MOSCOW (MRC) - Consumption of polycarbonate (PC) in Russia decreased to about 86,000 tonnes in January-December 2015, down 4% compared to the same period last year, according to a MRC ScanPlast report.
The share of imports in total consumption of PC granules has decreased from 39% to 25%. In 2016, market players expect a further fall in imports into the Russian market on the back of rouble devaluation. At the same time, weakening demand in the market of finished products will affect the market and balance the deficit arising in the feedstock market during seasonal peaks.
For example, in 2015 the production of passenger cars in Russia decreased by 21% compared with the previous year and amounted to 1.254 mln pieces. Production of plastic sheets, plates and films reached 1.040 mln tonnes, up 1.8% year on year. As for housing construction, the square of new buildings in 2015 amounted to 83.8 mln sq. m, down 0.5% than in 2014. This figure has mainly been obtained thanks to the completion of projects started in 2014. In general, experts reported reduction the number of construction of new facilities in 2015 and the crisis in the industry.
The segment of cellular polycarbonate is the biggest in the consumption of feedstock in the Russian PC market. Cellular PC plates are widely used in housing and civil construction, as well as in agriculture. In 2015 the market has shrunk significantly. If in 2014 the demand for PC granules for sheet extrusion reached 80,000 tonnes, than in 2015 it shrunk by 10% to just a little over 71,000 tonnes. According to the expectations of market players, it will shrink further.
During the economic crisis in the country some customers in order to save money preferred lower-quality products, which adversely affects the sales of the major producers of high-quality sheets. In addition, the high volatility for PC granules during 2015, depending largely on the currency exchange rate, rather than by seasonality and objective market factors, led to a reduction in margins in the industry.
Market of PC granules in 2016 may be supported by the introduction of the new GOST for PC-sheets used in the construction and the State program of agriculture modernisation. However, we can see the effectiveness of these factors no earlier than the in end of the second quarter, when the spring season begins in the market. The producers of sheets, in spite of everything, have very positive expectations.
MRC