Episode 1414: Think Tank: Signs of more protectionist approach as global chemicals slide towards a 2028 trough, Europe and Asia fight for survival
Update: 2025-12-12
Description
Remarks by French president Emmanuel Macron suggest a tougher approach to protecting Europe as global chemicals move towards a 2028 bottom of cycle. - Ethylene, propylene capacity additions to accelerate, peak in 2027 - 2028 bottom of the cycle, project delays could push this out to 2029- 2000-2028 almost 75% of global capacity additions for key building blocks have been in China - Final investment decision (FID)-to-on spec production can be only 2.5 years in China, so risk of further projects adding to the problem - China additions may slow from 2030 due to peak carbon goals- Fight for survival for producers in Europe and Asia- To balance markets around 24m tonnes of ethylene closures required – equivalent to demand of Europe, Former USSR and Africa - 26m tonnes of propylene closures required - equivalent to capacity of Europe, Former USSR and Africa- Olefins demand at 30-year low in Europe, to 1990s levels, and will not revive- Signs of a more protectionist approach by Europe to save industrial base- Producers in China are also suffering from overcapacity, losing money- China exported more chemicals than the US or Middle East in Q2 2025- Trinseo closure, INEOS Quattro ratings downgrade spell more bad news
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