Sourcing chemicals in Asia after a week of Coaching Asia means knowing China’s calendar and the structures behind a producer

Sourcing chemicals in Asia after a week of Coaching Asia means knowing China’s calendar and the structures behind a producer.

I am Siggi. I know the chemistry in Asia.

Every morning, I use my Coaching Asia to look at what is moving in Asia and the Middle East and what it could mean for sourcing in Europe. This week produced several posts. Here are the topics at a glance.

The calendar is the most urgent. China has two holiday blocks, the Mid-Autumn Festival from 25 to 27 September and National Day from 1 to 7 October. A large part of the workforce takes the three working days in between off, so they turn into one block until 7 October. In my experience, an order that goes out next week will hardly be shipped before mid-October.

Every month China’s statistics bureau publishes a number that hardly anyone in Europe reads. The product sales rate shows what share of output was sold in the same month. In August it stood at 96.8 percent. The same releases contain figures on chemicals: factory gate prices for chemicals were 9.1 percent above the previous year in August and 0.1 percent below July. From January to July the Chinese chemical sector earned 56.6 percent more than a year earlier. Anyone assuming that Chinese producers are under pressure should know this figure.

In Korea, the first enquiry rarely fails on price. It lands with the wrong company. Besides the producing company there is often the group’s trading company, an independent exporter, a European distributor with an exclusive agreement or a commercial agent. Once the European representation has been assigned, the producer forwards the enquiry, quite often to a competitor of the person asking. Anyone who knows that beforehand writes the first email differently.

During my market analysis in China I came across producers that barely appear in European market overviews. Jiangsu Huafeng Ruixun is pursuing a BioPTMEG project based on furfural from corn cobs. Dongying Liancheng Chemical, part of Huatai Group, has built a plant for 100,000 tonnes of epichlorohydrin per year based on glycerol. For Fujian Baihong, the project documents show 140,000 tonnes of propylene carbonate per year, of which 120,000 tonnes are intended for captive use.

On a personal note. In June, the Asia Chemical Network brought together more than 120 people from the chemical industry in Hamburg. Now I would like to build an Asia Chemical Network Advisory & Development Board with people from our industry who decide together with me how the network develops, including events in Asia. If you would like to be part of it, feel free to send me a direct message.

Coaching Asia makes me question myself every day and motivates me to engage with this subject afresh every morning.

That's the chemistry.
Siggi