Coronavirus limits China travel to recycling conference

Analysts are expecting the coronavirus to have a bigger impact on the petrochemical industry in China than the SARS epidemic nearly 20 years ago, even as the virus is being felt in other ways around the world, like curtailing a visit from a large Chinese delegation to an upcoming U.S. recycling conference.

Consulting firm Wood Mackenzie said Feb. 13 that "it expects the coronavirus outbreak to have a much bigger impact on China's petrochemicals industry than the SARS [severe acute respiratory syndrome] outbreak in 2003."

"We believe the market should recover from late Q2, mimicking the post-SARS trend of a bounce in demand for consumer goods," said Kelly Cui, Wood Mackenzie principal consultant. "However, given the tighter restrictions on transport movement, delayed recovery in operations and higher rate of contagion compared to SARS, the coronavirus outbreak will have a greater impact on all markets — including petrochemicals."

Coronavirus, now officially named covid-19, will be sharply limiting participation from China at the Plastics Recycling Conference and Trade Show, slated for Feb. 17-20 in Nashville, Tenn.

A delegation of 30-40 people from the China Scrap Plastics Association had to cancel its trip to Nashville for the show and for related company visits to other recyclers, said Stephen Wong, executive president of the Beijing-based CSPA and the CEO of Hong Kong-based Fukutomi Recycling Co. Ltd.

"Visiting is not possible due to travel restrictions," said Wong, who was already in the U.S. when travel restrictions were put in place and will still speak at a CSPA presentation during the conference Feb. 18.

The U.S. government in late January banned foreign nationals who had been in China in the last 14 days from entering the United States, and it required quarantines and limits on U.S. citizens who had.

Global supply chains are continuing to grapple with the business impacts of the virus as many factories in China remain shuttered or operating at reduced capacities.

Nissan temporarily halted production at a plant in Japan Feb. 11 for a few days because of parts shortages from China, following a similar move earlier by Hyundai at South Korean factories.

Wood Mackenzie estimated there would be a small increase in demand for polypropylene fiber within China to make face masks but noted that the virtual lockdown of many Chinese cities will weaken polyolefin demand for commodities like disposable packaging.

"Coupled with a weak plastic products export market, polyolefins demand will be further eroded," Wood Mackenzie said.

As well, the coronavirus prompted the Mobile World Congress, one of the world's largest tech shows, to cancel its upcoming show that had been scheduled to begin Feb. 24 in Spain.

Wenling, China-based plastic tableware maker Fuling Global Inc., which is traded on the Nasdaq stock market, said Feb. 12 that its factories had resumed partial production and added it was donating disposable tableware and medical supplies to hospitals and frontline medical workers combating coronavirus.

Fuling Chairwoman Guilan Jiang said the company learned there was a shortage of tableware for those medical workers and that many had to eat meals in potentially unsanitary conditions.