China to limit production rate at all plants in Zibo, Shandong

As reported earlier, Chinese government has implemented strict measures to ensure air quality in the country during this winter. Besides the ban in construction work in the capital city of Beijing and the use of diesel trucks in 28 cities in the Northern area, all factories in Zibo  - a district in Shandong province are required to cut production rate by 50% from 1 December 2017 to 31 January 2018.

There is only one petrochemical complex in Zibo, which is Qilu Petrochemical with nameplate capacity of 70,000 tons/year of PP, 140,000 tons/year of LDPE, 120,000 tons/year of LLDPE and 390,000 tons/year of HDPE.

At the downstream side, the announcement did not specify the exact number of manufacturers affected by the new regulation; however, players reported that a large number are plastic processing companies.

The new regulation might be implemented in other provinces soon, though the impact on the market remains unclear as both supply and demand are affected.