Europe olefins industry faces dual threat - expert

22 May 2007 11:18  [Source: ICIS news]

ANTWERP (ICIS news)--The European olefins industry will face the twin threats of increased derivative imports and the loss of its export market as increased output from the Middle East floods the region, said an expert from the Nexant consultancy group on Tuesday.
 
Western Europe was expected to become a net importer of polypropylene (PP) in 2009 and by 2010 would import about 800,000 tonnes/year, said vice president of Nexant ChemSystems Richard Sleep at the fourth World Olefins Conference in Antwerp, Belgium.
 
During a recent peak in 2005, the domestic European market exported over 1m tonnes of PP.
 
Imports of ethylene derivatives were expected to surge in 2009/2010 as huge polyolefins complexes go on stream in the Middle East, Sleep said.
 
From the 400,000 tonnes of imports expected in 2007, Sleep predicted European imports of ethylene derivatives would total abount 1.7m tonnes in 2010.

Meanwhile, 48% of European consumption growth in high density polyethylene (HDPE) was likely to come from imports, 55% in linear low density polyethylene (LLDPE) and 155% in monoethylene glycol (MEG), Sleep said.
 
“There is minimal investment in west European olefin derivative assets,” said Sleep, highlighting the cancellation of the European propylene pipeline and Saudi Basic Industries Corp’s proposed complex being put on hold.
 
“Therefore, Europe has to accept imports of commodity olefin derivatives at a lower cost,” said Sleep. “But the market remains strong enough to support and require European production.”

By: Mark Watts
+44 20 8652 3214

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