PSCI March 2011

PE / PP Market Review

Singapore Shanghai Houston New York London Düsseldorf Dubai

Nick VafiadisDirector Polyolefins and PVC

North America

PSCIMarch 2011

PSCI March 2011

7 “Game Changers”

• Energy costs shift (nat gas / crude): now greatly favoring light feedstocks utilized in the US (ethane)

• US resin producers invest, and “shift-light”• New capacity: plagued by start-up problems• Strong global demand sparked by China• Export market became attractive and viable• Unplanned monomer and polymer outages: -

supply constraints drove pricing, not cost changes• Discipline

PSCI March 2011

Agenda

• Economy• Energy• Ethylene• Polyethylene• Propylene• Polypropylene

PSCI March 2011

00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15-3.0

-2.0

-1.0

0.0

1.0

2.0

3.0

4.0

5.0

World GDP Growth Rates(Constant 2007 U.S. Dollars)

Possible Scenario

Most Likely Scenario

Percent (%)

Forecast

PSCI March 2011

Positive Factors

Risks & Threats

Government Deficit & Debt

High Unemployment & Low Wage Growth

Geo-politics

Reduced Capital & Foreign

Investment

Emerging Market Economies

Low Interest Rates & Inflation

Mutual Support among

Regions

Con-

fidence

PSCI March 2011

07 Q2Q3Q4 08 Q2Q3Q4 09 Q2Q3Q4 10 Q2Q3Q4 11 Q2Q3Q4 12 Q2Q3Q454,000.0

55,000.0

56,000.0

57,000.0

58,000.0

59,000.0

60,000.0

61,000.0

62,000.0

Alternative Scenario

Main Scenario

World GDP GrowthQuarterly Annualized Value, Constant 2007 U.S. Dollars

02-04-0302-04-03

Trillion Constant 2007 U.S. Dollars

Peak – Q2 2008

Trough – Q1 2009

Q2 2010

PSCI March 2011

90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15-6.0

-4.0

-2.0

0.0

2.0

4.0

6.0

8.0

Economic Growth Comparison(Constant 2007 U.S. Dollars)

World N. America S. America W. Europe SE Asia NE Asia

Percent Change

PSCI March 2011

00

01

02

03

04

05

06

07

08

09

10

11

12

-8.0

-6.0

-4.0

-2.0

0.0

2.0

4.0

6.0

8.0

U.S. GDP GrowthPercent (%)

Source: U.S. Bureau of Census; Forecast: CMAI

Forecast

PSCI March 2011

U.S. Economy Outlook

• Confidence

Consumer – volatile at very low level

Business (ISM) – well above recession threshold• Retail Sales – improving steadily• Manufacturing – recovery abating• Construction/Residential – still at bottom levels• Construction/non-Residential – moderating declines• Vehicle Sales – moving higher • Trade – much reduced deficit is expanding again• Inflation – limited by output gap & high unemployment• Dollar – depreciating • Financial Markets – stabilizing

PSCI March 2011

Crude Oil Highlights• Crude oil price volatility drivers…

Global economic weakness has dampened crude demand Political instability in Middle East and Africa Speculative money Value of the U.S. dollar Crude & refined product inventory which remains high

• The crude oil price forecast anticipates… Despite short term demand reduction, global economy recovers

and demand growth returns. In spite of higher prices demand will continue to grow, especially in

developing nations such as India and China. Higher demand will support prices averaging$100 per barrel level

through 2011 and move higher in 2012 In the medium to long term, continued non-OECD demand growth

keeps pressure on OPEC to sustain high output Tight S/D balance supports elevated prices in the medium to long

term.

PSCI March 2011

Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-1220

40

60

80

100

120

140

New Forecast Old Forecast

Dollars Per Barrel

WTI Crude Oil Forecast Comparison

PSCI March 2011

00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 150

20

40

60

80

100

120

New Forecast Old Forecast

WTI Crude Oil Forecast ComparisonDollars Per Barrel

PSCI March 2011

05

Q2

Q3

Q4

06

Q2

Q3

Q4

07

Q2

Q3

Q4

08

Q2

Q3

Q4

09

Q2

Q3

Q4

10

Q2

Q3

Q4

11

Q2

Q3

Q4

12

Q2

Q3

Q4

300

400

500

600

700

800

900

1,000

1,100

Global Naphtha Prices

US Natural Gasoline West Europe NapthaSoutheast Asia Naptha Notheast Asia Naptha

•Dollars Per Metric Ton

PSCI March 2011

0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0250000

270000

290000

310000

330000

350000

370000

390000U.S. Crude Oil Inventories

5-Yr MIN-MAX Range 20092010 2011

Million BarrelsMillion Barrels

•Data Through 11-Feb-11 - Excludes U.S. Strategic Petroleum Reserve

PSCI March 2011

Natural Gas Highlights• The natural gas price forecast anticipates…

Prices will remain relatively stable vs 2010 due to strong supply and rising crude prices

In 2011, LNG imports and production from shale will keep supply healthy and prices low relative to crude oil.

In the medium to long term, supply from shale remain high.

Increasing LNG imports to meet demand growth as needed.

Long term crude to gas ratio is below parity due to healthy natural gas supply

PSCI March 2011

•U.S. "Working Gas" In Underground Storage

•Data Through 24-Jul-09

Jan

Jan

Jan

Jan

Feb

Feb

Feb

Feb

Mar

Mar

Mar

Mar

Apr

Apr

Apr

Apr

Apr

May

May

May

May

Jun

Jun

Jun

Jun

Jul

Jul

Jul

Jul

Jul

Aug

Aug

Aug

Aug

Sep

Sep

Sep

Sep

Sep

Oct

Oct

Oct

Oct

Nov

Nov

Nov

Nov

Dec

Dec

Dec

Dec

Dec

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000Weekly Data - Billion Cubic Feet

5-Yr MIN-MAX Range 5 Year Average Range 2009 2010 2011

•Data Through 11-Feb-11

PSCI March 2011

05

Q2

Q3

Q4

06

Q2

Q3

Q4

07

Q2

Q3

Q4

08

Q2

Q3

Q4

09

Q2

Q3

Q4

10

Q2

Q3

Q4

11

Q2

Q3

Q4

12

Q2

Q3

Q4

0

50

100

150

200

250

0

4

8

12

16

20

U.S. Natural Gas Liquids Prices

Natural Gas Ethane Propane N-Butane

Gas Liquids,Cents Per Gallon Natural Gas$/ MMBtu

PSCI March 2011

New Ethane Frac Capacity• The capacities listed in thousand barrels per day of ethane with the total fractionation capacity in

thousand barrels per day in parenthesis.  

• 2010:   Q2 – Copano – Houston, TX  10 (24)• Q4 – Enterprise Fractionator, Mt. Belvieu, Texas – 30 (60)• 2011:             • Q2 – Targa Resources, Mt. Belvieu, Texas – 30 (60)•             Q3 – Copano – Houston, TX Expansion 5 (11)• Q3 – MarkWest, Houston, PA – 30 (60) – This project will not affect the ethane balance on the USGC

immediately since no decisions have been finalized on the disposition of the ethane.

• 2012:• 1H 2012 – Gulf Coast Fractionators, Mt. Belvieu, TX – 20 (43)• 2H 2012 – Enterprise, Mt. Belvieu, TX – 30 (65)• 2H 2012 – Targa, Mt. Belvieu, TX - 45 (100)

• 2013:•             1H 2013 – Formosa, Point Comfort, TX – 32 (75)• Others:• Dominion Resources planning to build a unit in West Virginia with a  capacity of 15 kbbl/day of ethane (38).  The

disposition of the ethane from this plant is not currently known. Could be early 2013. 

PSCI March 2011

05 06 07 08 09 10 11 12 13 14 150

50

100

150

200

250

0

1

2

3

4

5

6

7

8

9

10

U.S. Natural Gas Liquids Prices

Natural Gas Ethane Propane N-Butane

•Gas Liquids•Cents Per Gallon

•Natural Gas•$/ MMBtu

PSCI March 2011

00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 150

2

4

6

8

10

12

14

16

18

20

0%

20%

40%

60%

80%

100%

120%

Crude (WTI) Natural Gas Gas as % of Crude

$ / MM Btu

New Forecast

Gas as a % of Crude

North America Energy Trend Prices

PSCI March 2011

05 Q2

Q3

Q4

06 Q2

Q3

Q4

07 Q2

Q3

Q4

08 Q2

Q3

Q4

09 Q2

Q3

Q4

10 Q2

Q3

Q4

11 Q2

Q3

Q4

0

10

20

30

40

50

60

0

220

440

660

880

1,100

1,320

Wt. Average Propane Butane Lt. Naphtha Purity Ethane

Dollars Per TonCents Per Pound

U.S. Ethylene Cash Costs

PSCI March 2011

NAM Avg.

WEP Avg.NEA Avg.

SEA Avg.

ISC Avg.

MDE Avg.

50

250

450

650

850

1,050

1,250

1,450

0 20 40 60 80 100 120 140 160

CUMULATIVE ETHYLENE CAPACITY (million tons)

2011 Global Ethylene Cash Costs Dollars Per Metric Ton

Average Feedstock Basis

Heavy Feed

Light Feed

PSCI March 2011

00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15-8

-4

0

4

8

12

16

North America Middle East Southeast Asia West Europe

Northeast Asia Others Annual Demand Change

Million Metric Tons

Forecast

Ethylene Capacity & Demand Changes

PSCI March 2011

…So Why Aren’t We Swimming In Middle East Olefin Derivatives?

• Project delays, especially derivative capacity

• Stronger demand than expected, led by China

• Capacity closures in North America and West Europe reduce supply-demand imbalance

PSCI March 2011

Poor Operating Rates

50

60

70

80

90

100

110

120

90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15

Middle East Saudi Arabia Iran Kuwait Qatar UAE

% Nameplate Operating Rate, Middle East

Forecast

Historical Average = 92%

PSCI March 2011

Global Ethylene Operating Rates

Forecast

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 201565

75

85

95

105

115

N. America West Europe Middle EastNortheast Asia World

Percent

PSCI March 2011

01

Q2

Q3

Q4

02

Q2

Q3

Q4

03

Q2

Q3

Q4

04

Q2

Q3

Q4

05

Q2

Q3

Q4

06

Q2

Q3

Q4

07

Q2

Q3

Q4

08

Q2

Q3

Q4

09

Q2

Q3

Q4

10

Q2

Q3

Q4

11

Q2

Q3

Q4

12

Q2

Q3

Q4

9

10

11

12

13

14

15

16

17

65%

70%

75%

80%

85%

90%

95%

100%

Total Demand Effective Operating Rate Nameplate Operating Rate

Billion Pounds Operating Rate

Forecast

U.S Ethylene Supply/Demand Outlook

PSCI March 2011

U.S. Ethylene Margins

2008 2009 2010 2011 2012 2013 20140

5

10

15

20

25

0

110

220

331

441

551

U.S. Wtd. Avg Contract Cash Margin

Dollars Per TonCents Per Pound

Forecast

PSCI March 2011

PE: US Current Status• Domestic PE resin demand has been stable• Price increases pending for March (2 – 6) cpp and 5 cpp for April• Global uncertainties around Middle East, Japan, keep

pressure on crude oil prices and provide momentum for higher resin pricing

• Production cash costs rising as ethylene moves higher• Inventories snug for LLDPE and LDPE while HDPE

appears adequate• Export options remain attractive for US producers

utilizing light feedstocks -

PSCI March 2011

PE Demand Year Over Year

U.S./Canada Polyethylene Demand

  Percent Change, Year over Year %AAGR %AAGREnd Use 06 07 08 09 10 '05-‘10 ‘10-'15

Film & Sheet -1.0 4.1 -11.4 -0.5 6.2 -1.4 2.7

Injection Molding -1.4 -4.0 -12.0 -4.4 7.5 -4.0 2.6

Pipe & Profile 15.8 -6.7 -8.6 -17.2 19.1 -3.1 3.7

Extrusion Coating -6.9 -2.6 -8.3 -11.0 17.5 -4.9 3.1

Blow Molding 0.3 -2.8 -11.5 -0.8 6.9 -2.0 2.9

Wire & Cable 9.1 -0.3 -3.0 -2.3 4.3 1.4 2.1

Rotomolding 4.9 -5.0 -3.8 -6.0 18.0 -1.2 3.9

Domestic Demand

3.8 -1.0 -12.5 -5.0 8.5 -2.7 2.9

PSCI March 2011

HDPE in 2010

• Domestic resin sales: +6.1%• Export sales: -24.1• Total HDPE resin sales: +1.8

PSCI March 2011

•Source: ACC, Plastics Division; Gov’t Trade Data

HDPE – Injection Molding 2010 Results

HDPE Percent Change

Injection Molding, Total 4.2

Pails -1.5

Housewares 15.5

Tubs and Containers 17.4

Crates and Totes 19.3

Caps and Closures -11.5

PSCI March 2011

HDPE Cost and Price

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 201520

30

40

50

60

70

80

90Cents Per Pound

North America Cash Cost - Integrated North America HDPE Contract Disc.

West Europe HDPE Contract Disc. CFR China HDPE Spot

PSCI March 2011

Regional HDPE Non-Int. Margins

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015-265

-177

-89

-1

87

175

263

-12

-8

-4

0

4

8

12

16

West Europe Southeast Asia North America

351Dollars Per Ton Cents Per Pound

PSCI March 2011

Jan-0

8

Mar

-08

May

-08

Jul-0

8

Sep-0

8

Nov-08

Jan-0

9

Mar

-09

May

-09

Jul-0

9

Sep-0

9

Nov-09

Jan-1

0

Mar

-10

May

-10

Jul-1

0

Sep-1

0

Nov-10

-300

-200

-100

0

100

200

300

400

Asia Europe SAM NAM Other Net Trade

Thousand Metric Tons

Imports

Exports

U.S. Monthly Total PE Trade

PSCI March 2011

U.S. PE Trade Trends

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015-4,000

-3,000

-2,000

-1,000

0

1,000

2,000

3,000

4,000

5,000

6,000

0

5

10

15

20

25

30

35

40

Imports Exports Production as a % of Exports

Million Metric Tons Percent

Forecast

PSCI March 2011

Polyethylene Capacity Changes  NAM WEP MDE NEA / SEA / ISC Net

Increase  Company kta Company kta Company kta Company kta

1Q-10

        Borealis BEL HD (200) Yansab KSA HD 400 Sinopec/SABIC JV CHIHD/LL 600  

        Borealis SWEHD/LL (90) Sharq KSA HD 400 PTT Chem THA LD 300  

        SABIC UK LD 400 Qatofin QAT LL 450 Bangkok PE THA HD 250                          Panjin Eth. CHI HD 300  

                        Haldia INDHD/LL x 125 2,935

2Q-10

        LBI GFR HD 250         Zhenghai Ref. CC CHI LL 450  

        Borealis SWE LD 350         MOC THA LL 300  

        SABIC NET LD (120)         TPE THA HD 400                          CNOOC & Shell CHI LD 75                          Indian Oil IND HD 300  

                        Indian Oil INDHD/LL 350 2,355

3Q-10

                Borouge UAEHD/LL 600 Baotou Shenhua CHI

HD/LL 300  

                        CNOOC & Shell CHI HD 75                          Gail IND LL 50  

                        LG Chem KOS HD 40 1,065

4Q-10

Nova CAN LD x 60Polimeri

Eur. FRA LD 260 Q-Chem II QAT HD 350                          Amir Kabir IRN LD 300                                970

PSCI March 2011

Polyethylene Capacity Changes  MDE NEA / SEA / ISC Net Increase

  Company kta Company kta

1Q-11

Kayan SAR HD 400

  400

2Q-11 0

3Q-11

ExxonMobil SIN HD/LL 650  ExxonMobil SIN LL 650  1,300

   

4Q-11

  

  

 Zhongyuan

Evolue JapanCHIJAP

LLLL

6050  110

  MDE NEA / SEA / ISCNet Increase

  Company kta Company kta

1Q-12

QAPCO QAT LD 250 Hanwa Chem. KOS LD 30

Llam PC IRN HD 300 Sichuan PC CHI HD/LL 600

Saudi Polymers SAR HD 1100 Qilu PC CHI HD 250 2,530

2Q-12

  Fushun PC CHI HD/LL 450  

  Fushun PC CHI HD 350  800       

3Q-12

Honam PC KOS HD 210  210           

4Q-12  

 

  

  0

PSCI March 2011

Forecast

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 201570

75

80

85

90

95

World WEP MDE NEA NAM

Global Total PE Operating RatesOperating Rate, Percent

Forecast

PSCI March 2011

Price Differentiation

30

40

50

60

70

80

90

100

661

882

1102

1323

1543

1764

1984

2205

LDPE GP HDPE BM LLDPE C4

(NAM Discounted Prices) Dollars Per Metric Ton

Forecast

Cents Per Pound

PSCI March 2011

38353 38718 39083 39448 39814 40179 40544 40909 41275 41640 420050

10

20

30

40

50

60

0

220

440

660

880

1,100

1,320

Ethylene Margin - Average Acquisition Ethylene Price Minus Ethane Cracking Costs

PE Margin - Contract HDPE Blow Molding Non-Int. Including Discounts

Ethane Margin - Ethane Price Minus Shrinkage & 5.5 cpg Extraction Costs

Cents Per Pound Polyethylene Dollars Per Metric Ton

U.S. Polyethylene Chain Margins

Forecast

PSCI March 2011

PE Take-Aways• Hindsight: Energy shift, start up delays, export options, and

unplanned outages transform would-be trough to record profits for US resin producers

• US producers: sitting on cash – expansions likely• Price: increasingly tied to global naphtha price trends, and

export options• – unplanned outages remain the wildcard• New capacity: in MDE and China will be absorbed – less

dramatic impact on pricing and margins• Export market: remains attractive for US resin producers –

resin imports minimized• Imports: Reduced incentive to import resin and film and bags• Watch out: Too rapid, and too high crude increase could kill

demand and resin prices could fall as in 2008

PSCI March 2011

Propylene Polypropylene

PSCI March 2011

Stm. Crackers

58.1%

FCC Split-ters

31.4%

Dehydro3.4%

Metathesis3.3%

Olefin Cracking

0.3%Gas-to-Olefins0.2%

HS FCC2.6% Others

0.7%

Production 75.5 MMT

World 2010 PG/CG Propylene Supply/Demand

Acrylic Acid4%

Acrylonitrile7%

Cumene4%

Oxo Alc.8%

Polypropylene67%

Propylene Oxide7%

Others2%

Demand 74.6 MMT

PSCI March 2011

86 Q2

Q3

Q4 91 Q

2Q

3Q

4 96 Q2

Q3

Q4 01 Q

2Q

3Q

4 06 Q2

Q3

Q4

0

1

2

3

4

5

6

7

8

9

10

Propylene Production6 Billion Pounds Lost

Co-Product Propylene Refinery Sourced Propylene

Billion Pounds

Lowest production since before 1990

PSCI March 2011

Acrylic Acid6%

Acrylonitrile10%

Cumene1%Isopropanol

1%

2-Ethyl Hexanol2%

Butanols5%

Polypropylene58%

Propylene Oxide11%

Others5%

Domestic Demand = 13.5 Million Metric Tons

North America2010 PG/CG Propylene Demand by End Use

PSCI March 2011

Domestic Demand Still In Doldrums

39083

39114

39142

39173

39203

39234

39264

39295

39326

39356

39387

39417

39448

39479

39508

39539

39569

39600

39630

39661

39692

39722

39753

39783

39814

39845

39873

39904

39934

39965

39995

40026

40057

40087

40118

40148

40179

40210

40238

40269

40299

40330

40360

40391

40422

40452

40483

40513

40544

40575

350

400

450

500

550

600

IM Average

Million Pounds

PSCI March 2011

•Source: ACC, Plastics Division; Gov’t Trade Data

PP 2010 ResultsPolypropylene Percent Change

Injection Molding, Total 2.6

Appliances 19.4

Consumer Products -4.5

Rigid Packaging, Total 1.5

Cups and Containers -15.9

Caps and Closures 13.3

Crates and Totes 16.1

Media Enclosures 12.1

All Other Injection Molding 67.6

PSCI March 2011

North America PP IndustryDemand 2010-2015

2.4 %

Other

Fiber and Filament

Film and Sheet

Blow Molding

Injection Molding

0 500 1,000 1,500 2,000 2,500 3,000 3,500

2015 2010

Total Domestic Demand 2010: 6.9 MMT

Total Domestic Demand 2015: 7.7 MMT

Total Percentage Growth Rate 2010-2015: 2.0 %

Million Metric Tons

2.6%

1.6%

3.0%

2.4%

2.3%

PSCI March 2011

Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-110

500

1,000

1,500

2,000

2,500

3,000

0

15

30

45

60

75

90

ACN Asia PGP NAM

ACN, $/Ton C3, Cents per Pound

Cracker Turn-arounds

Extreme TX Weather + Refinery

Turnarounds + High ACN

Prices

December C3 Produc-tion Issues

+High Cotton

Prices +High ACN

Prices

PGP Price Drivers: Crude, ACN, Supply

PSCI March 2011

Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-120

10

20

30

40

50

60

70

80

90

0

220

440

660

880

1,100

1,320

1,540

1,760

1,980

WE Contract Net Transaction CFR SEA Spot US Contract Net Transaction

Cents Per Pound Dollars Per Metric Ton

Regional Propylene Prices

Forecast

PSCI March 2011

NAM Moving to Top of PP Price Chain

39814

39845

39873

39904

39934

39965

39995

40026

40057

40087

40118

40148

40179

40210

40238

40269

40299

40330

40360

40391

40422

40452

40483

40513

40544

40575

40603

40634

40664

40695

40725

40756

40787

40817

40848

40878

40909

40940

40969

41000

41030

41061

41091

41122

41153

41183

41214

41244

600

800

1,000

1,200

1,400

1,600

1,800

2,000

2,200

NAM PP Disc. Price WEP PP Disc. Price NEA PP Spot NAM PP Spot Export

Dollars Per Metric Ton

Forecast

PSCI March 2011

2009 2010 2011 2012 2013 2014-1,000

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000PP, Million Metric Tons

North America South AmericaAsia/Pacific West Europe

C. Europe/CISAfrica/Middle East

Forecast

Capacity: How Much is too Much?

2009-2011 17 Million Metric Tons

PSCI March 2011

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015-4

-2

0

2

4

6

8

10

12

14

70

75

80

85

90

95

100

Capacity Increase - Demand Increase Cummulative Delta Caps-Delta DemOperating Rate

PP, Million Metric Tons

Forecast

Operating Rate, Percent

Investment Excess

Demand Drop

Oversupply!+ =

PSCI March 2011

07

FMAMJ JASOND08

FMAMJ JASOND09

FMAMJ JASOND10

FMAMJ JASOND0

20

40

60

80

100

120

140

0

50

100

150

200

250

Total Selected Regions N.America S.America EuropeFar East Other

Regional Exports, Thousand Metric Tons Total Exports, Thousand Metric Tons

U.S. PP Exports

PSCI March 2011Thousand Metric Tons

20102015

-308

-504

-4694927

-399

-2607

709

556

-57

-4891788

-75

-1747

-239

-1350263

Trade Patterns ChangingPolypropylene Trade

PSCI March 2011

PP Summary• Propylene remains scarce – keeping

propylene and PP prices high • Volatility in N. Am here to stay.• PP less competitive• Through propylene capacity investments,

imports, and replacement by other polymers – US PP prices will ultimately align with rest of the world (within five years).

PSCI March 2011

Thank You!

• Presentation Copies• Report Trials ( Global Plastics and

Polymers Report)• Conference – Houston, Chicago

• N. Vafiadis contact info:

281-752 -3206

nvafiadis@cmaiglobal.com