Japan Chemical Trading Blog

The latest chemical trading industry insights from Japan, Asia and the world, reported by the President of Daishin Corporation, Masa Oguchi.

Nickel Turns to Oversupply in 2014

According to a Japan Metal Bulletin article on October 17, Sumitomo Metal Mining announced that expected demand and supply of nickel will be “15,000 tons of oversupply in 2014 and 32,000 tons of undersupply in 2015”.

Nickel is a metal used for stainless steel, plating and batteries. Russia, Canada, Indonesia, and the Philippines are the main producing countries.
Immediately after the Indonesian government put a ban on the export of nickel ore in January, with the purpose of promoting development in domestic smelting and processing industries, undersupply was expected for 2014.
However, the alternative supply from the Philippines was more than expected and, as a result, there has been an oversupply in 2014.

In 2015, while there will be a growth in demand, stock in China is expected to become scarce, leading to a lack of supply.
If this is the case, the current decreasing trend of the nickel price may reverse at some point of time.

Nickel Turns to Oversupply in 2014

According to a Japan Metal Bulletin article on October 17, Sumitomo Metal Mining announced that expected demand and supply of nickel will be “15,000 tons of oversupply in 2014 and 32,000 tons of undersupply in 2015”.

Nickel is a metal used for stainless steel, plating and batteries. Russia, Canada, Indonesia, and the Philippines are the main producing countries.
Immediately after the Indonesian government put a ban on the export of nickel ore in January, with the purpose of promoting development in domestic smelting and processing industries, undersupply was expected for 2014.
However, the alternative supply from the Philippines was more than expected and, as a result, there has been an oversupply in 2014.

In 2015, while there will be a growth in demand, stock in China is expected to become scarce, leading to a lack of supply.
If this is the case, the current decreasing trend of the nickel price may reverse at some point of time.

GDP Gap and Business Confidence in Japan

It was reported in this weblog on May 23 that the GDP gap for the Q1 2014 had dropped to -0.3%, leading to a reduction in the negative gap.
However, on August 22, the Cabinet Office of Japan announced that the negative gap had widened again, to 2.2% for the Q2 2014. There has been a backlash against the last-minute demand before the consumption tax increase.

The announcement made by the Bank of Japan on October 8 also showed a similar trend.
The Bank of Japan expects that the GDP gap will further widen in Q4 2014. The economies of Asian countries, including Japan, have been experiencing obvious declines from around July and August, and none of our customers in Japan seems to be enjoying a boom.
It is hard to imagine that demand will increase in the 3 months from now.

GDP Gap and Business Confidence in Japan

It was reported in this weblog on May 23 that the GDP gap for the Q1 2014 had dropped to -0.3%, leading to a reduction in the negative gap.
However, on August 22, the Cabinet Office of Japan announced that the negative gap had widened again, to 2.2% for the Q2 2014. There has been a backlash against the last-minute demand before the consumption tax increase.

The announcement made by the Bank of Japan on October 8 also showed a similar trend.
The Bank of Japan expects that the GDP gap will further widen in Q4 2014. The economies of Asian countries, including Japan, have been experiencing obvious declines from around July and August, and none of our customers in Japan seems to be enjoying a boom.
It is hard to imagine that demand will increase in the 3 months from now.

A Japanese Student Who Wants to Join the Islamic State

Sources recently revealed that a male student (26 years old) at Hokkaido University was planning to travel to Syria with the purpose of joining the Islamic State as a combatant and that the Public Safety Bureau of the Tokyo Metropolitan Police Department had searched his house on suspicion of preparing terrorist-related activities.
It appeared that he had already purchased an air ticket to a neighboring country of Syria.

I cannot imagine how someone who is living in present-day Japan would want to fight as a combatant in the Islamic State.
It is also strange that a bookstore in the Tokyo Metropolitan area was advertising a job opening in Syria.

Since the said person is reportedly telling a journalist he has no interest in Islam or in Syria, it may be just that he happened to find the place while searching for an outlet for his frustration in life.
It is surprising to know that many young people from around the world are heading to the Islamic State.
I suppose this shows how the world is loaded with contradictions.
I hope that by the day I die there will be less contradictions in this world than there were on the day I was born.

A Japanese Student Who Wants to Join the Islamic State

Sources recently revealed that a male student (26 years old) at Hokkaido University was planning to travel to Syria with the purpose of joining the Islamic State as a combatant and that the Public Safety Bureau of the Tokyo Metropolitan Police Department had searched his house on suspicion of preparing terrorist-related activities.
It appeared that he had already purchased an air ticket to a neighboring country of Syria.

I cannot imagine how someone who is living in present-day Japan would want to fight as a combatant in the Islamic State.
It is also strange that a bookstore in the Tokyo Metropolitan area was advertising a job opening in Syria.

Since the said person is reportedly telling a journalist he has no interest in Islam or in Syria, it may be just that he happened to find the place while searching for an outlet for his frustration in life.
It is surprising to know that many young people from around the world are heading to the Islamic State.
I suppose this shows how the world is loaded with contradictions.
I hope that by the day I die there will be less contradictions in this world than there were on the day I was born.

Price of Caprolactam Dropped

On October 7, the Nikkei Newspaper reported that the “contract price offered by Ube Industries Ltd., a major caprolactam manufacturer to consumers in Asia during September was USD 2,245 per ton, down by USD 75 (3%) per ton from the previous month”.

Caprolactam is used as a raw material for nylon.
However, many manufacturers in China are currently increasing their production volume, making it very difficult for other companies to earn a margin.
The price of benzene, one of the raw materials of caprolactam, increased in June to August, and sharply fell in September.
In response to this trend, the price of caprolacatam is liable to drop.
In addition to this, due to the deteriorating economic conditions in Asia, the demand for caprolactam has also fallen into a sluggish pace.

Price of Caprolactam Dropped

On October 7, the Nikkei Newspaper reported that the “contract price offered by Ube Industries Ltd., a major caprolactam manufacturer to consumers in Asia during September was USD 2,245 per ton, down by USD 75 (3%) per ton from the previous month”.

Caprolactam is used as a raw material for nylon.
However, many manufacturers in China are currently increasing their production volume, making it very difficult for other companies to earn a margin.
The price of benzene, one of the raw materials of caprolactam, increased in June to August, and sharply fell in September.
In response to this trend, the price of caprolacatam is liable to drop.
In addition to this, due to the deteriorating economic conditions in Asia, the demand for caprolactam has also fallen into a sluggish pace.

Nickel Price Fall

The nickel price is falling.
The bullion price at the London Metal Exchange (LME), that temporarily increased from about USD 14,000 per ton to more than USD 20,000 in February due to the Indonesian ore supply suspension, has been in a downward trend for the last one month.
The price has fallen from the high price of USD 19,740 per ton in early September to USD 16,300, showing a 17% price decrease in one month.

A vast amount of ore from the Philippines has been supplied to China, Japan and other countries as a substitute of Indonesian ore, and it seems that it is cooling down the market sentiment.
Copper metal prices have also fallen in September.
Just as petrochemicals, a decline trend in the international market of non-ferrous metals has become apparent.

Nickel Price Fall

The nickel price is falling.
The bullion price at the London Metal Exchange (LME), that temporarily increased from about USD 14,000 per ton to more than USD 20,000 in February due to the Indonesian ore supply suspension, has been in a downward trend for the last one month.
The price has fallen from the high price of USD 19,740 per ton in early September to USD 16,300, showing a 17% price decrease in one month.

A vast amount of ore from the Philippines has been supplied to China, Japan and other countries as a substitute of Indonesian ore, and it seems that it is cooling down the market sentiment.
Copper metal prices have also fallen in September.
Just as petrochemicals, a decline trend in the international market of non-ferrous metals has become apparent.

PVC Price Decreased

According to the Nikkei Newspaper on October 1, “PVC resin price dropped in Asia, going down to a spot price of USD 1000-1020 per ton, the lowest price in the last 5 months”.
PVC is an inexpensive widely applied plastic made from chlorine, produced from salt and ethylene obtained from naphtha.

Generally, the demand for petrochemical products is rather sluggish these days, PVC doesn’t make an exception. Inquiries for the product are particularly weak in China and India.
Facing the naphtha price drop and a poor demand, reversal of the market situation can be hardly expected for the time being.

PVC Price Decreased

According to the Nikkei Newspaper on October 1, “PVC resin price dropped in Asia, going down to a spot price of USD 1000-1020 per ton, the lowest price in the last 5 months”.
PVC is an inexpensive widely applied plastic made from chlorine, produced from salt and ethylene obtained from naphtha.

Generally, the demand for petrochemical products is rather sluggish these days, PVC doesn’t make an exception. Inquiries for the product are particularly weak in China and India.
Facing the naphtha price drop and a poor demand, reversal of the market situation can be hardly expected for the time being.