Plastic Production France

Plastiques Modernes & Elastomeres magazine Supplement issue n.4 1999

 In 1998, the volume of manufactured plastics increased in almost every category, with a growth in real consumption of 4.5%.Only PVC and RLDPE (radically low-density polyethylene) saw a decrease in production. Global plastic production rose 3.5% in 1998 with a total volume of 6 million tons produced. This increase can be explained by the greater number of uses for plastics in Eastern Europe, Asia, and Latin America. Exports were down 3%, while imports rose 5% during the same year. BP and Amoco have formed a partnership for the production of PP (polypropylene) and polysulfones. There is also a trend for joint-venture partners to sell portions of their business, as in the case of Hoechst and BASF, and Neste Statoil/Borealis. American corporations such as Visteon, Moll Industries, and Venture Holdings are beginning to establish themselves on the European continent.

 The French economy grew by 3.2% in 1998, with an internal market that boasted a 6% increase in consumer       ur    purchasing power. Exports decreased by 1.7% in the final quarter of 1998, leading to a slowing in the growth of in  in    vestments in 1999. Several plastic markets remained healthy. Automobile sales jumped 9% to 118 billion FF, and th    the French auto industry experienced a 12.9% growth rate between January and April 1999. There were 1.1 million to    tons of plastic packaging produced (up 3.5% from 1997). The construction industry grew by 1.2% to 439.91 billion with an expected 1999 global growth of 2.9%.

Polyethylene (PE)

 Global demand for PE grew by an average of 5.6% between 1993 and 1998, with similar growth expected to continue over the next five years. PE saw a strong year in Europe in 1998 with an estimated 10.7 million tons being consumed, 4.65 million tons of which were RLDPE, 4.15 million tons of which were HDPE (high-density polyethylene) and 1.9 million of which were LLDPE (linear low-density polyethylene). Packaging remained the main use of PE, with 70% of the total consumption. Borealis continues to be the leading PE producer in Europe and the fifth largest producer of PE in the world.

 LLDPE (linear low-density polyethylene). - French production is down 3% to 355,000 tons. Imports are up 2% while exports decreased by 10%. European consumption of LLDPE rose 9% in 1998 (compared to a 6% rise in French consumption) to reach 1.9 million tons, 18% of total PE consumption. LLDPE is expected to reach 28% of total European PE consumption by 2005, as it continues to take business away from the more expensive RLDPE as well as from paper and cardboard packaging. European capacity for LLDPE manufacturing will increase dramatically with the opening of a Dow plant in Germany, and the 2001 opening of an Elf Atochem plant (LLDPE prices fell by 25% during 1998).

 RLDPE (radicular low-density polyethylene)  French production remained the same as 1997, at 694,000 tons. Imports increased by 7% while exports only increased by 2%. This can be accounted for by the two-month closing of the Polimeri de Dunkerque plant for maintenance, decreasing French output by 10,000 tons. European consumption of this plastic remained relatively stable at 4.65 million tons. Film manufacturing represents 75% of the RLDPE market, and the stability of this industry has resulted in stable RLDPE production.

 HDPE (high-density polyethylene)  HDPE import levels surpassed export levels for the first time. Import increased 8% to reach a record level of 385,000 tons. High demand for HDPE led to maximum European output, with France producing 19% more HDPE than in 1997 (535,000 tons). Global demand is expected to increase by at least 5% between 1997 and 2003. European consumption increased by 6%, reaching 4.2 million tons, with French consumption increasing by 9% and reaching 560,000 tons mainly due to the appliance and automobile industries. Small container packaging registered a 14% growth in 1998, while the injection sector saw a 10% growth as well. Half of the HDPE produced is used by the moulding sector, which itself grew by 10% last year. Other HDPE users include the pipe and tubing industry, the cable market, and the film industry, which utilises 20% of HDPE produced. HDPE prices fell 10% between 1997 and 1998.

Polypropylene (PP)

 European PP production rose by 400,000 tons in 1998 to reach 6.9 million total tons produced. French production rose 6.8% to 1,355,000 tons. Factories are producing PP at over 90% maximum capacity. Since no real growth in French capacity is expected in 1999, there should not be any major increase in production. In 2000, however, there will be a 280,000 tons produced at the Montell Company's plant in France, a 200,000 tons at the DSM Company's plant, also in France, and 250,000 tons in Spain. Imports rose 2.2% to 251,000 tons, while exports saw a 3% growth to 771,000 tons. European PP consumption rose 6.5% to reach 6.2 million tons in 1998, with the larger consumers such as Germany and Italy using over a million tons each. Meanwhile, French consumption rose by 7 %. PP is mainly used in the automobile (bumpers and external auto bodies) and packaging industries, both of which have done well in the past year. While it is still a small market in France, thermoforming has continued to grow. Injection machines for PP use have also been improved in 1998. Prices of PP fell in 1998, dropping 40% for homopolymers and 25% for propylene.

Polyvinyl chloride (PVC)

 The European PVC market consists of 13 producers. Western European production decreased by 100,000 tons in 1998, and French production fell by 4% in the same period, to 1.2 million tons. French imports were down 7.3%, while exports decreased as well, but by a lesser amount. Global consumption of PVC rose by 4% due, mainly to the building and medical industries, with a small rise in the tubing industry as well. The only regions with expanding PVC markets are Latin America, Eastern Europe and Asia. The greatest impact on the PVC industry came from the 30% drop in bottle production in the past year as companies such as Vichy and Badoit have opted to use PET (polyethylene terephthalate) instead of PVC. Overall PVC consumption fell by 7% in 1998. Also, PVC prices fell due to the Russian and Asian crises, dropping 30% compared to 1997. The fall in prices continued during the first four months of 1999, and there has been a 5% decline since the beginning of the year 2000.

Polystyrene (PS)

 As with PVC, production of PS in Europe is at 90% capacity, and demand remains high. Global PS capacity is estimated at 12.7 million tons, with Western European capacity at 2.3 million tons and Eastern European capacity at 1.2 million. Europe still has only seven producers, accounting for 95% of the PS market. European consumption in 1998 is estimated to be over 2 million tons, a 3.5% rise over 1997. French consumption followed the European growth trend, with a 3.5% growth rate to 285,000 tons. Sixty-two percent of French PS consumption is in the packaging industry, far above the European average of 40-45%. This increase was a result of the growth in the television screen market, inflated in 1998 due to the increased sales of televisions brought about by the World Cup. The CD market is also a factor in PS consumption, as Europe alone uses 145,000 tons annually for CD cases. In 1999, Dow is expected to open a factory in France with the capability of producing 130,000 tons of PS each year.

Expanded polystyrene (EPS)

 French EPS production remained stable in 1998. Imports into Europe (mainly from South Korea) increased by 13%, or 40,000 tons. French demand increased by 9% to 107,000 tons, but countries such as Germany saw a decline in demand. French demand is due to a 15% increase in the construction sector as well as to a 6% increase in the packaging sector. Nevertheless, prices decreased by approximately 25-30%.

Acrolonitrile-butadiene-styrene (ABS)

 Recent world wide ABS production decreased, with BASF closing two plants, one in Korea, the other in Mexico. This has resulted in a drop in production of 17,000 tons between 1997 and 1998. However, the future looks brighter, as Bayer has planned the 2002 opening of a plan with a 100,000-ton production capacity. Also, demand for ABS appears to be increasing. After years of reduced demand, this polymer has seen a second straight year of increasing demand in Europe. French demand saw a slight one percent growth to reach 57,500 tons. However, the greatest growth was seen in Germany. New technology has allowed the use of cheaper ABS in place of PP in some areas of the automobile industry (it is being used in the interiors of the VW Beetle and the next generation Golf). Its resistance to shock also makes it a favoured material in the booming cellular phone business. ABS prices are expected to increase in 1999 after the 1998 fall in prices.

Polyurethane (TP)

 In coming years, several new European TP production plants will be opened. French production has increased by 6.8% in the last year. Soft-foam TP use in automobiles increased by 10% last year, while hard-foam TP saw a 5% increase in use in the construction industry. TP is also used in the furniture and bedding industry, which itself saw a rise of 8%. Research continues to improve the fire-resistance of TP with the expectation that it will become a cheaper and more effective fire-retardant than current materials. Prices for TP remained relatively stable throughout 1998, especially in the automobile sector.

Polycarbonate PC)

Bayer and GE Plastics make up 80% of the PC market, but several producers are building new PC production plants. The French market is estimated to be around 30,000 tons per year and has grown 15% in the past year. PC is mainly used in optical applications such as compact disks (which used 9,000 tons of PC in 1998, a 20% increase), eye-glass/contact-lenses, and automobile lights. The main market for PC, however, is the electronics industry. Western European consumption grew an estimated 12% in 1998, reaching 276,000 tons. French consumption grew to an estimated 4,500 tons to reach a total of 30,500 tons of PC utilised in 1998. Shortages occurred, causing PC prices to rise by 4% in 1998.

Polybutylene terephthalate (PBT)

 European PBT consumption increased by 10% from 1997 levels, surpassing 100,000 tons in 1998. French production increased by 8%, while German production increased 20%, due to a thriving automobile industry. Automobile wiring grew by 35%, while other PBT-consuming industries, such as electrical appliances, remained stable. PBT continues to suffer from competition from PP, PA and ABS in the electrical appliance industry. Prices remained stable throughout 1998.

Polyethylene terephthalate (PET)

 DuPont and DSM make up 80% of the European PET injection market. As it is more heat-resistant than PBT, injected PET is often used for electric wiring, including automobile and electrical appliance wiring. The increase in French demand for PET injection was equal to that in Europe, at 4%, with a total production of 1,500 tons in 1998. Unlike the highly fluctuating prices of PET used in packaging, injected PET prices remained stable. European production of PET used in packaging reached 1.31 million tons in 1998 compared with 1 million tons produced in 1997. Global demand for PET used in packaging is up to 5 million tons per year, with the most growth being in the film sector (up 25%). However, PET has seen a decrease in its rate of growth, as markets in North America and Europe have matured. After a growth rate of 15% in 1997, the 1998 increase in consumption was only 9%. The increase in French demand was above the European average, because France continues to use PET as a substitute for PVC in mineral water bottles (215,000 tons). Regional markets that should see the most growth include Eastern Europe and Latin America. A possible revolution may occur in the bottling industry with the use of PET as a substitute for glass in the beer bottle market.

Polyamide nylon (PA)

 PA 6 and PA 6.6

European demand for PA 6 and 6.6 decreased between 1997 and 1998, resulting in a drop in prices. This decrease in demand is partly due to the substitution of PA by PBT and PP, which are both cheaper and hold together better under high temperatures. Nevertheless, French consumption of PA 6 went up 9%, and PA 6.6 increased by 8%. PA 6.6 remains the most used of the two, with France consuming 54,800 tons in 1998 compared to 18,800 tons of PA 6. The automobile industry is the main consumer of PA 6/6.6, consuming 10-15% of this plastic product. Another main industry that uses PA 6/6.6 is the electrical appliance industry, where it has shown excellent growth, just as in the automobile industry. Further uses for PA 6/6.6, including ski equipment, fishing reels, and inline skates, are being developed.

PA 11 and 12

There was little change in the PA 11/12 industry between 1997 and 1998. Elf Atochem is the sole producer of PA 11. World consumption of PA 11/12 grew by 4% in 1999, while Asia saw a 20% drop in consumption. Meanwhile, Europe witnessed a less dramatic rise in consumption, as 1998 levels were only 6% above those of 1997. France saw an 8% rise as the use of injection techniques contributed to a 15% increase in consumption for the PA 11/12 industry. However, extrusion represents 80-85% of the possible uses of PA 11 and 12 in the transportation, telephone, electronics, and ski industries. High demand has resulted in higher prices. Future increased production should lead to a stabilisation of PA 11/12 prices.

Polyoxymethylene (POM)

 DuPont, Ticona, and BASF make up 90% of the French POM market. Demand increased by 8% in the United States, with a growth rate of 5% in Europe. In Asia, POM is mainly used in the electronics sector (CDs, videocassettes). In contrast, in Europe, it is largely used in the automobile industry and the electrical appliance sector. French consumption registered a 3% increase in 1998 to a level of 23,500 tons. The automotive industry continued to be the main consumer of POM. PA began to replace POM in some sectors of the sporting goods industry, for example ski bindings. Additionally, pressures caused by Asian imports have lowered copolymer prices by 10%.

Polymethyl methacryiate (PMMA)

 European consumption of PMMA reached 258,000 tons last year, an increase of 4% over 1997. Of this amount, 163,000 tons were full sheets, 83,000 tons flow sheets, 80,000 tons extruding sheets, 10,000 tons alveolus sheets, and 84,000 tons granules. Import levels of granules stayed identical to those of 1997 (12,000-13,000 tons). The European market for full PMMA sheets rose 6% in 1998, whiles the extruded sheet market increased by over 10%. As for European consumption of granules, this market, saw a 5% increase. French consumption of sheets and granules increased only slightly, to an estimated 29,000 tons in 1998.

 Injection represents 90% of the granule market, with the other 10% being used in the construction industry. After a 3-4% drop in the French market in 1997, growth was 7% in 1998. This was slightly higher than Europe's average growth of 5%. The year 1998 was a good year in terms of volume for both France and the rest of Europe, with the automobile industry, a major user of granules, using 50% of production. In the sheet market, despite competition from Asian manufacturers, European production of PMMA sheets increased by 6%. The French full sheet market saw a 5% growth in 1998 with the German market increasing by 3% and Great Britain and Italy's increasing by 5% and 3%, respectively. In the full sheet market, the construction sector is the greatest consumer, with a 7% growth, due to the increased demand for and production of noise-reduction walls. The prices of both PMMA granules and sheets dropped in 1999 as costs of production were cut in order to compete better and respond to the demands of automobile manufacturers.

Polyphenylene sulfide (PPS)

 The world market for PPS is estimated to be no more than 30,000 tons. The European market increased by 6% in 1999, compared to 12% the previous year. The two principal consuming sectors are the automobile and electrical appliance industries. Both industries experienced a reduction in the amount of PPS used. The reduced growth in the PPS industry is due to the crises in Russia and Brazil, as both countries are major consumers of European electrical appliances. As a result of these developments, France only had a 100-ton increase in consumption in 1998 over 1997. With an ever-increasing demand for lighter automotive parts, PPS retained only a 50% share of the automotive market, as opposed to the 55% it held in 1997. Philips has recently developed two new plastics based on PPS in order to compete with PA. Despite a saturated market PPS market, prices remained stable in 1998.

Liquid crystal polymer (LCP)

 Ticona dominates the LCP market with an estimated 70% of production. No new LCP production plants are planned, but the industry is still growing albeit slightly. The amount of LCP produced globally in 1998 was 5,000 tons, an increase from the 4,800 tons produced in 1997. This growth can be attributed to demand in Europe, and more particularly in France. The latest line of Tupperware was manufactured with LCP, raising French consumption of the plastic to over 600 tons. Although LCP is being replaced in many areas with cheaper, high-performance PA it is still finding a niche in the booming communications, cellular phone and computer markets. In addition, research is also being done on using LCP for interior linings in perfume bottles. LCP prices dropped an estimated 10% in 1998.

source: http://www.eurotradeinfo.com/plastic_production.htm 5mar01