Facing the Financial Crisis: Petrochemical Logistics Opportunities Outweigh Challenges

Petrochemical products serve as essential raw materials for both industrial production and consumer goods. In the wake of the global financial crisis, how have trends in petrochemical logistics evolved? What opportunities and challenges lie ahead? And what improvements are needed in transportation and service management? Industry experts emphasize the importance of integrated development in China’s petrochemical logistics sector, the need to build a high-quality logistics workforce, and the necessity of addressing policy-related issues within the industry. Currently, although China's overall economic situation remains strong, the petrochemical logistics sector faces both challenges and opportunities due to the impact of the financial crisis on the industry and the economic slowdown in Western countries. At the Fourth China Liquid Chemicals Logistics Summit, government officials, corporate leaders, and experts analyzed the current status, characteristics, and future trends of domestic petrochemical logistics. With the introduction of major policies to stimulate domestic demand, many companies in the petrochemical logistics sector have also implemented similar measures, creating favorable conditions for growth. As demand for petrochemical products gradually recovers, more companies are turning to professional logistics providers for transportation. Some logistics firms have successfully attracted petrochemical businesses through their services and reliability, presenting more opportunities than challenges. First, China’s petrochemical industry, which is a cornerstone of the national economy, continues to grow at a high rate. In 2007, its output value increased faster than that of the overall GDP. Second, sustained high oil prices have spurred the development of new coal-based chemical industries, such as coal-to-oil and coal-to-olefin, leading to significant production capacities in liquid chemicals and fuels. This has created a demand for new transport solutions and logistics services. Third, the establishment of chemical parks, coastal freight terminals, regional pipeline networks, and expressway systems has increased the need for modern logistics support. Fourth, multinational petrochemical companies are seeking supply chain partners, with over 2,000 foreign firms operating in China, most of whom outsource logistics. Fifth, some large domestic petrochemical enterprises, under pressure from rising costs, are also considering outsourcing logistics. Data shows that global logistics service providers have grown at an average annual rate of 20%, with the U.S. and China leading in logistics output growth. Since last year, China’s petrochemical logistics sector has entered a phase of rapid development. Global logistics has moved into the supply chain era. The integration of logistics and manufacturing, along with collaborative innovation, is a key trend in today’s global economy. Multinational companies are expanding where their business goes, and logistics providers follow accordingly. A shared concern among the petrochemical industry and society is how to efficiently and safely manage the entire supply chain—production, distribution, and delivery—while maximizing profits at lower costs. Wang Xiaopeng, General Manager of Shanghai Sinotrans Chemical International Logistics Co., Ltd., noted that strategic partnerships between multinational companies and large integrated logistics firms are becoming the norm in international petrochemical logistics. These companies increasingly prioritize supply chain integration, service outsourcing, and focusing on core business areas. Logistics providers must align with where the business goes. Recent research by McKinsey revealed that foreign companies prefer large, reputable logistics providers with strong assets and qualifications. Domestic enterprises, often smaller, tend to adopt a “small and complete” model. Some companies have called for a mutually beneficial relationship between manufacturing and logistics, which has gained industry support. Establishing a symbiotic relationship between logistics and manufacturing is also crucial for safe storage and transportation. With over 100,000 petrochemical companies producing more than 50,000 products, the scale and complexity of hazardous chemical transportation are immense. Ensuring safe transport is a top priority, with stricter international regulations on hazardous material management. Wang emphasized that multinational corporations are highly concerned with HSE (Health, Safety, and Environment) and risk prevention. A single accident can damage a company’s reputation. Therefore, the logistics responsibilities previously handled by multiple providers are now concentrated on one or two reliable supply chain partners. Currently, only 30% of domestic vehicles use specialized equipment for transporting hazardous chemicals. The development of a strong logistics industry is urgently needed. Experts suggest building first-rate logistics companies and deploying advanced equipment as a top priority for healthy growth. Wang also pointed out that many transporters engage in illegal activities to gain profits, but more importantly, there is a lack of qualified teams for hazardous chemical transport in certain regions. As multinational companies like Bayer and BASF expand their production in China, standard warehouses and vehicles will no longer suffice for handling chemicals like TDI and MDI. Zhao Guoqiang, General Manager of British Baoke Logistics (Beijing) Co., Ltd., mentioned that ten years ago, they started as agents and now operate in four main areas, targeting large petrochemical companies and multinationals. IBP sees great potential in Sinopec’s logistics market and plans to transfer equipment manufacturing to China to provide tank containers for domestic and Asia-Pacific logistics companies. Tank containers offer safe, efficient, and win-win solutions in multimodal transport. They can carry 45% more liquid cargo than standard drums and enable door-to-door delivery in one step. Experts also highlighted the need to address policy and reform issues, including outdated supply chain management and insufficient logistics facilities. The State Council’s recent policy on accelerating service industry development is a positive move for petrochemical logistics. Wang Ming, Deputy Chairman of the National Development and Reform Commission’s Institute of Integrated Transport, noted that while the industry has a bright future, it still faces institutional and market challenges, such as irrational policies, security risks, and weak service capabilities. To overcome bottlenecks in tank container transport, experts recommend aligning railway dangerous goods regulations with international standards to expand railway container operations and leverage the advantages of railways in long-distance, low-cost transport. Gao Fuxing, General Manager of Changjiang International Port Co., Ltd., proposed establishing a cargo control system to manage risks, including risk identification, analysis, planning, and internal controls. To solve supply chain and logistics infrastructure gaps, experts suggest integrating social logistics resources, encouraging investment from central and local governments, foreign capital, and private enterprises, and building high-quality logistics service providers. They also recommended setting up regional logistics information platforms in key areas like the Yangtze River Delta and Pearl River Delta, promoting centralized procurement, warehousing, and distribution models, and developing logistics talent through collaboration with universities and industry associations.

Other Profile Extrusion Line PVC Decoration Sheet

YF series PVC imitation Marble (Foam) Profile Extrusion Line, consists of single screw extruder and the special co-extruder,with the cooling water tank, hot stamping machine system, hual-off unit, and stacker. This line with imported ABB AC inverter control, imported RKC temperature meter etc. and features of good plasticization, high output capacity, and stable performance etc. By adjust the embossing wheel the machine can work on various of different profiles. Working together with the main extruder and other extrusion down steam equipments, this line is popular ad the latest developed producing line.

UV Imitation Marble Board:

a. Board surface coat imitation marble film, or laminate imitation marble and through curing treatment, good anti scratch, and scratch resistance.

b. Board with variety of color, it is convenient to construct.

c. Instead of marble etc. natural stone in the interior.

Pvc Sheet Extrusion Line,Pp Sheet Extrusion Line,Pc Sheet Production Line,Sheet Extruding Production Line

KonRun Intelligent Machinery(Ningbo) Co., Ltd. , https://www.konrunmachine.com