China’s Petchem Firms Face Deeper Losses as Tax Perks Fade: GL

China’s rollback of preferential tax policies for petrochemicals firms could deepen losses in the sector, GL Consulting said at a briefing on Thursday.

• NOTE: Beijing to cut export tax rebates on 200 products including petchems from April 1
• Levy on naptha use to raise feedstock costs by 300 yuan/ton
  • Rebate payment period could be extended to 6-12 months, which would add pressure to cash flow and could push some smaller refiners out of business
• Measures will squeeze hydrocracking margins, but support coal-based chemicals
• PDH plants avg loss last year was 663 yuan/ton; for polyethylene plants it was 189 yuan/ton
• Coal-to-olefin ...