(Bloomberg) — Once touted as a key driver of global oil profits, the plastics industry is facing years of low margins due to the influx of production from giant plants in China.
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According to industry consultant ICIS, more than 20 petrochemical projects are set to be completed in China this year. These projects will produce raw materials used in the production of plastic packaging, clothing, detergents, and more.
Although some of the output will be consumed domestically in China, oversupply is expected due to a slower-than-expected rebound in China’s economy and excessive investment. This oversupply will lead to shrinking returns for petrochemical production, such as ethylene and propylene. In June, margins were already 40% below 2019 levels.
China has been aggressively expanding its plastics industry to meet domestic demand, which has been growing faster than in other regions…
2023-07-08 19:00:00
Source from finance.yahoo.com
