emerging trends in asian polymer markets - platts.com · emerging trends in asian polymer markets...
TRANSCRIPT
© 2013 Platts, McGraw Hill Financial. All rights reserved.
Emerging trends in Asian polymer markets
Prema Viswanathan, Associate Editorial Director-Petrochemicals,
Olefins Asia 2014, Shanghai, 06-07 March, 2014
2
Agenda
• China polymer imports – 2012-2013
• Polyolefins demand, supply, import trends
• Olefins imports to China
• Polyolefins margins
• The Middle East factor
• The Shale Gas factor
• Price trends and margins for polyolefins
3
China polymer imports
3
0
2000000
4000000
6000000
8000000
10000000
12000000
14000000
16000000
18000000
LDPE LLDPE HDPE PP Homo PP Copol GPPS HIPS ABS PVC PET Total
2012 2013MT/year
Source: China Customs
4
China’s PE/PP balance
0
5
10
15
20
25
2013 2014 2015 2016 2017
Capacity
Demand
0
5
10
15
20
25
2013 2014 2015 2016 2017
Capacity
Demand
Figures in million mt/year
PE PP
Source:Platts
5
China PE, PP imports
5
0
1000000
2000000
3000000
4000000
5000000
6000000
7000000
8000000
9000000
2012 2013
PE PP
Source: China Customs
6
China olefins imports
6
0
500000
1000000
1500000
2000000
2500000
3000000
1 2 3 4 5 6 7 8 9
YEAR Ethyelene Propylene
MT/year (2005-2013)
Source: China Customs
7
Middle East PE capacity-demand chart
0
5
10
15
20
25
30
35
2013 2014 2015 2016 2017 2018
Capacity
Output
Demand
Source: Platts
Note: Figures in million mt/year
8
Shale Gas: A Global Phenomenon
8
9
Ethylene: Producers are “all-in”
9
Source: Company announcements, Platts
IF built, proposed greenfield projects in the US could add as much as 8.55-9.15 million mt/yr of ethylene capacity by 2017
Company Location ,000 mt/yr ETA
ExxonMobil Chemical Texas 1,500 2016
Formosa Plastics CUSA Texas 800 2016
Chevron Phillips Chemical Texas 1,500 2017
Dow Chemical Texas 1,500 2017
Sasol Louisiana 1,500 2017
Occidental/Mexichem Texas 550 2017
Shell Chemical Pennsylvania 1,000-1,500 2017
Aither Chemical/RMG W. Virginia 200-300 2017
Appalachian Resins W. Virginia 250 2017
10
Brownfield projects: The Ones to Watch
10
Source: Company announcements, Platts
Company Location +,000 mt/yr ETA
BASF-Total Texas 60 2012
Dow Chemical (restart) Louisiana 400 2012
Westlake Chemical Louisiana 110 2013
Williams Louisiana 230 2013
Ineos Texas 120 2013
Westlake Chemical Kentucky 80 2014
BASF-Total Texas 100 2014
Westlake Chemical Louisiana 110 2015
LyondellBasell Texas (3) 830 2014-16
Dow Chemical TX/LA (2) 400 2014-16
11
Ethylene nearing 6 year high (CFR China)
11
$1,695/mt
$385/mt
$1,345/mt
$850/mt
$1,392/mt
$1,005/mt
$1,403/mt
$885/mt
$1,162/mt
$1,510/mt
Nearing 6
year high
12 Source: Platts
Margins: HDPE
13
Propylene Prices 2010-2013 (CFR China)
13
14 Source: Platts
Margins: PP
15 15
• PE expected to rebound in March as
Chinese producers cut rates
• Chinese producers had 1.1m-1.2m mt of
PE and PP after Lunar New year holidays,
compared with 0.8m mt around this time
last year
• End users and distributors have very low
inventory and will have to restock very
soon
Outlook: PE
16 16
• Regional turnarounds in Q2 to tighten
supply
• Weak demand as margins mostly negative
because of weak SM and MEG demand
and high inventory
• Slight weakening of C2 expected but will
be capped by tight supply
• High Asian prices causing cargoes to
move from Europe to Asia – 18-19kt fixed
for Q1
Outlook: Ethylene
17 17
• Market direction in Asia bearish
• Chinese buyers showing little buying interest
• Inventory stockpile among producers
• Slow buying after Lunar New Year
• Domestic China prices weakening and this has squeezed
import prices
• Weak economic outlook for China
• Tightening credit also slowing buying activity
Outlook: PP
18 18
Outlook: PP Outlook: PP
Outlook: Propylene
• Weakening demand for PP affecting
propylene
• Price resistance due to falling PP prices
• Severe winter in China affecting propylene
trades
• Turnarounds at propylene plants in Japan to
tighten supply
19 19
Asia Editors:
WenYin Wong: Ethylene, PE, MEG
Marcus Pang: Propylene, PP
Thank you!