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After a lackluster performance in the financial
year 2002-2003 and despite a modest economic growth, plastics have
recovered well in 2003-2004.
PP, which was one of the fastest
growing polymers in the mid nineties, seems to have lost its sheen
in the last 1-2 years. In 2002, PP lost some business to HDPE due
to higher prices, but has currently arrested the shift. Yet the
consumption of PP is expected to be only around 1150KT. LDPE seems to be having a negative growth or reached
maturity. Of the Polyethylenes, only LLDPE seems to grow well. In fact,
LLDPE has achieved a share of more than 60-65% of the total LD/LLDPE
consumption. Only PVC
capacity of 788KT seems to be lower than the expected consumption
of about 850 KT in 2003. It could go up to 875KT if PVC pipes pick
up in the first quarter of 2004.
PS is also
being exported due to overcapacity.
The industry expects the following consumption figures for commodity
plastics in 2003-2004
| Polymer |
Consumption in KT |
| PE
|
1550 |
| PP
|
1150 |
| PVC
|
875 |
| PS
|
190 |
| ABS/SAN
|
65 |
| PET
Bottle |
70 |
| PET
Film |
75
|
| Total
|
3975 |
Polymers are expected to clock at least 9-10% growth, which is
not really impressive compared to the GDP growth of 8.1%. Have polymer volumes reached a level
where 15% growth seems difficult to achieve? Or have the polymer
markets matured? In fact, projections of 7 million tons made by
the Petrochemical working committee for 2007 seem difficult to achieve
as commodity polymers have barely reached a level of about 4.0 million
tons in 2003-2004.
It is expected that 2004-2005 would achieve a growth of around 10%
although the projection of GDP is about 7%. Gone are the days when
14-15% overall growth was observed for plastics. India now should
be happy to maintain 10% growth. At this level of growth India would
attain the consumption of commodity plastics at just around 6 million
tons in 2007-2008 compared to the projections of 7 million tons.
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