It is a cliché but true statement that China's petrochemical industry has been undergoing a period of momentous change ever since its acquisition of WTO membership. Year 2006, the first year of the 11th Five-Year Plan has also seen many historical moments, such as the start-up of CNOOC/Shell Nanhai petrochemical project and celebration of China's first 1 million-ton ethylene project constructed by Maoming Petrochemical.
The meteorically rising impact of China's petrochemical industry on the global market is fundamentally driven by its fast growing demand and policy decision to increase self-sufficiency, which welcomes a new peak of petrochemical construction. At the same time, these two factors are the most vibrant and volatile.
The feedstock security which is raised by many factors, such as oil price uncertainties and scarcity of crude supply, is one of the biggest problems facing China's petrochemical production. It also leads to the discussions and feasibility studies over the alternative feedstock sources, such as coal-to-olefin. The China's petrochemical demand-supply balance has always been a regional even a global issue. However, the Asian producers remain the key beneficiaries of China's strong growth. The fact that different products are showing different supply-demand trends and the production capacity additions in the Middle East have raised huge market concerns. Therefore generally, China's petrochemical industry development is entering a crucial stage, multinationals and regional majors' strategic planning will fundamentally change the landscape of this market. The development of China's chemical park industry appears to be another highlight. Its promise to promote industry integration and circular economy is being challenged by problems, such as environmental protection. The question of ensuring the healthy development of chemical park industry has become of paramount importance.
The petrochemical industry, as a ‘pillar' industry in China, will remain strictly monitored by the central government, especially its upstream sectors. But the shortfall for feedstock and processing capacity will eventually lead this industry to become a more open and cooperative market, hence investment and trading opportunities for foreign companies can be predicted to remain enormous for many years to come.
Based on this forecast, the China Decision Makers Consultancy is proud to present the elite gathering China Petrochemical Focus 2007 on May.24th & 25th in Shanghai.
