Japan's ethylene production for the six month period from January to June, 2008 has amounted to 3,570,500 tons, an 8.2% decline from the corresponding period last year. June's ethylene production shrunk 5.9% from the previous year amounting to 572,500 tons, a monthly decline reported for the eighth time in a row. This marks the first decline of Japan's ethylene output in two years and is certainly indicative of the ethylene plants being revamped more often than usual and the nation's gradually slowing economic situation. Apart from ethylene, production of other petrochem products like polypropylene, styrene monomer and vinyl chloride monomer, also shrunk. Of the 17 petrochem products produced in Japan, output of 14 went down in this period.
The July-September period is expected to be decisive, as escalating crude prices have rung a warning bell for the slowing economy. Petrochemicals majors prefer to stand at the sidelines and observe the economic parameters before they decide to reduce production capacities.