On February 26, 2019

Chinese Chemical Growth Will Reshape The Supply Chain

Europe has been a dominant player in the chemical industry but has gradually lost it’s top spot to Asia, where Chinese chemical growth is significant. The European Chemical Industry Council (CEFIC) says in their 2018 facts & figures of the European chemical industry report that worldwide competition has changed dramatically over the last ten years with China now firmly holding the top spot once held by Europe.

Below our some important findings reported by CEFIC about both chemical production and sales developments.

Chemical Sales

China continues to dominate the world ranking in Chemical Sales. China sales levels are higher than the other nine countries in the top 10 combined – as much as the NAFTA and EU markets put together. A large number of countries in the top 10 are from Asia.

In 2017, the 30 largest chemical-producing countries had a combined turnover of €3,133 billion, together accounting for 90.2% of global chemical sales. Twelve of the top 30 biggest producers are Asian, generating chemical sales of €1,945 billion – 56.0% of the world market.

The world landscape of the chemical industry is changing rapidly. China is planning an ambitious industrial policy strategy to take its chemical industry to the next stage of development. This strategy is outlined in the “13th Five-Year Plan” for the Chinese petroleum and chemical industry and fits with the long-term vision of the Made in China 2025 strategy. China is looking to move from “following the lead” to “taking the lead” and from a “big country” to a “great power” of the petroleum and chemical industry, leading on technology innovation and trade and prevailing in international markets.

 

Chemical Production

During the 11-year period from 2007 to 2017, the Western chemical industry had a negative weak growth rate. Production in China swelled from 2007 to 2017, attaining 10.7% average annual growth. China is far and away outpacing other Asian emerging economies such as South Korea (3.7%) and India (2.3%).

Long-term analysis shows that overall growth of chemicals demand and production as well as faster growth in emerging regions is a trend that is expected to continue in the future. World chemical sales are expected to reach the level of €6.3 trillion in 2030.

With 44% of world market share, China will continue to hold the top ranking in sales, a position once firmly held by Europe.

Although competition in China’s chemicals market is currently intensifying and demand growth is weaker than in the past, China still offers a huge and attractive market, both for chemical suppliers and their customer industries.

Read CEFIC’s report here to get more insights in the chemical industry.

Will Chinese chemical growth impact the supply chain?

China is no longer the underdeveloped manufacturing country it once was and is today also more focused on building up its logistics industry while it takes over the supply chain.

In trading we have seen companies such as Sinopec increase market share and get involved in controlling the supply chain.  This involves chartering tankers, taking up tank storage capacity and arrange distribution in tank containers, for example.  This shift requires different skill sets and also comes with increased risk.

In the shipping and logistics sector Sinochem has gone internationally as a parcel tanker operator. Today the chemical logistics business of the Sinochem Group is involved in tank containers, freight forwarding and tank terminals, with total assets reaching nearly 7 billion yuen.

While Sinopec and Sinochem are large players, smaller companies are following in their footsteps learning from their big brothers’ experiences. Many companies are still in their primary stage exploring international operations, especially worried about safety and regulatory requirements.

We provide consultancy services covering the liquid bulk and chemical supply chain.  Learn more about our services by following this link.

 

Photo Credit: Rudigerstal

  • By Rudi Stalmans  0 Comments   
  • Parcel Tankers, Tank Terminals

    0 Comments

    Subscribe Now.
    2015 (C) All rights reserved.
    GET NEWS AND UPDATES
    Independent Advisory
    SPECIALISED IN BULK LIQUIDS
    *you can always unsubscribe
    現在訂閱
    2015 (C) All rights reserved.
    獲取ener8的最新消息
    Independent Advisory
    SPECIALISED IN BULK LIQUIDS
    *您可以隨時取消訂閱
    EMERGENCY RESPONSE FOR THE BULK LIQUID LOGISTICS & TRANSPORT SECTOR
    Special Brochure issued by THE NCEC
    By submitting this form you agree to receive emails from ener8 limited.
    Please make sure to provide your full name, company name, telephone number and business email address.
    CONTACT US
    Please make sure to provide your full name, company name and business email address to receive our reply.
    Thank you. We will get back to you shortly.
    *By submitting this form you agree to receive emails from ener8 limited.
    Subscribe to our Newsletter
    *You can always unsubscribe.
    聯繫我們
    請確保提供您的全名,公司名稱和企業電子郵件地址。
    謝謝。我們會盡快給您回复。
    *通過提交此表格,您同意接收ener8的電子郵件。
    訂閱我們的新聞
    *您可以隨時取消訂閱
    I' M INTERESTED IN THIS COURSE
    PLEASE COMPLETE THE BELOW DETAILS
    *when you submit your data, you agree to receive emails from ener8 limited
    tick if you allow us to send email to you
    By ticking the below box and clicking the download button, you give ener8 permission to use the information provided on this form to be in touch with you and to send updates and marketing.
    I accept
    You can change your mind at any time by clicking the unsubscribe link or by contacting us at info@ener8.com. We will treat your information with respect in accordance with our terms and privacy policy.
    By ticking the below box and clicking the download button, you give ener8 permission to use the information provided on this form to be in touch with you and to send updates and marketing.
    I accept
    You can change your mind at any time by clicking the unsubscribe link or by contacting us at info@ener8.com. We will treat your information with respect in accordance with our terms and privacy policy.
    Thank You. Enjoy your Download!
    By ticking the below box and clicking the download button, you give ener8 permission to use the information provided on this form to be in touch with you and to send updates and marketing.
    I accept
    You can change your mind at any time by clicking the unsubscribe link or by contacting us at info@ener8.com. We will treat your information with respect in accordance with our terms and privacy policy.
    By ticking the below box and clicking the download button, you give ener8 permission to use the information provided on this form to be in touch with you and to send updates and marketing.
    I accept
    You can change your mind at any time by clicking the unsubscribe link or by contacting us at info@ener8.com. We will treat your information with respect in accordance with our terms and privacy policy.
    By ticking the below box and clicking the download button, you give ener8 permission to use the information provided on this form to be in touch with you and to send updates and marketing.
    I accept
    You can change your mind at any time by clicking the unsubscribe link or by contacting us at info@ener8.com. We will treat your information with respect in accordance with our terms and privacy policy.
    By ticking the below box and clicking the download button, you give ener8 permission to use the information provided on this form to be in touch with you and to send updates and marketing.
    I accept
    You can change your mind at any time by clicking the unsubscribe link or by contacting us at info@ener8.com. We will treat your information with respect in accordance with our terms and privacy policy.
    By ticking the below box and clicking the download button, you give ener8 permission to use the information provided on this form to be in touch with you and to send updates and marketing.
    I accept
    You can change your mind at any time by clicking the unsubscribe link or by contacting us at info@ener8.com. We will treat your information with respect in accordance with our terms and privacy policy.
    By ticking the below box and clicking the download button, you give ener8 permission to use the information provided on this form to be in touch with you and to send updates and marketing.
    I accept
    You can change your mind at any time by clicking the unsubscribe link or by contacting us at info@ener8.com. We will treat your information with respect in accordance with our terms and privacy policy.
    CONTACT US
    Please make sure to provide your full name, company name and business email address to receive our reply.
    Thank you. We will get back to you shortly.
    *By submitting this form you agree to receive emails from ener8 limited.