NPE ’06: Basell plans for global polyolefins shifts

20 June 2006 20:46  [Source: ICIS news]

CHICAGO (ICIS news)--Inter-regional movement of polyolefins will increase significantly within four years as feedstock-rich nations work to meet consumer demand in emerging economies, Basell president Volker Trautz said on Tuesday.

 

In what he termed the preamble to coming trends in the global polyolefins market, Trautz cited maturing markets and limited growth potential in today’s wealthy nations, the lack of feedstock in populous emerging markets and a dearth of consumer markets in feedstock-rich regions.

 

Along with those three fundamental features of the market going forward, Trautz identified seven other “new realities in the polyolefin world,” including the emergence of new industry players as prominent industry shareholders and the shift of production leadership from mature markets to low-cost feedstock regions.

 

In addition, he said, “Cash cost leadership is in the feedstock-owning nations [and] market leadership - including production of finished goods - is shifting from mature markets to China.”

 

He cautioned that China might not exhibit continuing demand growth for polyolefin imports.  “China’s domestic capacity will grow in line with its domestic demand,” he said, “and exports to China may be as big as they will get.”

 

In India, he said expectations for demand growth are high but the rate of that growth and its consistency are not certain.

 

Lastly, Trautz predicted that high-cost producers in 2010 likely will have surplus product on their hands and facing a tough sell in the global market.

 

He said Basell is positioned to profit from the expected inter-regional shifts with cost efficiencies in operations and access to advantaged feedstock in the Middle East and with developing feedstock opportunities in Kazakhstan and North Africa.

 

Trautz spoke to an audience at the NPE international plastics exhibition.  Sponsored by the Society of the Plastics Industry, the exhibition concludes on Friday.

By: Joe Kamalick
+1 713 525 2653

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