Will shale gas decimate China's toy makers? (Manufacturing moving back to the US?):

Yahoo! Finance UK / Reuters ^ | March 28, 2013 | Clyde Russell

[2ndDivisionVet]

Such is the impact of the shale gas revolution in the United States that it's quite possible that babies born today will no longer play with plastic dolls and cars made in China.

It's almost become a fait accompli that China is the world's factory, but the early warning signs that this may be changing are starting to show.

The advent of cheap natural gas in the U.S. is threatening to displace expensive naphtha in the production of petrochemicals, the key building blocks for plastics, synthetic fibres and solvents and cleaners.

While the shale gas boom is certainly no longer a secret, up to now its main impact has been in displacing coal in power generation in the U.S., and making inroads as both a heating and transport fuel.

While the U.S. is planning to export some of its shale bounty as liquefied natural gas, in effect it is already exporting more energy in the form of coal, which has helped keep Asian prices soft even in the face of record Chinese and Indian imports.

The same sort of dynamic is likely to start hitting the Asian petrochemical sector in the next few years, as U.S. output ramps up on the back of cheap natural gas and producers from India to China struggle to compete given their reliance on oil-derived naphtha.

Sinopec Corp., Asia's largest refiner, admitted that it has been caught off guard by the advent of U.S. competitors using cheaper feedstock.

"This is something we did not expect before," Wang Tianpu, Sinopec's vice chairman and president, said March 25 at a briefing to announce the company's results, which saw a 12.8 percent slump in profits in 2012 from the year earlier.

Sinopec will strive to lower its petrochemical costs by using less naphtha and optimising the product mix......

[Brad from Tennessee]

Since China is still a totalitarian society all the resources of the state can be focused on supporting the commercial sector. You see this in currency manipulation, counterfeiting western brand-name products, and industrial espionage. In China state employees work full time engaging in practices that would put an American entreprenuer in prison. Stalin said the Western capitalists would hang from the very rope they had sold to the communists. China will steal the rope.

[mindburglar]

3d printers and robots already have them on the ropes.

Now we just need 3d robots from outer space to finish them.

[VeniVidiVici]

Don’t worry. I’m sure the Democrats will soon pass legislation that will once again make it more profitable to keep production in China.

[Brad from Tennessee]

That’s a good point. The U.S. has always had the edge in technology. And automation can trump cheap labor.

[meyer]

And automation can trump cheap labor.

But, can it trump government intrusion, taxation, and regulation?

[Conspiracy Guy]

excellent point

[SeminoleCounty]

Good news....but guaranteed that the Free Trade Communists who are on the payroll of the ChiComs will find a way to screw America and Americans

One thing I have learned in my short....Ok maybe not so short...lifetime ...is that the ones who are the biggest threat to the Free Market are Free Traders

[1010RD]

“This is something we did not expect before,”

How could this be unexpected? Didn’t anyone formulate a 5 year plan?

[1010RD]

You sound like a liberal: the biggest threat to the Free Market are Free Traders.

Can you at least define your terms?

[spokeshave]

...this is not the expectation that you are seeking....

[1010RD]

If I had an original Star Wars blaster for every time I heard that line...

[PA Engineer]

3d printers and robots already have them on the ropes.

Agreed. I would add the impending electrolytic titanium extraction process to the list. Titanium powder would radically expand 3d printer development.