Polypropylene (PP) enjoyed a growth of more than 6% annually until the year 2000 and its future growth is only expected to slow slightly, according to Industrial Information Resources, Inc, of Houston, TX. PP’s diversity in end uses has helped sustain its growth through a very slow 2001 industrial spending year and estimates indicate growth for the next two years will be approximately 4% annually despite a rapidly slowing economy.
Capacity increases over the last two years, such as new unit additions by both ExxonMobil and Dow, have brought nearly 1.2 billion pounds per year of new capacity to the market, with some producers reducing operating rates as capacity slowly crept past demand. Industrial Information reports that additional capacity is scheduled to come on-stream in the second quarter of 2002, when Phillips Petroleum begins operations at its new 775 million pound per year unit at its Bayway refinery in Linden, NJ. 2002 is likely to result in lower profit margins for most PP producers, the report contin- ues, but the material’s diversity and a good supply of polymer grade propylene feedstocks will help it remain in a position of growth.
A separate study, by Chemical Market Associates, Inc (CMAI), on propylene supply also suggests that the supply of polymer and chemical grade propylene feedstock will grow at an average of 4.2% per annum for the next 15 years.
CMAI has also recently published data on the current demand and future growth for polystyrene. The consultancy estimated that demand for polystyrene fell 2.5% globally in 200 1. That equates to a global operating rate of just 75%, which CMAI claims is considerably lower than in previous economic slumps. The fall follows a continued imbalance between capacity and demand.
However, CMAI predicts a rise in demand for polystyrene in 2002, but forecasts an equal increase in capacity, continuing the reduction in operating rates.
Contact: Industrial Information Resources Inc, Houston, TX, USA; tel: +I-713-783-5147; URL: www.industrialinfoxom Chemical Market Associates, Inc, I1 757 Katy Freeway, Suite 750 Houston, TX 77079, USA; tel: +I-281-531-4660; fax: +I-281-531-9966; URL: www.cmaiglobal.com
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