims to create buffers - even though this addition only adds about 4 days of daily consumption of crude oil.

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Jul 07, 2024: Construction has begun on a green hydrogen and ammonia project in northern China. 1GW of alkaline electrolysers will be powered by 1.25GW of new wind power and 1.15GW of solar.

Comment MCC: The builder is a state-owned company that has its main business in coal but obviously also has an interest in alternative energy sources.

https://www.hydrogeninsight.com/production/construction-begins-on-2-6bn-...

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Jul 06, 2024: According to the American Chemistry Council (ACC), a mid-size EV contains approximately 45% more plastic than a similarly sized fuel-powered vehicle. The ACC report also states that the value of chemistry in a vehicle has increased by 31% from a decade earlier and that the plastic and polymer composites are up more than 18% from a decade ago and now account for approximately 10% of a vehicle's weight yet 50% of its volume.

Comment MCC: With the production of EVs currently mainly focused on China, this should lead to increasing demand for the relevant polymers in the country.

https://www.chemicalprocessing.com/industrynews/news/55040082/acc-report...

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Jul 05, 2024: China is forecast to meet its 2030 renewable energy targets by the end of 2024, according to the South China Morning Post

Comment MCC: Both solar and wind energy grow much faster than planned - China added 217GW of solar power and 76GW of wind power capacity in 2023. Of course, this increases demand for the chemical materials utilized in the production of the relevant equipment.

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Jul 04, 2024: The Ministry of Ecology and Environment released draft rules tightening the carbon allowances for the national Emissions Trading System

Comment MCC: The tightening is aimed at speeding up the emission reduction by reducing the quotas. Previously, prices were quite low and thus did little to reduce emissions.

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Jul 03, 2024: Chinese polycarbonate ether producer Changhua Chemical has broken ground on the country's first carbon dioxide-based polyols plant with an initial capacity of about 80 kt

Comment MCC: The technology used (developed by UK company Econic) allows the replacement of up to 30% of the fossil-fuel-based polyol components with captured carbon dioxide - which to me sounds a bit disappointing.

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Jul 02, 2024: China enacted a new regulation on mining, smelting and trading of rare-earth metals and alloys. It aims to support the research, development and application of the rare-earth industry and prevent illegal mining

Comment MCC: This has global relevance as China accounted for about 60 percent of global rare-earth mining and close to 90 percent of processing and refining, according to the International Energy Agency.

https://www.chinadaily.com.cn/a/202407/01/WS66818199a31095c51c50b8b3.html

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Jul 01, 2024: China will continue to levy anti-dumping duties on styrene imported from the Republic of Korea (ROK), the Taiwan region and the United States for five years

Comment MCC: In the current climate, any lifting of such duties would be surprising.

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Jun 30, 2024: According to an estimate by Oilchem, Chinese smaller independent refineries operated at 55.5% of their capacity in May, up 0.8% from April 2024.

Comment MCC: These low operating rates indicate the somewhat precarious economics of these refineries, but also their function offering buffer capacity as they can easily take advantage of even slight margin improvements.

https://www.reuters.com/business/energy/china-refinery-output-slips-18-y...

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Jun 29, 2024: According to the Ministry of Ecology and Environment, the annual number of environmental emergencies dropped from around 700 in 2013 to approximately 300

Comment MCC: However, the ministry warns that risks remain, coming mainly from the production and road transportation of chemicals. According to China Daily, "Chemical spills, tailings pond breaches, fires, explosions and hazardous chemical transportation mishaps account for over 80 percent of environmental emergencies. Illegal discharges contribute about 10 percent."

https://www.chinadaily.com.cn/a/202406/25/WS667a211fa31095c51c50aa59.html

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Jun 28, 2024: The Ministry of Ecology and Environment announced a plan for carbon footprint management. The plan includes setting up an institutional system for product carbon footprint labeling, authentication, and tiered management.

Comment MCC: Initially, electricity, coal, and fuel oil will be prioritized, but by 2030, the number of key products with specific carbon footprint calculation rules and standards will increase to 200, presumably including some basic chemicals.

https://english.www.gov.cn/news/202406/11/content_WS6667b1ecc6d0868f4e8e...

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Jun 27, 2024: LyondellBasell will start up an additional PP compounding line at its Dalian site

Comment MCC: The key target application is automotive, possibly a reaction to the growing Chinese production of EVs.

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Jun 26, 2024: A recent article in The Economist discusses the rise of China as a scientific power. For example, in 2022, the share of global high-impact chemical papers (those with the top 1% number of citations) reached more than 70% for China compared to only about 15% each for the EU and the USA

Comment MCC: Given that the most profitable segments of the chemical industry are most likely the most innovative ones, and that these are also the most likely areas to be covered in high-impact papers, this is quite worrying for the long-term prospects of the chemical industry outside of China.

https://www.economist.com/science-and-technology/2024/06/12/china-has-be...

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Jun 25, 2024: The House of Representatives' select committee on China last asked the relevant government official to specify how many patents tied to U.S. government funding had been filed annually since 2010 by inventors in China. This is part of a discussion on whether to continue joint research in areas such as atmospheric and agricultural science and basic research in physics and chemistry.

Comment MCC: This endangers the pact - apparently, China bashing is more important than preventing climate change.

https://www.reuters.com/world/us/us-lawmakers-seek-china-patent-data-ami...

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Jun 24, 2024: Sika opened a new plant in Liaoning, which will manufacture a full range of products, including mortars, tile adhesives, and waterproofing solutions and from which three northeastern provinces will be supplied.

Comment MCC: Sika already has 34 manufacturing sites in China, and the addition of a site in what is generally considered not to be an economically very attractive part of China indicates how far localization has already become. Of course, this is particularly relevant for low-value products such as mortar.

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Jun 23, 2024: BASF and China BlueChemical signed a Memorandum of Understanding for a joint Green & C1 Advanced Chemical Technology Laboratory to low-carbon technologies for the chemical industry. Areas covered include CO2 to Syngas Technology (CO2TS), green methanol and green ammonia applications, generation, and purification of green hydrogen, synthesis of green olefins, the oligomerization and hydrogenation of green olefins to produce sustainable energy carriers.

Comment MCC: While BASF's investment in Zhanjiang highlights the desire of the company to be independent of Chinese partners, this cooperation shows that BASF is still willing to cooperate even in areas that seem highly strategic. This is a bit surprising to me.

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Jun 22, 2024: A new paper titled "Tracing China's agrochemical complex" with a publishing data of September (!) 2024 gives an extensive overview of China's agrochemical industry including information on key production locations, export destinations, and key actors.

Comment MCC: The paper is too extensive to be summarized easily but well worth studying if you have an interest in China's agrochemical industry. Findings include the partial shift of pesticide production from Jiangsu to inland provinces with laxer environmental regulation, industry consolidation, declining production, greater focus on environmental issues, favorable export policies, and a general upgrading of the industry. As I said, too many aspects to properly summarize in this blog.

https://www.sciencedirect.com/science/article/pii/S0305750X24001451

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Jun 21, 2024: The MIIT issued guidelines to upgrade and regulate the lithium-ion battery industry.

Comment MCC: The guidelines will scale back the mere expansion of production capacity and focus on upgrading instead - a reaction to overcapacity and declining prices combined with the desire to remain the global leader in this area.

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Jun 20, 2024: Solvay has requested the imposition of anti-dumping tariffs on vanillin from China.

Comment MCC: The dumping rate alleged in the petition is extremely high at 520%

https://www.whitecase.com/insight-alert/information-regarding-antidumpin...

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Jun 19, 2024: The Economist has an article on China's solar industry titled "China's giant solar industry is in turmoil" (see the link at the end, though it may only be accessible to subscribers)

Comment MCC: The key message is that of an overcapacity issue that keeps worsening. As a consequence, Chinese solar export revenues fell by 6% in 2023 despite rising volumes, and the stock market value of major players has dropped substantially. Similar to the situation in Chinese basic chemicals, major players react not by reducing but by expanding capacity, reckoning that the only way to survive is to reduce marginal costs via economies of scale. The article also points out that state support has contributed to the oversupply. An accompanying chart indicates that China has about 80% of global solar module capacity.

https://www.economist.com/business/2024/06/17/chinas-giant-solar-industr...

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Jun 18, 2024: S&P Global reports that "China's petrochemical market is slated to remain pressured in the first half of 2024, with the country's ailing property market and sluggish economic growth casting a gloom over the demand outlook for Asia's biggest petrochemical consumer."

Comment MCC: Apart from the rather strange phrasing ("casting a gloom over"), nothing new here.

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Jun 17, 2024: China will very likely massively overachieve its target of reaching 1,200 GW of wind and solar power by 2030, probably reaching already reaching this target in 2024 and double the amount by 2030.

Comment MCC: Rather than applauding China's efforts and their contribution to reducing global carbon emissions, Western countries will probably focus on complaining about what this means for global markets for these technologies. A strange world. Mind you - China is still a massive emitter, and some of its policies such as the pursuit of coal chemicals contradict its own stated aims in preventing climate change. Yet, the widespread use of carbon-neutral power generation - and the cheapening of its use - should be applauded.

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Jun 16, 2024: Sika opened a new plant in Liaoning, which will manufacture a full range of products, including mortars, tile adhesives, and waterproofing solutions and from which three northeastern provinces will be supplied.

Comment MCC: Sika already has 34 manufacturing sites in China, and the addition of a site in what is generally considered not to be an economically very attractive part of China indicates how far localization has already become. Of course, this is particularly relevant for low-value products such as mortar.

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Jun 15, 2024: In the first four months of 2024, CATL overtook LG as the top EV battery supplier outside China, reaching 27.4% installed capacity (from 26.9% a year earlier) while the LG share decreased to 25.7%.

Comment MCC: It seems that China's dominance in all things EV-related is unstoppable - that is, unless tariffs and other trade barriers are utilized to reduce the dominance.

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Jun 14, 2024: The EU will impose tariffs of up to 48% on electric cars from China starting in July

Comment MCC: Similar to the US, the EU now favors protecting the local industry over fighting climate change. Overall, I am quite puzzled - China providing incentives for companies in areas such as EVs and solar panels has certainly accelerated decarbonization and is probably what other countries should have done as well. But now, the country gets punished for it. Of course, this will also have an impact on the chemical companies providing much of the input for EVs.

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Jun 13, 2024: A paper by Chinese researchers compares the production of propylene via two different routes, propane dehydrogenation and coal-to-propylene, with regard to their carbon dioxide emissions.

Comment MCC: The study identifies a range of optimal carbon tax rates that can enhance the economic competitiveness of low-carbon propylene routes PDH and discourage the expansion of coal-fed CTO propylene routes. These tax rates correspond to 1-10% of the typical propylene price in the Chinese market. Implementation of such a tax could thus shift the economics of the two different routes.

https://www.sciencedirect.com/science/article/abs/pii/S0959652624022820

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Jun 12, 2024: China's imports of crude oil fell by 8.7% in May 2024 compared to one year earlier.

Comment MCC: One of the likely reasons is the growing share of electric vehicles. This will also lead to an increasing share of crude oil being turned into chemical products rather than into fuel.

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Jun 11, 2024: China's exports of PP more than doubled in the period from Jan-Apr 2024 compared to the same period in 2023 (ICIS).

Comment MCC: This is likely a consequence of increased domestic capacity and slow domestic demand. Interestingly, the share of exports to Vietnam increased from 13% to 16%, indicating a potential shift of goods manufacturing to that country - often even in Chinese-run factories.

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Jun 10, 2024: BASF Greater China revenue in 2023 accounted for 13.6% of global revenue. The company reduced its greenhouse emissions by 10.7% compared to 2022.

Comment MCC: These figures are fairly impressive. Another figure in the BASF 2023 Greater China report is less so - the company spent "more than €0.34 million on societal engagement programs in Greater China in 2023", or below 0.004%. Might have been better not to provide this figure at all.

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Jun 09, 2024: According to a paper in Nature, chemistry and physical sciences are clear areas of focus for China, accounting for 85% of the country's total Share in the Nature Index in 2023

Comment MCC: This should indicate good prospects for the innovation capacity of China's chemical industry.

https://www.nature.com/articles/d41586-024-01600-9

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Jun 08, 2024: According to a report by the Centre for European Reform, large German companies only pay lip service to de-risking in China.

Comment MCC: Here is a direct quote from the report: " The big chemical and car companies have doubled down on their investments in China - though some of the smaller firms of the Mittelstand have reduced their exposure."

https://www.cer.eu/insights/china-and-west-gap-set-grow

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Jun 07, 2024: The American Chemistry Council criticizes the US trend toward protectionism (ICIS)

Comment MCC: For example, the CEO of the ACC stated "For the chemical industry, the concern is that we're a big winner in global trade. We have a $25 billion trade surplus, and so we are a target for retaliation when we target countries, including China"

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Jun 06, 2024: Chinese recycled polymer producer Zhenjiang Ceville has started building a recycled plastic plant in Zhenjiang, Jiangsu. It includes waste bottle washing, shredding, pelleting units and PET chemical recycling to produce 100 kt/a of mechanically recycled food-grade or multi-purpose recycled PET pellets, 40 kt/a of mechanically recycled food-grade recycled PE/PP and 10 kt/a chemically recycled PET pellets.

Comment MCC: Hopefully, those aiming to procure recycled plastics will buy from such real plants rather than falling for the increasing offers of fake recycled material (virgin plastics sold as recycled to fetch a higher price).

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Jun 05, 2024: A paper by Chinese scientists examines lithium pollution and the resulting health risks in a large lithium extraction area in China

Comment MCC: The study found that indeed substantial amounts of lithium are being found in a local river, and that local residents were suffering potential chronic noncarcinogenic health risks primarily from consuming contaminated water and vegetables. Given the growing importance of lithium mining globally, these results are likely to also apply to other locations.

https://pubs.acs.org/doi/10.1021/acs.est.4c00225

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Jun 04, 2024: BASF inaugurated its second polymer dispersions production line in Huizhou, China.

Comment MCC: Among the reasons provided for the expansion are growing local demand for high-quality dispersions from customer segments such as coatings and batteries, and shortening of lead times due to a plant location near raw materials suppliers

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Jun 03, 2024: The director general of CEFIC stated that while the European industry is out of recession, it does not show much growth either, limiting the prospects of the chemical industry.

Comment MCC: In addition, he also stated that strong Chinese chemical exports are a challenge to the European industry.

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Jun 02, 2024: A team of Chinese scientists utilized machine learning to find and identify unknown perfluoroalkyl and polyfluoroalkyl substances (PFAS) in the environment (SCMP)

Comment MCC: This will help identify risks coming from PFAS that are so far unknown - and has the nice side effect of associating the scientists involved with something as fashionable as AI

https://www.scmp.com/news/china/science/article/3264016/forever-chemical...

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Jun 01, 2024: The Gulf Petrochemicals & Chemicals Association published an interesting paper discussing the impact of a Free Trade Agreement between the gulf countries of the GCC and China on the chemical industry of the GCC.

Comment MCC: The paper states that China is the biggest export destination for chemical exports from the GCC, accounting for 19% of total chemical exports in 2022, though this is down from a peak of 28% in 2019. In contrast, the GCC countries are only a relatively minor source of chemical imports from the Chinese perspective, accounting for about 5% of total imports. These imports are mainly plastics (50%) and organic chemicals (46%). Overall, the paper argues that a Free Trade Agreement could be beneficial for the chemical industry of the GCC but also warns of overreliance on a single export destination such as China, particularly in the face of China's drive toward self-sufficiency. To me, the latter point should be particularly relevant as the ongoing increase in refinery capacity in China will likely mean the country will import fewer chemicals and plastics while continuing to import crude oil.

https://www.gpca.org.ae/wp-content/uploads/2024/04/V4_Trade-position-pap...

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May 31, 2024: Sinopec released three industry reports on the future of China's petrochemical sector, "China Energy Outlook 2060 (2024 Edition)," "China Hydrogen Energy Industry Outlook," and "2024 China Energy and Chemical Industry Development Report."

Comment MCC: Highlights of the three reports are as follows: The China Energy Outlook 2060 shows a downward trend in energy consumption and carbon emissions in China, forecasting that China's coal consumption will stop growing around 2025, and oil demand will peak before 2027. The China Hydrogen Energy Industry Outlook report predicts that by 2060, China's hydrogen energy consumption will be nearing 86 million tons, and non-fossil fuel as an energy source used for making hydrogen will jump to 93 percent. The 2024 China Energy and Chemical Industry Development Report stresses the need to prioritize the conservation, intensification, and high-efficiency recycling of resources in the petrochemical industry

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May 30, 2024: Children's clothes sold by Chinese online store Shein contained toxic substances in amounts hundreds of times above acceptable levels, according to South Korean officials (SCMP)

Comment MCC: In particular, the levels of phthalates were very high - one pair of shoes contained 428 times the permitted levels of phthalates.

https://www.scmp.com/news/asia/east-asia/article/3264440/childrens-produ...

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May 29, 2024: China National Chemical Engineering group will build a refinery for the Iraq Southern Refinery Company, with an initial capacity of 300,000 barrels per day.

Comment MCC: Probably the USA had other ideas about the economic development of Iraq rather than it being a target market for Chinese engineering companies.

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May 28, 2024: BASF will invest in the expansion of its advanced additives plant at its Nanjing site.

Comment MCC: This includes Controlled Free Radical Polymerization (CFRP) dispersants and continues BASF's policy of substantial investment in China.

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May 27, 2024: AstraZeneca will build a separate Chinese supply chain to try to circumvent increased US-China tensions. To that end, the company has built a plant in Qingdao which will only serve China.

Comment MCC: This is despite drugs currently not being affected by tariffs - but it seems AstraZeneca is planning for a worst-case scenario.

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May 26, 2024: Fitch downgraded the rating of Indian agrochemicals company UPL and gave it a negative outlook

Comment MCC: The rationale provided strongly focuses on China: "Persistent oversupply from China could delay UPL's deleveraging and sustain pressure on its financial profile", "UPL's EBITDA ... has also been hit by manufacturing overcapacity in China. The chemical capacity build-up in China in the last few years has resulted in a surge in global product supply."

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May 25, 2024: China's chipmakers are aiming to localize the supply of key chip materials and chemicals to counter U.S. export controls (Nikkei)

Comment MCC: This is of course in line with the national policy of reducing the dependency on imports, particularly from the US. However, it will require substantial efforts from chipmakers and may pose a risk to the output quality, at least initially.

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May 24, 2024: An analysis of different Chinese wines by several methods including LC and GC/MS allowed the identification of 5 mineral elements, 13 volatile components, and 51 metabolites and allowed the exact determination of the origin (location) of each wine.

Comment MCC: To quote Max Goldberg, wine is what you drink when you have run out of beer.

https://www.sciencedirect.com/science/article/pii/S2590157524002992

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May 23, 2024: An article in China Daily quotes several international experts praising China's battle against pollutants. For example, Rolph Payet, executive secretary of the Secretariat of the Basel, Rotterdam and Stockholm Conventions, states "China's pivotal role in global chemical management cannot be overstated ... From ratifying amendments to implementing its national plans, China has exemplified dedication in tackling persistent organic pollutants."

Comment MCC: On the other hand, given that the source is China Daily, such praise is to be expected and does not mean there is no criticism (it would simply not have been reported in the paper). For example, Andersen is also quoted as having stated that China has phased out 29 out of 34 types of pollutants - so, 5 types of pollutants apparently have not been phased out yet.

https://www.chinadaily.com.cn/a/202405/18/WS6647efeca31082fc043c7c4a.html

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May 22, 2024: China has launched an anti-dumping investigation into Polyoxymethylene copolymer imports coming from the US, the EU, Taiwan and Japan

Comment MCC: This seems to be a response to trade barriers imposed by other countries, particularly the US. Overall, this cycle of tarriffs will hurt the global economy, though China is hardly the only country to blame. Remember Smoot-Hawley?

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May 21, 2024: A paper in Nature quantifies the amount of fossil fuels used by China's chemical industry (as a share of total Chinese consumption). In 2017, this was 5% for coal, 15% for oil and 7% for natural gas.

Comment MCC: Some of these shares are likely to be much higher now. In any case, these percentages indicate a substantial role of China's chemical industry in carbon dioxide emissions.

https://www.nature.com/articles/s41467-024-47930-0

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May 20, 2024: China's Ministry of Commerce launched an anti-dumping investigation into imports of cypermethrin, a chemical used for the production of insecticides

Comment MCC: This may partly be a reaction to the many anti-dumping investigations from the Indian side on Chinese companies.

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May 19, 2024: ICIS has a podcast covering the global oversupply of chemicals driven by China, stating that the oversupply is forecast to reach over 200 million tonnes/year by 2028

Comment MCC: Link to the podcast: https://podomatic.com/embed/html5/episode/10738800

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May 18, 2024: Shin-Etsu will build a new silicone factory in Zhejiang province, expanding its silicone business in China.

Comment MCC: The new plant will have an area twice the size of the current one, hinting at the expansion of business. This is despite the press release stating "Demand for silicones in China is currently in an adjustment phase ..." (presumably a euphemism or even a decline in business, not surprising given the slowdown of the construction business) but continues optimistically with "... but is expected to grow further in the medium to long term."

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May 17, 2024: US President Biden will substantially increase some tariffs on imports from China, including on EVs, semiconductors, and solar cells, all materials with strong input from the chemical industry.

Comment MCC: It is election season in the USA, and China-bashing is popular.

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May 16, 2024: According to CEFIC, China's global share of chemical exports increased from 4% in 2002 to 14.4% in 2022 while in the same period, the EU share dropped from 25% to 17%.

Comment MCC: However, Europe is still the leader in the global chemical export market - for now.

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May 15, 2024: Indian fluorochemicals maker SRF Ltd on May 7 reported that its specialty chemicals division has faced challenges

Comment MCC: Factors quoted include both dumping and intense competition from Chinese manufacturers, which lead SRF to suffer from price pressure and decreasing sales volumes.

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May 14, 2024: Three people died after an explosion at a nitrocellulose production workshop of a chemical company in Laohekou, Hubei province, China Central Television reported on Sunday.

Comment MCC: Apparently, the cause of the accident was the decrease in water level in the boiling and washing pot of the workshop, so some nitrocellulose lacked water. In other words, exactly the kind of accident that would not happen in a fully automated process, something that the Chinese authorities are pushing for.

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May 13, 2024: South Korea's SK Hynix will sell its foundry unit based in China to a Chinese state-owned enterprise

Comment MCC: Another example from the partial withdrawal of South Korean chemical companies from China.

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May 12, 2024: A study on the use of coal chemical waste salt for electrodialysis found that this is indeed possible if thermal pretreatment at 850 °C for 180 min is used as this completely removes organics from the waste salt, resulting in efficient control of membrane fouling

Comment MCC: Given the amount of coal chemicals produced in China, this could be a relevant finding.

https://www.sciencedirect.com/science/article/abs/pii/S0011916424002649

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May 11, 2024: An article by the GTAI (in German) lists a number of challenges to China's chemical industry, including the weakness of the property segment, the weak overall economy, price competition due to overcapacities, and rising demand for climate-friendly products

Comment MCC: In particular, according to the article, producers of basic chemicals suffer from overcapacity, low demand, and rising costs.

https://www.gtai.de/de/trade/china/branchen/herausforderungen-fuer-china...

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May 10, 2024: According to ICIS, China's demand growth for PVC averaged 10% per year between 1992 and 2023 but will only be 3% per year between 2024 and 2030.

Comment MCC: ICIS cites factors such as lower demand from the property sector as well as lower domestic consumption growth as factors.

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May 09, 2024: DOMO Chemicals inaugurated a new polyamide plant in Haiyan, Jiaxing, Zhejiang

Comment MCC: Customer industries mentioned include automotive, electronics, and energy. The new investment is based on a claimed 20% growth in annual sales.

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May 08, 2024: According to an article in the Indian Express, anti-dumping duties imposed by India seem to focus heavily on chemicals from China.

Comment MCC: While the article quotes officials stating that those anti-dumping duties hurt Indian buyers of the chemicals ("It is a rather tough call"), in reality, the government seems to be much more on the side of the domestic companies, having massively increased the percentage of cases in which anti-dumping duties are imposed.

https://indianexpress.com/article/business/economy/govt-clamps-down-on-d...

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May 07, 2024: Several Chinese-operated gold mines in Niger were temporarily closed after dozens of cattle died from drinking wastewater

Comment MCC: The deaths are believed to be due to the use of chemicals used in the mining process.

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May 06, 2024: According to a recent paper ("Analysis on application status of CCUS technology in emission reduction of modern coal chemical project in chemical industry") on carbon dioxide emission of the modern coal chemical industry, it accounted for about 23% of total emissions of China's chemical industry in 2020.

Comment MCC: It is thus an important contributor to overall emissions. On the other hand, value creation per unit of carbon dioxide released is 2-3 times higher than if the coal is used for thermal energy production.

https://www.e3s-conferences.org/articles/e3sconf/pdf/2024/50/e3sconf_ice...

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May 05, 2024: ICIS suggests that the full-year operating rate of China's PP production may only reach 75% based on extrapolating Jan-Mar production compared to the long-term average of 87%

Comment MCC: While this may turn out to be true given the buildup of overcapacities, the estimate seems risky as it includes the Chinese New Year period, which may see lower demand and/or lower production than the annual average.

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May 04, 2024: According to a recent study, China's online food delivery service creates about 847 kt of plastic waste per year, or about 1.1 kg per inhabitant in big cities and 0.4 kg elsewhere.

Comment MCC: This means large amounts of additives such as antioxidants, phthalates, and Bisphenol A are either incinerated (51 tons per year) or landfilled (another 51 tons). The study concludes "Takeout food may increase the dietary intake of phthalates and BPA by 30% to 50% and raise concerns about considerable exposure to antioxidant transformation products."

https://pubs.acs.org/doi/10.1021/acs.est.3c06345

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May 03, 2024: A paper in Outlookbusiness states that India's chemical industry failed to grasp opportunities to take away market share from China. Instead, massive capacity additions in China threaten even the existing business of Indian players, for example in agrochemicals.

Comment MCC: Among the reasons given are Chinese capacity additions, India's lack of chemical parks (though the paper wrongly states that China has 250 of them - in reality, there are about 600), lack of infrastructure, lack of economies of scale, and a focus on bulk chemicals rather than on specialties.

https://www.outlookbusiness.com/enterprise-3/feature/fault-in-the-formul...

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May 02, 2024: S&P Global Commodity Insights predicts that several crackers in Europe will have to be closed down as they are cost-competitive with others, including Chinese ones.

Comment MCC: The European crackers are on average only 25-40% of what is current word scale, and most operate on naphtha rather than on cheaper ethane. As China massively expands cracker capacity in the next few years, these European crackers will be driven out of the market.

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May 01, 2024: Sinopecs profit declined by 9% in Q1 2024, mainly due to weak performance of its petrochemicals business

Comment MCC: In particular, ethylene production declined by 2%, and the company indicated increasing competition in petrochemicals due to increased overall capacity.

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Apr 30, 2024: The NDRC is promoting the construction of decentralized rural wind power projects.

Comment MCC: This could be an interesting market for producers of materials for such projects - the market currently is more or less nonexistent but could take off given its government support.

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Apr 29, 2024: A recent paper examines how the co-production of steel and chemicals can reduce overall carbon dioxide emissions and states that it can indeed reduce emissions substantially.

Comment MCC: The paper uses modeling based on the assumption of extracting H2 and CO from steelmaking off-gas for chemical production in China.

https://www.nature.com/articles/s44286-024-00061-1

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Apr 28, 2024: According to a recent BASF analyst call, global chemical production grew by 5.4% in Q1 2024 compared to Q1 2023. The main driver was China with a growth of 9.6%

Comment MCC: This data seems to justify BASF's continuous focus on China, though the fact that chemical growth is much faster than the growth of global industrial production (+0.9%) may indicate that such a high growth rate will not continue for long.

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Apr 27, 2024: According to the National Bureau of Statistics, China's plastic products output reached 74.89 million tons in 2023, an increase of 3 percent year-on-year.

Comment MCC: These are growth rates that may be maintained for a few more years, rather than the past rates of at least twice as much.

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Apr 26, 2024: Uzbekistan's largest private oil and gas company, Saneg, and Sinopec plan to establish the world's first methanol-to-olefin gas chemical plant outside China (Nikkei)

Comment MCC: Part of the output of about 1.1 million tons of polymer per year is to be exported to Turkey and China.

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Apr 25, 2024: According to Businesstimes, Saudi Aramco is considering buying a 10% stake in Hengli Petrochemical.

Comment MCC: Given the right price, this looks like a win-win deal, with Aramco accelerating its shift into chemicals and Hengli potentially securing raw materials.

https://www.businesstimes.com.sg/companies-markets/energy-commodities/sa...

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Apr 24, 2024: Polymerupdates reports that in 2024, 81% of global new chemical capacity (by volume) will be in built in China.

Comment MCC: I am not sure how reliable the figure is, and of course by value the addition would be much lower, but as a trend statements this sounds right.

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Apr 23, 2024: A study by ITIF titled "How Innovative Is China in the Chemicals Industry?" finds that "China is leading in chemical production, especially basic chemicals. And while it is currently lagging behind on innovation-especially in more complex fine chemicals-all signs suggest it will catch up with the global leaders within the next decade or two"

Comment MCC: It also provides some interesting data on indicators such as producer share and patents by country over time. More importantly, it also cites a certain Kai Pflug: "A good summary of the Chinese position and trends is from Chinese chemical industry expert Kai Pflug, who wrote: ‘In the past, Chinese pressure on the Western chemical industry came from below-China captured more and more of the market segments with limited innovation and complexity. What is new about the current wave of Chinese domestic investments in chemicals is that these now target precisely the chemical segments that are the most innovative, which tend to also be the fastest growing ones. So far, Western chemical companies survived by out-innovating the Chinese-the latest developments show that this approach is far from certain to work in the future. In a worst-case scenario, this would only leave Western companies with smaller-volume chemicals, in which the scale-oriented Chinese players typically are less interested.'"

https://itif.org/publications/2024/04/15/how-innovative-is-china-in-the-...

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Apr 22, 2024: According to a study by Econpol, while generally fewer companies in Germany are dependent on intermediate products from China than 2 years ago, chemical companies are an exception. For chemical companies, 46 percent stated that they were dependent on inputs from China, an increase of 5 percentage points from 2022.

Comment MCC: One reason may be that Germany's chemical industry has been hit particularly hard by the increased gas prices after Russia's invasion of Ukraine, increasing demand for imports from China.

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Apr 21, 2024: A US congressional committee accused China of Tuesday of subsidizing the manufacture and export of ingredients used to make fentanyl through tax rebates

Comment MCC: This seems to be another example of China-bashing, as of course the tax rebates do not specifically cover fentanyl raw materials. Other accusations such as China notifying companies of US investigations and leaving online export-oriented content uncensored sound more serious.

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Apr 20, 2024: ICIS has a podcast on increasing anti-dumping duties on chemicals produced in China

Comment MCC: Leaders of these activities are the EU, US, India, Brazil, and South Korea, whose chemical industries struggle to compete with low-priced Chinese exports.

https://www.icis.com/explore/resources/news/2024/04/10/10988933/podcast-...

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Apr 19, 2024: According to Reuters and Xinhua, two people were killed and four injured in an explosion at a chemical plant in northwest China's Ningxia region

Comment MCC: The explosion highlights the presence of the production of chemicals from coal in remote but coal-rich regions such as Ningxia.

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Apr 18, 2024: Celanese will invest in Nanjing, including the startup of a new vinyl acetate ethylene unit and some debottlenecking for redispersible polymer powders.

Comment MCC: A US company apparently fully prepared to stay in China, and presumably competitive with Chinese competitors

https://www.chemengonline.com/celanese-announces-several-plant-startups-...

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Apr 17, 2024: The CEO of Lanxess highlighted the importance of China for the company: "The Chinese market is not just another market for Lanxess. It holds strategic significance for our global operations"

Comment MCC: Other statements emphasizing China's role include the following, which stresses the "In China for China" strategy taken by several global chemical companies: "China's role in the chemical market has evolved from being primarily a manufacturing hub to a significant consumer market. It accounts for 40 percent of global chemical sales, which is expected to approach 50 percent by 2030 ... This market shift has led Lanxess to localize products to meet the demands of China's growing middle-income group."

https://www.chinadaily.com.cn/a/202404/09/WS66149943a31082fc043c0e6b.html

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Apr 16, 2024: TotalEnergies has signed an agreement with Sinopec to produce sustainable aviation fuel in China, to be made from local waste or cooking oils and animal fats

Comment MCC: This follows recent praise in the Economist for Total as a company "that balances growth and greenery" (title of the Economist article)

https://www.economist.com/business/2024/04/04/meet-the-french-oil-major-...

https://www.ofimagazine.com/news/total-energies-and-sinopec-team-up-to-p...

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Apr 15, 2024: According to C&EN, Japanese companies continue to close plants in Japan and China due to heavy competition from Chinese players.

Comment MCC: Examples include the closure of Mitsui's phenol plant in Japan in 2026, the closure of Mitsui plants for PTA and PP in Japan in 2023, the downsizing of Mitsui's TDI plant in Japan, Sanyo's closure of a superabsorbent polymer plant in China, and DIC's withdrawal from LCD materials.

https://cen.acs.org/business/Expansion-China-hits-Japan/102/web/2024/04

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Apr 14, 2024: BASF has signed a 15-year contract with Chinese gas company ENN Energy Holdings for natural gas at BASF's integrated chemicals complex in Zhanjiang in Guangdong

Comment MCC: BASF is certainly sensitive to natural gas supply after its reliance on Russian gas turned out to be a major headache after Russia's invasion of Ukraine.

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Apr 13, 2024: Sanyo Chemical Industries will stop production at three plants in Nantong, China -superabsorbent polymer, surfactants, and urethane resins.

Comment MCC: The most likely reason is low profitability due to excess capacity and low-price competition by local players.

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Apr 12, 2024: According to ECONOMYNEXT, Sri Lanka has approved Sinopec to build a new refinery at the Hambantota port, an investment of at least $4.5 billion

Comment MCC: The refinery will supply both the local market and produce for export, strengthening China's position in the country in a region that India also has a strong interest in.

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Apr 11, 2024: Brazil is considering imposing import tariffs on some imports from China including chemicals.

Comment MCC: The Financial Times gives the example of phthalic anhydride, imports of which grew by more than 2000% between 2018 and 2023.

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Apr 10, 2024: A source named China Chemical Market Insights reports on several Wanhua investments including one in the production of menthol and one in the expansion of a catalyst treatment plant.

Comment MCC: However, the overall tone of the source is so gushing with praise for Wanhua that this is unlikely to be a truly independent source. Here is a sample: "Wanhua Chemical's visionary expansion and investment plans in Yantai epitomize the fusion of cutting-edge technology with a commitment to environmental sustainability. By championing projects that push the boundaries of chemical manufacturing, Wanhua is not just enhancing its global competitiveness but also contributing significantly to the sustainable development of the chemical industry. These initiatives herald a new era of high-quality development, with Wanhua Chemical leading the charge towards a more sustainable, innovative, and prosperous future." Reads like a parody of a company press release, not like an independent news source.

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Apr 09, 2024: While China produced about 60% of all lithium chemicals in 2023, data provider Benchmark forecasts an increasing import deficit, with 70-80% of all China-produced lithium chemicals depending on raw materials imports rather than on domestically mined rock.

Comment MCC: The intensifying efforts of China to secure lithium abroad seem to indicate that these forecasts are broadly correct.

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Apr 08, 2024: According to Chemical Week, lithium producer Albemarle expects global EV penetration to increase from 17% in 2023 to 23% this year and to reach 50% in 2030. This would mean the demand for lithium carbonate will increase from 1.3 million tons in 2024 to 3.3 million tons in 2030.

Comment MCC: However, as many companies have started activities in this area, prices have fallen substantially.

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Apr 07, 2024: Oxford Economics expects chemicals and pharmaceuticals to be the second-fastest growing segment within Chinese manufacturing, as measured by gross value-added growth in 2024.

Comment MCC: Factors cited include increased Chinese output in new industries such as EVs, batteries, and renewables, all segments closely linked to the chemical industry.

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Apr 06, 2024: The USA wants Japanese companies to limit exports to China of specialty chemicals used for chipmaking, including photoresist

Comment MCC: Obviously, the affected companies are not enthusiastic about these initiatives - and given the increasing restraints the US imposes on free trade in general, why should they?

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Apr 06, 2024: BASF will change the name of two dispersions plants, BASF Paper Chemicals Huizhou and BASF Paper Chemicals Jiangsu, to BASF Specialty Material Huizhou and BASF Specialty Material Jiangsu.

Comment MCC: While the official rationale is the wider product range of these plants, a more likely reason is that specialty chemicals are regarded as higher-end and higher-margin than the subsegment of paper chemicals.

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Apr 05, 2024: China Daily writes that "Multinational chemical manufacturers are looking at further opportunities to invest in China, business executives and experts said, as the country's commitment to build a modern industrial system and accelerate the development of new quality productive forces inject fresh impetus into its high-quality economic development."

Comment MCC: Companies providing positive statements on chemical investment in China include AkzoNobel and Clariant.

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Apr 05, 2024: According to chemanalyst.com, LyondellBasell restarted its PE and PP production in China, but only at a technically minimal level.

Comment MCC: Apparently, while demand is somewhat up, profitability is still low or even negative, so restarting production is more to keep the company's options open than to earn money.

https://www.chemanalyst.com/NewsAndDeals/NewsDetails/bora-lyondellbasell...

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Apr 04, 2024: A report issued by GBReports states that Mexico's chemical industry is well-positioned for nearshoring-driven growth.

Comment MCC: In particular, chemicals currently imported to the US from China might be produced in Mexico in the future. For some chemicals, this is already the case - though this also includes undesirable ones such as fentanyl.

https://www.gbreports.com/publication/mexico-chemicals-2024

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Apr 04, 2024: BASF has broken ground on a methyl glycols plant at its Verbund site in Zhanjiang, China

Comment MCC: As typical for BASF, the plant is backward integrated. And as typical for more recent developments, the key market for the product is the local one (for braking fluids).

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Apr 03, 2024: Chinese president Xi Jinping recently visited BASF Shanshan Battery Materials in Hunan

Comment MCC: This of course indicates high-level support for BASF and must come as a relief to BASF - apparently, their pullout of the Xinjiang JVs is not being held against them by the Chinese government. It seems Xi is eager to demonstrate China's openness to foreign investment, particularly in new and rapidly growing areas such as battery materials.

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Apr 03, 2024: According to PWC/ Strategy&, 2022 and 2023 are the first years in history in which Germany had a negative chemical trade balance with China (volume and value)

Comment MCC: Of course, this is partly due to localization of production by German companies.

https://www.strategyand.pwc.com/de/en/industries/energy-utilities/the-st...

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Apr 02, 2024: An Australian miner of manganese ore will produce the resulting battery-grade manganese sulfate in China for a number of reasons including China's cost advantage

Comment MCC: Other reasons provided by the company for producing in China rather than in Australia include the faster speed (quicker registration, existing chemical parks), cheaper investment and operational costs, and the greater demand for the product in China.

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Apr 01, 2024: Perstorp bought out its Chinese minority partner for polyol production in Shandong.

Comment MCC: As this and other recent examples such as the BASF exit from Xinjiang JVs indicate, it may get harder and harder to align the interests of Western and Chinese JV partners not only with regard to political aspects, but also with regard to the extent of investing in sustainability, safety and reduction of carbon dioxide emissions. The only long-term solution then is the exit of one of the JV partners.

https://www.perstorp.com/en/news_center/pressreleases/2024/perstorp_buys_out_minority_partner_at_china_site

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Apr 01, 2024: A legislative initiative by US congressional leaders would block China from buying oil from the US Strategic Petroleum Reserve.

Comment MCC: Of course, this is a purely symbolic initiative with no practical implications but allows US politicians to bolster their China-bashing credentials without any cost to them.

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Mar 31, 2024: Evonik stresses the importance of China, with the CEO stating that "The Asian market, represented by China, has always been a driving force for the global economy and an important growth market for Evonik. Evonik regards China as one of the driving forces of the global economy"

Comment MCC: In the past, Evonik has been a relative laggard with regard to China. In 2023, only about 20% of its revenue came from Asia, and only about 8% from China, substantially lower than some of its peers and of course miles away from China's share of the total chemical market of around 45%.

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Mar 30, 2024: Syngenta withdrew its listing on the Shanghai Stock Exchange

Comment MCC: This listing had already been postponed for a few years - presumably the company was waiting for an improvement in market conditions. Instead, if anything, market conditions got worse.

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Mar 29, 2024: China has about 52% of global titanium dioxide capacity (CCR)

Comment MCC: The reasonably high operating rate of 79% thus can only be maintained by exporting a substantial share (37%) of the domestic production.

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Mar 28, 2024: Two weight loss and diabetes drugs marketed by Eli Lilly may become harder to manufacture as some of their active ingredients are produced by Chinese company WuXi AppTec, a company targeted by US politicians.

Comment MCC: The law of unintended consequences coming into full force.

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Mar 27, 2024: China plans to increase its spending on science and technology by 10% compared to 2023.

Comment MCC: The main objective seems to be to reduce dependency on imports for goods and technologies deemed strategic, such as ai and semiconductors.

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Mar 26, 2024: An article in C&EN states that the global center of mass in aromatic chemical manufacturing is shifting toward China. One example given is the petrochemical complex of ZPC with a large refining capacity of 20 million tons per year and an extraordinarily high share of chemical output (40% vs. the typical 15-20%).

Comment MCC: As pointed out in the paper, this capacity increase has led many European players to reduce production of chemicals affected by Chinese capacities as margins shrank or even evaporated completely.

https://cen.acs.org/business/petrochemicals/China-aromatics-building-boo...

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Mar 25, 2024: According to AgriBusiness Global Direct, China dominates the global agrochemical sector as more than 50% of all active agrochemicals originate from China or contain critical components sourced from the country.

Comment MCC: Another chemical area in which indeed the world very much depends on China, for better or worse.

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Mar 24, 2024: UBE will invest $500 million to build a US plant for dimethyl carbonate (DMC) and ethyl methyl carbonate, both important ingredients in electric vehicle lithium-ion batteries.

Comment MCC: While the press statements claim that the project is "intended to bolster the domestic battery components supply chain by reducing the current heavy reliance on Chinese imports", this is probably less of a rationale for a Japanese company such as UBE. US subsidies are a more likely candidate.

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Mar 23, 2024: According to the Korea Times, "A growing number of Korean petrochemical companies are halting investments and considering selling their unprofitable facilities to cope with the lingering industry downturn resulting mainly from the oversupply of Chinese products"

Comment MCC: Examples include LG Chem trying to sell one of its naphtha cracking plants and Lotte trying to sell Malaysia-based Lotte Chemical Titan. However, given the overcapacities in China, it will be hard to find buyers for these assets.

https://www.koreatimes.co.kr/www/tech/2024/03/129_370471.html

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Mar 22, 2024: According to Eurostat, the segment "organo-inorganic and related compounds" (materials used as catalysts in chemical reactions) saw the biggest decline in Chinese exports to the EU in 2023 (-€13 billion; 45.4% less than in 2022).

Comment MCC: Unfortunately, I can only speculate about the reasons for this steep decline - lower demand may be one factor, competition from other import countries another, while the third (bigger production capacity within the EU) seems intuitively less likely to me. Any comments on this are very welcome.

https://ec.europa.eu/eurostat/fr/web/products-eurostat-news/w/ddn-20240304-2

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Mar 21, 2024: Arlanxeo will build a 5 kt (2.5 t in the first phase) hydrogenated nitrile butadiene rubber (HNBR) plant in Changzhou, China.

Comment MCC: The CEO statement related to the investment highlights China's status as a perceived high-growth market.

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Mar 20, 2024: According to Oxford Economics, while overall imports into the EU from China decreased by 23% in 2023, they increased in the chemical area (+24%).

Comment MCC: Another area of increase is motor vehicles (+327%), presumably driven by EV imports, which should also have a knock-on effect on the chemical industry in Europe (loss of demand).

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Mar 19, 2024: According to the CNPC's Economics & Technology Research Institute, China's refining capacity will rise by 2.7% in 2024, a faster growth than the estimated growth in throughput of 1.8%.

Comment MCC: This means increasing pressure to export petrochemical products now and also in the future, as demand is expected to peak in 2024 or 2025 at well below 45% of refining capacity.

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Mar 18, 2024: A paper analyzes the application of green hydrogen in China's chemical industry and concludes that both raw material substitution and process substitution have high technical feasibility.

Comment MCC: However, the paper is marred by weird and convoluted sentences such as "Furthermore, this study found significant homogeneity problems with the green hydrogen chemical industry in real-world deployments, emphasizing the need to strengthen top-level design in policymaking." You tell me what that means.

https://www.sciencedirect.com/science/article/abs/pii/S0360319924004063

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Mar 17, 2024: China is the largest trading partner of the Gulf Cooperation Council countries, accounting for 26% of its exports.

Comment MCC: Interestingly, the trade balance has recently shifted somewhat toward China - mostly driven by a strong increase of GCC imports from China. See the original source for detailed data.

https://www.gpca.org.ae/2024/02/28/shaping-the-future-the-gccs-and-china...

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Mar 16, 2024: Sabic reported a loss for 2023, the first since 1996. The company attributes the loss to the usual "challenging operating environment" but also to losses associated with the divestment of a steel plant.

Comment MCC: The press release reporting the result also indicates the future focus of Sabic - developing new technology to turn crude oil into chemicals and building a strong position in China.

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Mar 15, 2024: Euractiv warns about the danger of new EU regulation which would define post-consumer plastic waste as waste coming from either a member state or a third country.

Comment MCC: At first glance, such regulation makes sense, and part of the objections certainly come from the protectionist sentiment of European players. On the other hand, as virgin plastic is cheaper than recycled material, "recycled" material coming from China sometimes is not recycled at all, so accepting it at face value as recycled does nothing for the environment.

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Mar 14, 2024: Inner Mongolia will allow renewable-based hydrogen projects outside the designated chemical industrial zones and eliminate the requirements for licenses of dangerous goods production

Comment MCC: This should help accelerate such projects, of which Inner Mongolia has about 30% of China's total. The lifting is restricted to renewable hydrogen and thus clearly is a political measure rather than one based on technical considerations. Presumably, the objective is to establish Inner Mongolia as a center for such production, which should be helped by the large geographical expansion and low population of the province.

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Mar 13, 2024: The Shanghai government recently published a list of 378 major carbon-emitting enterprises in the city that will fall under its carbon emissions trading scheme. The list includes the Shanghai Chemical Industry Park Development Co.

Comment MCC: Initially, Shanghai will allocate free carbon emission quotas based on emissions intensity benchmarks for each industry and firms' actual production levels. These benchmarks will be progressively tightened each year.

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Mar 12, 2024: In 2024, ExxonMobil will invest an additional US$1.4 billion, into its Huizhou, Guangdong, China, ethylene chemical plant.

Comment MCC: This is in addition to the approximately US$10 billion already invested, indicating an ongoing commitment to China despite the growing political tensions between the USA and China.

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Mar 11, 2024: Between 2012 and 2022, China's market share in global chemicals increased from 31.3% to 440% while India's decreased from 5.9% to 4.2%. Even in the period from 2017, when China's chemical industry started to get affected by tightened environmental regulation and subsequent plant closures, to 2022, China's market share increased while India's declined.

Comment MCC: This is a substantial blow to the hopes of India's chemical companies to benefit from issues of China's chemical industry and the China+1 strategy expected to be adopted by customers then.
Another source (bnnbreaking.com) highlights the current plight of India's chemical companies: "The financial performance of Indian chemical companies reflects the sector's ongoing struggles. Recent quarterly earnings reports have shown a troubling trend, with many companies reporting their lowest sales since the COVID-19 outbreak. Additionally, a significant number of firms have experienced declines in both revenues and margins, highlighting the intense competitive pressures and operational challenges they face. The sector's difficulties are further compounded by the delayed expectation of a demand revival, casting a shadow over the future outlook for Indian chemical firms."

https://bnnbreaking.com/world/china/india-struggles-to-match-china-in-global-chemical-market-amid-rising-competition

https://www.moneycontrol.com/news/business/markets/indian-chemical-players-had-big-hopes-riding-on-china1-but-reality-dashes-them-12397451.html

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Mar 10, 2024: According to S&P Global, China's share of global exports of lithium-ion batteries increased from 44% to 68% between 2019 and 2023. S&P further predicts that by 2030, China will control at least 70% of battery and raw material production, reaching over 80% in selected areas such as cobalt and graphite

Comment MCC: This may lead to Western governments having to prioritize one of two goals, speeding up the energy transition and reducing dependence on China.

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Mar 09, 2024: US additives producer SI Group will end its own manufacturing in Jinshan, China, and instead start a supply partnership with a local partner, Liaoning Dingjide Petrochemical.

Comment MCC: While not very clear on the subject, the company announcement hints at a challenging business in China as it talks about optimizing the footprint and variabilizing the cost structure. This is one of the few examples so far in which major Western chemical companies actually seem to reduce their China presence.

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Mar 08, 2024: China Daily cites Mr. Brudermueller, the CEO of BASF, with some very positive statements on BASF and its presence in Guangdong: "BASF has always been firmly optimistic about Guangdong and investing in the province, hoping to focus on the development of the entire green petrochemical industry chain, and further expand cooperation between the two sides in areas such as technological innovation, process research and development, green environmental protection and intelligent manufacturing ... BASF will further enhance its innovation capabilities in the southern Chinese region, helping customers reduce carbon emissions, conserve energy and promote environmentally friendly production."

Comment MCC: Indeed, BASF seems firmly committed to China even though this may be seen as somewhat out of line with German government policy.

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Mar 07, 2024: According to americanjournalnews.com, multiple Republican congresspeople who criticized China also took campaign cash from Syngenta, a state-owned Chinese chemical company located in Switzerland.

Comment MCC: One example provided is Republican Don Bacon from Nevada, who between 2020 and 2023 took USD 5500 from Syngenta while at the same time stating that "American farmland should never be owned by China", conveniently ignoring the fact that Syngenta owns about 1500 acres of US farmland. Or is that money does not smell after all?

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Mar 06, 2024: In an article on guancha.cn, Chen Jing gives his view on the Indian versus the Chinese chemical industry (machine translation): "Chemicals are one of India's largest export categories. In 2022, India's agrochemical exports were US$5.5 billion, surpassing the United States to become second, and China ranked first with US$11.1 billion. Indian media reported that India plans to surpass China and become the world's largest chemical manufacturing center. This is of course funny. China will account for 43% of global industrial output in 2021 and plans to account for 50% in 2030. India often makes this kind of boastful propaganda against China, but it is not completely unfounded. There is a sizable industry there. Indians now know that China is powerful, but they are not convinced yet and feel that they can catch up and surpass it."

Comment MCC: While Chen Jing still seems very confident about the long-term superiority of China's chemical industry, he also seems to acknowledge a gradual strengthening of India's.

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Mar 05, 2024: According to Statista, the total value of global chemical imports increased from 1.3 billion dollars in 2020 to 1.8 trillion dollars in 2022.

Comment MCC: While this may sound like a substantial increase, the fact that the average oil price in 2020 was about 42 USD and 101 USD in 2022 (again, according to Statista) makes this increase much less impressive.

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Mar 04, 2024: Evonik has invested via its Venture Capital unit in the Chinese company JLand Biotech, which specializes in the development and production of vegan collagen.

Comment MCC: According to the press release, this will provide Evonik with collagen for products such as anti-aging and hydrating creams, masks, and gels.

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Mar 03, 2024: BASF expects growth in China to lift earnings before interest, taxes and special items to as €8.6 billion in 2024, up from €7.7 billion. BASF will also cut costs in Germany.

Comment MCC: Statements like this explain BASF's strong focus on China despite the potential political issues this engagement carries.

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Mar 02, 2024: In, 2023, China's lithium carbonate production increased by 31% while production capacity increased by 83%.

Comment MCC: This divergence between production growth and capacity growth also explains the substantial drop (more than 80%) in lithium prices.

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Mar 01, 2024: A recent paper discusses the technological progress and the subsequent environmental benefits due to advances in coal-to-olefins processes.

Comment MCC: While some of the progress cited in the paper is impressive, the fact remains that essentially, coal is dug out of the earth and - possibly via some intermediate chemicals - released into the atmosphere as carbon dioxide, even though the amount of this can be reduced, for example by using green hydrogen.

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Feb 29, 2024: According to Xinhua News, German firms see the chemical industry as the most optimistic sector in China, with about 90% of respondents seeing an increase in the industry in the next 5 years.

Comment MCC: This is based on a survey by the German Chamber of Commerce in China, according to Xinhua.

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Feb 28, 2024: An article on Chinadialogue discusses the damages caused by road salts in China.

Comment MCC: For example, the article cites the (far too precise) point that "[in] China, from 2005 to 2020, car companies recalled and repaired 430,000 vehicles due to chloride salt corrosion."

https://chinadialogue.net/en/cities/road-salt-protecting-chinas-drivers-but-at-what-cost/

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Feb 27, 2024: According to Chemicalindustryjournal.co.uk, China's imports of ethylene derivatives have fallen by about 20% between 2020 and 2023.

Comment MCC: This is largely due to capacity increases for these materials in China itself - the source states that while China is the largest importer of chemicals, it has also been the location for around 75% of olefin and aromatics capacity additions between 2020-2024

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Feb 26, 2024: Sumitomo Chemical will suspend some production lines for polarizers (light filters attached to LCD screens)

Comment MCC: The reasons include a drop in demand for TVs and - probably more importantly - increased competition from Chinese producers

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Feb 25, 2024: According to the CCR, domestic PA6 capacity will continue to rise as new plants come onstream from 2023 to 2027, leading to increased overcapacity.

Comment MCC: However, while this will decrease the amount of imported PA6, China will still rely on imports of high-end PA6.

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Feb 24, 2024: Chinese bisphenol A (BPA) capacity grew at a CAGR of 20.5% between 2010 and 2023 while output grew at a CAGR of 18.5%.

Comment MCC: As a consequence, China now has about half of the global capacity of BPA, up from about 7% in 2010. China had a self-sufficiency rate of about 40% in 2011, which has now increased to about 100% despite the much larger demand for BPA due to the increased local production of materials such as PC.

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Feb 23, 2024: BYD started construction of a sodium-ion battery project, an investment of about 10 billion RMB.

Comment MCC: Sodium-ion batteries have several potential advantages over the lithium-based batteries currently used, such as cost-effectiveness and a more abundant raw material. However, there are also substantial disadvantages regarding energy density, cycle life, and the maturity of the technology. It seems BYD is taking at least a partial bet on overcoming these challenges.

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Feb 22, 2024: China's Ministry of Commerce will retain anti-dumping duties on imports of o-chloro-p-nitroaniline originating in India

Comment MCC: The source of this information, the Chinese paper Global Times, states that this is "a move that experts said is a legitimate response to concerns raised by domestic producers" - but then, this is what a Chinese paper would say anyway. On the other hand, according to the same source, during the period from 1995 to 2023, India launched 336 antidumping investigations against China while China only launched 12 against India, though these were mostly in chemicals.

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Feb 21, 2024: According to TASS, Russia sees huge prospects in cooperation with China in the chemical industry and trade in fertilizers

Comment MCC: The Russian Ambassador to Beijing Igor Morgulov is quoted as having said in a TV interview "Apart from energy there are other sectors where I see huge prospects, those being the chemical industry, production of the paper industry, fertilizers, various types of metals and ore"

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Feb 20, 2024: According to ChemAnalyst, Chinese PX imports declined by 14% in December 2023 compared to December 2022.

Comment MCC: This is an obvious consequence of the increasing domestic PX capacity.

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Feb 19, 2024: Canadian company Neo Magnequench started construction of a plant for rare earths permanent magnets in Estonia.

Comment MCC: This is in the interest of the EU in order to reduce dependency on China for these materials, which currently is about 98%.

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Feb 18, 2024: China's acetone capacity increased by 51% in 2023 compared to 2022, with 8 new plants coming on stream.

Comment MCC: Correspondingly, imports decreased by 43%, and China is already close to 90% self-sufficiency after less than 80% in 2022.

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Feb 17, 2024: China's MDI capacity increased at a CAGR of 6.9% between 2018 and 2022 and actual output increased by a similar CAGRd (6.8%). However, domestic consumption only increased by a CAGR of 4.1% (data from CCR).

Comment MCC: As China gets self-sufficient for some chemicals, for other such as MDI, for which the country is already self-sufficient, the pressure to seek exports increases. This will affect foreign producers in their home and export markets.

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Feb 16, 2024: As a destination for South Korea's exports of petroleum products, China dropped from fourth place in 2022 to fifth in 2023 after ranking number one from 2016 to 2021.

Comment MCC: This is even more surprising given that the drop in 2022 was associated with Covid-19, and shows that China's growing domestic production capacity strongly affects selected other countries

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Feb 15, 2024: Despite the announced exit from two JVs in China, BASF aims to increase its presence in China. According to the CFO, BASF targets achieving 20% of its global sales from China in 2030, up from around 15% now.

Comment MCC: Given the continued investment in China, this seems plausible. BASF expects around 80% of global chemical growth to 2030 coming from China.

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Feb 14, 2024: In 2023, 45 hazardous chemical enterprises in urban densely populated areas of Hunan were relocated while 34 chemical companies along the Yangtze River were moved to chemical parks (CCR)

Comment MCC: It seems Hunan will easily achieve its targets for these relocations as after 3 years of a 5-year program, 89% of firms have already been relocated.

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Feb 13, 2024: Solvay is expanding the capacity of its joint-venture hydrogen peroxide plant in Shandong

Comment MCC: The demand driver is the production of solar cells, for which hydrogen peroxide is used as a cleaning agent. According to Solvay, China is the world's largest market for hydrogen peroxide.

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Feb 12, 2024: BASF will sell its stakes in two joint ventures in Xinjiang. The local JV partner as been accused of human rights abuses by human rights groups

Comment MCC: While BASF claims that these divestures are mainly due to environmental and economic reasons, the real driver very likely is the criticism mentioned above. Of course, with its huge investments in China, BASF is very careful to openly address these charges.

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Feb 11, 2024: BASF Environmental Catalyst and Metal Solutions and Heraeus Precious Metals have started operations at a new JV plant, BASF HERAEUS Metal Resource in Pinghu, China.

Comment MCC: According to the press release, the "facility recovers precious metals from spent automotive catalysts, enabling a circular economy, while supporting China's security of supply and sustainability goals."

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Feb 10, 2024: Two major Chinese chemical companies, ChemChina and CNOOC, are on a US list of "Entities Identified as Chinese Military Companies Operating in the United States"

Comment MCC: This seems a bit weird as the main focus of these two companies - similar to China Mobile, which is also on the list - is not in the military area.

https://media.defense.gov/2024/Jan/31/2003384819/-1/-1/0/1260H-LIST.PDF

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Feb 09, 2024: BASF inaugurated a Thermoplastic Polyurethane (TPU) plant at the Zhanjiang Verbund site.

Comment MCC: The fact that this is the largest single TPU production line for BASF globally once again underlines China's unique position as the biggest chemical market by far.

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Feb 08, 2024: According to Japanese law firm Sonoda & Kobayashi, since 2020, China and South Korea have surpassed Japan in yearly patent applications for perovskite solar cells: "In 2021, China submitted 70 applications, South Korea submitted 39, and Japan submitted only 19."

Comment MCC: The law firm warns that if the current situation persists, China will be superior to Japan in this field despite the efforts of Japanese companies such as Panasonic, Sekisui, and Toshiba.

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Feb 07, 2024: Sasol reported "challenging market conditions" for its chemicals business, with average sales prices in their 1H FY 24 being 24% lower than one year earlier.

Comment MCC: Among the factors cited are macroeconomic weaknesses in Europe and China.

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Feb 06, 2024: BASF again gets criticized by the German media (ZDF, Spiegel) for being involved in human rights violations via its Xinjiang JV partner Markor.

Comment MCC: As commented on before, this is a difficult situation for BASF as the company - with its big and increasing investments in China - cannot afford to offend the Chinese government, but its image in the West may suffer from these accusations. In reality, BASF has presumably very limited influence on the actions of its Chinese JV partner, so only an exit from the JV would keep BASF from facing similar accusations in the future.

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Feb 05, 2024: China's output of refined oil products increased by 16.5% in 2023 after a growth rate of 13.3% in 2022.

Comment MCC: This is mainly a reflection of China's increased capacity and its aim to reach a greater degree of self-sufficiency rather than of greater demand.

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Feb 04, 2024: BASF will cooperate with China's Envision Energy to develop a process for converting green hydrogen and CO2 into e-methanol. BASF will provide the catalyst technology while Envision will be responsible for the overall process design.

Comment MCC: The demand for such sustainable fuels will increase substantially in the future due to EU legislation requiring a share of the fuel used in aircraft and ships to be sustainably sourced.

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Feb 03, 2024: A recent paper by Chinese authors covers the topic "Fine-tuning Large Language Models for Chemical Text Mining"and states that "The fine-tuned LLMs models demonstrated impressive performance, significantly reducing the need for repetitive and extensive prompt engineering experiments". It concludes "Given its versatility, robustness, and low-code capability, leveraging fine-tuned LLMs as flexible and effective toolkits for automated data acquisition could revolutionize chemical knowledge extraction."

Comment MCC: This is certainly an interesting topic for the chemical industry - according to the authors, AI has a huge potential. My only gripe is that the paper has 17 authors - were there really 17 people doing substantial work on this paper, or did a number of people catch a free ride due to their position in the hierarchy?

https://chemrxiv.org/engage/chemrxiv/article-details/65baa07b9138d231612...

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Feb 02, 2024: According to Oxfordenergy, China's coal chemical industry accounts for about 5.4% of China's emissions of carbon dioxide. The site highlights the political importance of the sector for China: "As coal chemicals' potential to slow China's rising oil and gas imports bodes well with Chinese leadership's rising energy security anxiety amid geopolitical tensions, coupled with strong political desire for investment-driven growth exaggerated by a sluggish post-pandemic economic recovery, especially at the local level, the coal chemical industry becomes the only major coal consuming sector in China that still possesses great potential for substantial capacity expansion as well as emissions spike in the coming decades."

Comment MCC: However, it also wonders about the contradictions in China's policy: "Without an appropriate decarbonisation strategy in place, further expansion of the industry is expected to contradict with China's dual carbon goals of peaking national carbon emissions before 2030, and achieving carbon neutrality before 2060."

https://www.oxfordenergy.org/research/prospects-of-the-chinese-coal-chemical-industry-in-an-increasingly-carbon-constrained-world/
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Feb 01, 2024: According to the China Ecological Environment Bulletin of 2020, agricultural chemicals contribute to 50 % of the environmental pollution sources in China

Comment MCC: A surprisingly high number hinting at the greater need for control of the use of these chemicals. Interestingly, in another study, it was found that once non-local employment in a given agricultural area rises, the amount of fertilizer used decreases. In other words, urban migration may itself alleviate the problem somewhat.

https://www.sciencedirect.com/science/article/abs/pii/S0959652624001677

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Jan 31, 2024: SABIC announced the final investment decision for its $6.4 billion petrochemicals complex in Fujian, China. This is a 51%/49% JV with Fujian Fuhua Gulei Petrochemical to build a mixed feed steam cracker with a production capacity of up to 1.8 million mt/year of ethylene and subsequent production of PE, PP, and PC.

Comment MCC: This again shows the determination of SABIC to move further into chemicals - and to rely on China as a major market.

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Jan 30, 2024: A US-China working group will meet in Beijing to discuss fentanyl precursor chemicals

Comment MCC: According to one official, China has already started taking action against the producers of such chemicals since last November, when Mr. Biden and Mr. Xi met.

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Jan 29, 2024: BASF Monomers Division and Xuchuan Chemical plan to cooperate on bio-mass balanced (BMB) Methylene Diphenyl Di-isocyanate (MDI) in synthetic leather applications

Comment MCC: The stated objective is to reduce carbon emissions in the production of polyurethanes for the industry.

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Jan 28, 2024: Sinopec and BP signed a memorandum of understanding at the World Economic Forum in Davos, Switzerland, on Thursday, covering cooperation in areas including fuel sales, oil, and gas trading, marine fuel and upstream activities.

Comment MCC: BP's interest is likely to gain an entry into the charging of EVs in China, for which demand is growing fast.

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Jan 27, 2024: According to Nikkei, Japanese production of ethylene is the lowest in 35 years, falling by 1.7% last year

Comment MCC: The main explanation provided is China's fast-growing capacity - and indeed, it is hard to imagine how Korean and Japanese producers of basic petrochemical products can in the long run keep relying on exports to China for a substantial part of their sales.

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Jan 26, 2024: DuPont issued a profit warning, citing weak demand in China as a major reason

Comment MCC: Apparently, DuPont expects a fourth-quarter 2023 loss and lower-than-expected 2024 first-quarter sales

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Jan 25, 2024: According to Reuters, Germany's chemicals sector is starting to get affected by delayed shipments via the Red Sea

Comment MCC: The article quotes one owner of a German chemical business, Gechem, stating that procuring necessary materials has gotten much harder recently and continues that "As a result of the delays, Gechem, which makes annual sales in the double-digit millions of euros, has lowered production of dishwasher and toilet tablets because it can't get enough trisodium citrate as well as sulfamic and citric acid." Of course, a large share of these materials comes from China.

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Jan 24, 2024: China will initiate a three-year campaign in 2024 to tackle workplace safety risks in areas from mining to firefighting.

Comment MCC: This will include the formulation of emergency disposal codes for chemical enterprises

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Jan 23, 2024: According to the CEO of Intel, China's semiconductor industry lags behind the global standard by about ten years, and he foresees this gap persisting for the next decade.

Comment MCC: A partial reason for the gap is the lack of chemicals such as resists, highly purified gases, and other chemicals used to manufacture advanced chips.

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Jan 22, 2024: An article by US News includes 3 mainland Chinese universities among the 10 best chemistry universities, along with 4 US ones, 2 Singaporean ones, and one in Saudi Arabia.

Comment MCC: It is a bit of a surprise to see this - for example, to have Tsinghua ranked higher than Berkeley - but presumably reflects a genuine improvement in the quality of Chinese chemistry universities.

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Jan 21, 2024: According to chemanalyst.com, the expansion of China's petrochemical companies raises concerns in the Korean chemical sector.

Comment MCC: In particular, apparently Rongsheng Petrochemical plans to invest $12.2 billion in a refinery and petrochemical project located in China's Zhoushan Islands. The chemicals to be produced there overlap substantially with those of Korean companies and include EO, POE, phenol, acetone, PO, styrene, 1,4-butanediol and ABS. In ABS, the new plant will directly compete with Korean companies such as Lotte, LG and Kumho.

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Jan 20, 2024: China's crude oil imports increased by 11% in 2023 compared to 2022.

Comment MCC: This figure also represents an annual record, being about 9% higher than the import volume of 2020.

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Jan 19, 2024: China's PDH capacity will rise substantially in 2024 and 2025, up 77% from the end of 2023 (Mysteel).

Comment MCC: While delays and poor margins will delay the startup of some of these capacities, the capacities coming on stream in time will still add about 50% to the current capacity.

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Jan 18, 2024: A study by ResearchAndMarkets forecasts a CAGR of 12.4% for China's market for industrial wastewater treatment between 2022 and 2030.

Comment MCC: While such market studies tend to be overly optimistic (perhaps in the belief that this makes potential buyers more likely to obtain the study), this is still an impressive growth rate even if one subtracts a few percent.

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Jan 17, 2024: The Jan-Nov investment in China's chemical industry between January and November 2023 was up 13.3% year on year.

Comment MCC: This is a larger increase than for the manufacturing sector as a whole (6.3%), indicating a somewhat surprising optimism regarding the sector.

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Jan 16, 2024: According to an article in the Economic Times India, in solvent and commodity chemicals, Indian companies will continue to face pressure from Chinese chemical companies.

Comment MCC: The article mentions battery chemicals as a bright spot for Indian chemical companies, but adds that in this segment, pressure will also come from Chinese competitors.

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Jan 15, 2024: According to Eurostat, the EU trade in chemicals with China turned into a slight deficit in 2021 and a substantial one in 2022 after continuous surpluses between 2009 and 2020.

Comment MCC: The main reason for the big deficit in 2022 is the strong increase in Chinese exports to the EU (+93%) that was not compensated by a much smaller increase in exports to China (+15%),

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Jan 14, 2024: In the last quarter of 2023, BYD overtook Tesla as the producer of the largest number of electric vehicles

Comment MCC: While Tesla has a strong brand, BYD and other Chinese players have their own advantages, including the lower price, strong government subsidies, and strong supply chains for critical materials such as rare earths. BYD has the additional advantage of having a background in battery manufacturing, which also helps the company reduce overall production costs.

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Jan 13, 2024: A recent paper provides an assessment of recent major chemical accidents in China

Comment MCC: The paper notes a lower occurrence of accidents in summer and an overall decline of accidents in the period from 2017 to 2022.

https://link.springer.com/article/10.1007/s44268-023-00024-0
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Jan 12, 2024: A paper published at the World Economic Forum Annual Meeting states that China's growth forecast has improved

Comment MCC: Key drivers of growth are innovation, green tech, and capital markets. At least the first two have a strong connection with the chemical industry.

https://www.weforum.org/agenda/2024/01/china-future-trends/

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Jan 11, 2024: According to Xinhua, the world's largest ethanol production equipment, with an annual output of 600,000 tonnes, went into trial in Huaibei, Anhui. The plant converts coke oven gas into ethanol.

Comment MCC: The press release further remarks that this"will massively increase the added value of coal and provide a feasible way for the low-carbon development of steel and petrochemical industries."Given that the ethanol is derived from fossil resources rather than from plants (bioethanol), at least the last part of the statement is wrong.

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Jan 10, 2024: Sinopec expects Chinese coal consumption to peak around 2025 at 4.37 billion metric tons while oil consumption is projected to peak around the middle of 2026-2030. China's total carbon emissions from energy activities are expected to peak during the 15th Five-Year Plan period at 10.1 billion metric tons, up from 10.02 billion tons in 2023.

Comment MCC: It seems China is on track to achieve the - rather unambitious - goal of peak emission by 2030. The zero-emission target for 2060 will be much harder to achieve.

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Jan 09, 2024: A team led by Chinese researchers has mapped the chemical composition of the lunar surface with greater precision than before, using samples brought back by China's Chang'e-5 mission.

Comment MCC: Apparently, these samples provide information on the more recent geological past of the moon, a period that previously collected samples did not cover.

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Jan 08, 2024: IMCD acquired the specialty distribution company Guangzhou RBD Chemical, a distributor of lubricant additives.

Comment MCC: This is a fairly small deal in a niche of the chemical distribution segment - the annual sales of RBD are only about 10 million EUR.

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Jan 07, 2024: According to a recent paper, China's five most dangerous industries are coal mining, metal and non-metal mining, construction, and chemical and fireworks manufacturing.

Comment MCC: The paper highlights the dangers in the chemical industry: "Especially in the chemical industry, major accidents occur more frequently. According to statistics, from 2016 to 2021, there were 1050 chemical accidents in China, resulting in 1330 deaths."

https://bmcpublichealth.biomedcentral.com/articles/10.1186/s12889-023-17...

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Jan 06, 2024: According to Statista, China's share of global chemical exports dropped from 9.6% in 2021 to 9.3% in 2022.

Comment MCC: However, given the long lock-downs in China in 2022, this may not be an indication of a broader trend. The long-term trend from 2009 (4.7%) to 2022 still suggests that China's share may increase further.

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Jan 05, 2024: According to the Hellenic Shipping News, some Indian chemical producers are planning to increase production in 2024 to take advantage of the China Plus One strategy adopted by some global chemical buyers, which should boost India's export potential.

Comment MCC: However, currently many Chinese basic chemicals exports are sold at very low prices (Indians talk about dumping) - this will make it hard for Indian producers to compete.

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Jan 04, 2024: China imposed stricter export controls on graphite, a critical EV battery material, since December 1 (Digitimes Asia)

Comment MCC: As a consequence, some Japan-based companies have been diversifying their supply chains and purchasing from other countries to reduce the risk of not being able to buy the material from China

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Jan 03, 2024: An analysis of snowpack collected in Harbin revealed the presence of different pollutants depending on the collection site. Specifically, "coal combustion, industrial emissions, and traffic-related activities lead to the enrichment of heavy metals in the snowpacks of urban and suburban areas, while coal combustion and biomass burning contribute to pollution in rural areas."

Comment MCC: An interesting approach to analyse pollution.

https://www.sciencedirect.com/science/article/abs/pii/S0045653523031569

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Jan 02, 2024: The market share of the top 5 Chinese maleic anhydride producers reached 64% in 2023, up almost 10% from 2022 and double the share in 2013.

Comment MCC: Underlying causes are the shift to larger scale plants, shifts in production technology, and value chain integration.

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Jan 01, 2024: A recent paper analyzes the origin, evolution, and current status of Chemical Industrial Parks in China.

Comment MCC: Perhaps even more important, the paper also analyzes the characteristics and causes of 90 chemical accidents in detail.

https://www.sciencedirect.com/science/article/abs/pii/S0950423023002632