17 August 2010 15:16 [Source: Chemical Report]
High density polyethylene (HDPE) is the largest of the three polyethylenes (PE) by volume of consumption. It has a very linear structure with only a few short side branches leading to a higher density range as well as a more crystalline structure. These properties give HDPE its higher strength compared to the other PEs, allowing a wider range of uses.
A major outlet for HDPE is in blow-moulding applications such as bottles for milk and other non-carbonated drinks, drums, fuel tanks for automobiles, toys and household goods. Because HDPE has good chemical resistance, it is used for packaging many household and industrial chemicals such as detergents, bleach and acids.
HDPE can be injection moulded into articles including crates, pallets, packaging containers and caps, household goods and toys. It can be extruded into pipes for water, natural gas and irrigation, corrugated pipe for drains and sewers, and conduit for electrical and telecommunication cables.
In Asia, over twice as much HDPE is consumed in film uses than in North America and ?xml:namespace>
A major thrust for HDPE has been into bimodal grades for high performance film, pressure pipe and to a lesser extent blow moulding applications. Pressure pipe producers can now pursue higher pressure ratings using HDPE bimodal grades.
The combination of better processability without the loss of mechanical strength in these bimodal resins permits downgauging, a reduction in product profile or thickness. For film, the same area of film can be made using less polymer, while for pressure pipes, thinner walls reduce raw material requirements and make the pipes more flexible.
Most commercial bimodal HDPE is produced in multiple reactor configurations which allow for optimal tailoring of the resin structure. However, the introduction of dual site catalysts that allow bimodal resin production from a single reactor may boost supply and lead to lower capital and production costs.
Markets recovering after significant downturn
Global HDPE markets had been growing steadily at around 5%/year. Eastern and Central Europe, South America, Asia Pacific, the Middle East and
However, this growth was abruptly halted by an unprecedented demand crash in the second half of 2008 as a result of the credit crisis and its impact on economic activity. With declining polymer prices exacerbated by falling feedstock prices, purchasers withdrew from the market and inventories along the value chain reduced significantly. This resulted in a fall in demand being far beyond that anticipated by the economic downturn.
In 2009, global HDPE demand saw a weak recovery with demand growing by 1.1% compared to 2008, according to the consultant Nexant ChemSystems. Much of the recovery was driven by strong growth in
HDPE will recover growth in the next few years as the industry restocks the inventory chain and the economic outlook improves. Growth in the 2009-2015 period is projected by ChemSystems to be a healthy 5.5%/year. Bimodal HDPE will continue to be the focus for much of this growth based on an expanding product performance envelope and the potential for single gas phase reactor production which would have lower capital and production costs.
While demand growth is expected to be heavily focussed in China, Western Europe and North America will also see growth, which although low in terms of growth rates, it will still be sizeable in terms of absolute demand increment.
Wave of new capacity expected
The addition of new HDPE capacity was limited in 2008, partly due to delays in new plants starting up. This will change as a wave of new capacity comes on stream in the 2009-2012 period. As this substantial capacity is scheduled to start up during a time of demand still recovering, the industry will come under immense pressure due to falling operating rates. Mature markets such as Western Europe and
This investment is focussed in regions with advantaged feedstock such as the Middle East or high growth rates such as Asia, in particular
A further 2.2m tonne/year of PE capacity is expected to be added in the
The estimated surplus available for export from the
There is concern that
Over the next few years, global trade patterns will evolve noticeably as the
Updated: July 2010. Source: ChemSystems PolyOlefins Planning Service (POPS).
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