Global demand for PVC is dominated by the Asia-Pacific region

MOSCOW (MRC) -- Demand for polyvinyl chloride (PVC) is dominated by the Asia-Pacific region, which is bound to grow, driven primarily by the huge consumpion by China and the potential of the Indian market, reported Plastemart with reference to ReportLinker.

The region consumes more than half of the global PVC produced annually, while within the Asia-Pacific, China and India collectively consumed more than 75% of the regional demand.

Rigid applications of PVC hold a major share in the Asia-Pacific market, but significant investments in phthalate as well as non-phthalate plasticizers indicate a considerable growth for flexible PVC applications in the region.

ROW is expected to be the fastest growing PVC market, while Europe is also expected to add significant market demand by 2018, which is driven by strong anticipated growth in Russia and Turkey.

The demand for PVC is strong through the manufacturers of pipes, fittings, profiles, and tubes that account for more than 60.0% of the total global consumption. The PVC pipes are widely used in building, construction, chemical, energy, and other industrial applications.

Consumption of PVC for the manufacturing of profile & tubes and pipe & fittings is expected to grow at a highest CAGR of about 5.34% and 5.15%, from 2013 to 2018. The construction industry, was the major end user industry, using PVC products, accounting for more than 65.00% of the total global PVC consumption.

The increasing demand for electric vehicles, wood plastic composites, and innovation of bio-based additives, for the improvement of recycled PVC, enclose major opportunities in the PVC market.

Polyvinyl chloride (PVC) is among the most widely used polymers that finds its place in a diverse range of applications, owing to its properties and price effectiveness. It is manufactured by employing vinyl chloride monomer (VCM) as feedstock, which itself can be manufactured by ethylene dichloride and acetylene; EDC based process is more prevalent due to environmental concerns related to acetylene based route to VCM. More than 90% of the PVC production is by suspension resin polymerization process, while some considerable number of processes also use emulsion and bulk polymerization.

We remind that, as MRC wrote before, in April 2014, Solvay signed an agreement to sell its PVC compound business Benvic Europe to US investment company OpenGate Capital, further improving the resilience of the group’s portfolio. Benvic Europe mixes PVC and additives, pigments and stabilizers to make innovative plastic compounds, which are processed to serve markets ranging from cars and aircrafts to medical applications and construction.

Malaysia initiates preliminary investigation on PET imports

MOSCOW (MRC) -- Following a petition from a domestic producer requesting imposition of anti-dumping duty on imports of polyethylene terephthalate (PET), the Government of Malaysia has decided to initiate a preliminary investigation on imports of PET from the People’s Republic of China, the Republic of Indonesia and the Republic of Korea, said Mpponline.

The petitioner alleges that imports of PET originating in or exported from these countries are being dumped into Malaysia at a price much lower than the price in the domestic market and thus is causing material injury to the domestic industry in Malaysia.

The petitioner further claims that the imports from the alleged countries have increased in terms of absolute quantity. As a result, the domestic producers are reeling under pressure of price undercutting, price depression, price suppression, loss of market share, reduction in domestic sales, and decline in profitability and low return on investment.

In accordance with the Countervailing and Anti-Dumping Duties Act 1993 and its related Regulations, a preliminary determination will be made within 120 days from the date of initiation. If the preliminary determination is affirmative, the Government may impose a preliminary anti-dumping duty at the rate that is necessary to prevent further injury.

As MRC wrote before, Malaysia has imposed anti-dumping duties on polyethylene terephthalate (PET) imported from Thailand and biaxially-oriented polypropylene (BOPP) from China, Indonesia, Taiwan, Thailand and Vietnam. The duty on PET from Thailand will increase to 49.25% from zero for the period from 21 April 2011 through 20 April 2016. For BOPP imported from China, Taiwan, Thailand and Vietnam, a permanent anti-dumping duty of up to 12.37% will apply from 24 April 2013 to 22 Apr. 2018.

June prices of pipe grade HDPE rose by Rb2,000-3,000/tonne in Russia

MOSCOW (MRC) -- Seasonally stronger demand and tight supply have led to higher prices of pipe grade high density polyethylene (HDPE) in the Russian market. Prices of pipe grade polyethylene (PE) had risen by mid-month by Rb2,000-3,000/tonne from May, according to ICIS-MRC Price report.

Russian producers announced an increase in June contract prices of pipe grade HDPE on the back of stronger demand. At the same time, limited working capital of most pipes producers and a serious competition in the finished products market were major constraining factors in pricing of pipe grade HDPE in Russia.

Demand for pipe grade PE pipe grew in June. Upcoming scheduled outages for maintenance at Gazprom neftekhim Salavat (in July and August) and at Kazanorgsintez (in September and October) only heated the situation in the market. Some Russian pipes producers were still trying to build up inventories, despite the total lack of working capital and a low number of orders.

Deals for Russian natural PE100 were done in the range of Rb75,000-78,000/tonne FCA, including VAT, in the first half of June, while deals for coloured PE100 started from Rb79,000/tonne FCA, including VAT, depending on the terms of payment and quantaties. Prices of imported material rose to Rb85,000/tonne FCA, including VAT.

Weak demand for plastic pipes has led to a serious increase in competition among producers in recent years. The upward price dynamics for PE pipes is far behind the cost of its feedstock. Thus, there are still prices for PE pipes of small and medium diameter in the range of Rb86/kg FCA, including VAT, in the market, while prices of the feedstock -coloured PE100 - have come close to this level. The factor of a high competition in the finished pipes market is a serious constaint for price increases of pipe grade HDPE in the Russian market, and this trend will continue until the end of the year.

As reported earlier, demand for plastic pipes has been subsiding in the Russian market for the second consecutive year. According to official data of Rosstat, the overall production of plastic pipes in Russia fell to 198,000 over the first five months of 2014, down by 12.6% year on year. Last year's output totalled 586,400 tonnes of plastic pipes, down by 17% compared with the same figure of 2012.

PTT Global Chemical to shut LLDPE plant for maintenance in Thailand

MOSCOW (MRC) -- PTT Global Chemical (PTTGC) is likely to shut a linear low density polyethylene (LLDPE) plant for maintenance turnaround, as per Apic-online.

A Polymerupdate source in Thailand informed that the plant is planned to be shut in mid-July 2014. It is likely to remain off-stream for around three weeks.

Located at Map Ta Phut, Thailand, the plant has a production capacity of 400,000 mt/year.

As MRC reported earlier, last year, Indonesian state-owned energy company Pertamina signed an agreement to purchase petrochemical products from Thailand’s PTT Global Chemical. The agreement serves as a pre-marketing strategy for Pertamina and PTT’s joint Indonesian petrochemical business. Under the agreement, PTT will deliver at least 5,000 tonnes of polyethylene (PE) and polypropylene (PP) products each month to Pertamina for sale in Indonesia.

Recently, Pertamina and PTTGC have announced that they will start joint shipments of PE to the Indonesian market from 1 July 2014.

PTT Global Chemical is a leading player in the petrochemical industry and owns several petrochemical facilities with a combined capacity of 8.45 million tonnes a year.

SABIC becomes largest patent developer in the Middle East

MOSCOW (MRC) -- SABIC has passed the milestone of having more than 10,000 patents either issued or pending approval, making it the largest owner of intellectual property in the Middle East, as per the company's press release.

SABIC has also significantly increased the rate at which it obtains patents with 2013 seeing a record 373 patent applications filed by the company, a rise of over 300% from the figure in 2010. 2014 could see a further increase with 159 new patent applications applied for in just the first three months of the year.

On average, SABIC files a new patent application every 18 hours, each based on the work of approximately four researchers. This represents greater efficiency than any other top ten company in the chemical industry.

"Intellectual property is an important tool to help SABIC achieve its business goals," said Ernesto Occhiello, SABIC Executive Vice President, Technology and Innovation. "Our 10,400 global patent dockets are a reflection of our emphasis on innovation to support our growth," Occhiello said, pointing out that SABIC also has over 550 active disclosures under review.

As MRC wrote before, SABIC developed a new grade of high density polyethylene (HDPE) - SABIC HDPE PCG4906 - for large containers used in healthcare applications in close cooperation with Mauser, a well-known supplier of blow moulded industrial packaging solutions.

SABIC is a diversified manufacturing company, active in chemicals and intermediates, industrial polymers, fertilizers and metals. It is the largest public company in Saudi Arabia. It is the largest company in the Middle East.
SABIC is currently the second largest global ethylene glycol producer and is expected to become number one after the introduction of these new projects. SABIC is the third largest polyethylene manufacturer, the fourth largest polyolefins manufacturer and the fourth largest polypropylene manufacturer. It is also the world's largest producer of mono-ethylene glycol, MTBE, granular urea, polyphenylene and polyether imide.