DEEP DIVE: China’s Overcapacity Issues Affect Global Pricing on Chemicals, Industrial Materials

For the last few years, China’s GDP growth and industrial activity has been moving at a slower pace than chemical producers predicted- and relied on. Increasing unemployment, slowed consumer spending, and a prolonged property crisis have all contributed to China’s economy experiencing a slower-than anticipated recovery, and the global chemical industry is feeling the impacts.

“The situation in China certainly has an impact on the overall pricing situation in the world,” said Markus Kamieth, CEO of BASF in the company’s Q2 earnings call. “There’s no question about that because China is by far the largest chemical market in most of the chemical categories that we are looking at here.”