Polyolefins have witnessed some difficult years recently, particularly
in the regions of North America and Europe. Despite this, polyolefins,
accounted for 88 million tonnes globally in 2002, continuing to
influence the growth of plastics. While future projections from
different pundits of polyolefins business, may vary, most of them
agree that polyolefins would attain the level of more than 130 million
tonnes by 2010, providing an average growth of 5% from 2002.
Infact China, the largest consumer of polyolefins, accounting for
almost 14.5 million tonnes in 2002 (more than 16% of global consumption)
will increase its share. This increase is estimated to almost 20%
of global consumption, accounting for almost 25 million tonnes of
consumption by 2010. Polyolefins are expected to grow at 7% in China,
compared to about 4-5% in North America and Europe.
China continues to show positive growth regardless of what happens
in the other parts of the World. Infact two major events; WTO and
the 2008 Olympics in China will stimulate growth of polyolefins
in China. While newer capacities are being developed with the help
of investments from multinational companies , China is expected
to be a big importer of polyolefin until 2010. Infact, by the turn
of the next decade, imports could increase from about 4 million
tonnes to as high as 8-10 million tonnes. This would be despite
the development of almost 4-5 million tonnes capacity in China during
the next decade. Most of these newer capacities are likely to be
set up only around or after 2005.
While Asian coutries like Korea and Singapore may continue to be
a major source of polyolefins in China, the newer capacities likely
to be developed in the Middle Eastern region (Saudi Arbia, Iran,
Iraq, AbuDhabi and Egypt) would play a major role in meeting China's
insatiable demand.
The period 2004-2006 is expected to be very boyant all over the
world. Capacity utilization could reach a very high level leading
to price escalations. However the newer capacities expected to go
on-stream in the second half of this decade would provide price
stability.
2002 has seen a definite shift from PP to HDPE, on account of higher
price due to tightening of Propylene feedstock. Despite this shift,
PP is expected to show higher growth than Polyethylene. Infact,
most of the pundits predict PP to grow at 6-6.5% compared to PEs
at 4-4.5%. Among the PEs, LLDPE is expected to grow at more than
6.5%, while LDPE may lose its share in the LDPE/LLDPE segment to
a level below 40% from the existing 52-53%.
|
Global Demand Estimates (Million Tonnes) |
|
2002 |
2010 |
AAGR |
PE |
55 |
77 |
4.3 |
PP |
33 |
54 |
6.4 |
|
88 |
131 |
5.2 |
|
China Demand Estimates (Million Tonnes) |
|
2002 |
2010 |
AAGR |
PE |
8.5 |
15 |
7.4 |
PP |
6 |
10 |
6.6 |
|
14.5 |
25 |
7.0 |
|