09 November 1998 00:00 [Source: ICB]
Although PET demand is rising steadily, it is failing to
keep pace with the increasing world capacity buildup
Polyethylene terephthalate (PET) is a downstream product of
polyester and can be made into either resin or film. Of the two the
highest growth trend is seen in resins for the packaging industry,
being driven by switches from glass, aluminium and PVC.
End product usage of PET resins are dominated by blow-moulded
soft drinks bottles, estimated to have an 83% share of the west
European PET resin sector. Blow-moulded custom bottles have a 5%
share of this market, with extruded film and trays making up
European PET bottle resin production capacity is currently
placed at 1.6m tonne/year with 1998 demand estimated to be 1.3m
tonne/year and growing to 2.5m tonne/year in 2003, according to
Tecnon Consulting. Global PET packaging demand sits at 4.6m
tonne/year and will grow to 9.2m tonne/year by 2003. Worldwide
demand has continued to grow at 10-15%/year while capacity has
grown at 25-30% in the past five years.
Eastman's 130 000 tonne/year plant at Rotterdam came onstream
earlier this year. Hoechst-Trevira's PET resin business was sold to
the Koch-Saba group and is now KoSa (ECN 27 April 1998). New capacity
is due to come onstream in 1999 when Dow-BSL brings on its 145 000
tonne/year in Schkopau plant in eastern Germany. Brilen will also
expand its 25 000 tonne/year site in Spain to 85 000 tonne/year by
DuPont completed the acquisition of ICI's PTA/PET operations in
mid-1997. Little capacity has been announced worldwide beyond 2000
due to current weak market conditions.
Purified terephthalic acid (PTA) and monoethylene glycol (MEG)
are reacted to make a basic ester which is polymerised in a melt
phase, polycondensation finishing reactor operating under heat and
vacuum. The molten polymer is extruded, cut into chips and
The chips pass to a solid state polycondensation unit which can
be considered an annealing process to form the resin. Developments
include new catalysts to reduce esterification time. Researchers
are also looking for ways to remove the solid state
polycondensation stage. For example, DuPont is working on a flash
crystallisation process after the finisher.
After a period of strong demand growth and exceptional margins
in the early 1990s, PET bottle resins prices weakened in 1996 and
1997. The current competitive environment is defined by the
increasing world overcapacity along the whole polyester chain. The
Asian turmoil hit nearly all Asian markets from July 1997. Many
Asian exporters are operating at survival levels in order to meet
dollar debt repayments, pushing exports into all world markets and
in particular into the US and Europe.
Increased low cost Asian imports have been the driving force
behind falling European PET resin prices throughout the year. Asian
imports to Europe, historically at 15-20%, are anticipated to climb
to 40% by the end of the year, while US imports have fallen.
Current Asian spot prices are being quoted at DM1.2-1.4/kg, while
European material has fallen dramatically in October with
DM1.4-1.5/kg a 25 pfennig drop since mid-September.
EUROPEAN pet capacity, '000 tonne/year
|Catalana de Polimers
||El Prat de Llobregat
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