Central Europe EPS/XPS expansions will go ahead

14 November 2007 16:53  [Source: ICIS news]

By Barbara Ortner

ANTWERP (ICIS news)--Expansion projects for EPS and XPS in central Europe will go ahead despite the current EPS slump, said a major central European producer on Wednesday.

“The fortunes of EPS [expandable polystyrene] have turned around somewhat this year,” said Sim Elman, head of synthetic rubber, latex and monomer business at Synthos, the newly merged styrene derivatives business of Dwory and Kaucuk.

The dramatic decline in the fortunes of EPS had not been predicted, as could be seen from the number of companies now investing in new capacity (Sunpor, NOVA Innovene, Polimeri Europa, BASF), he said at the 6th European Aromatics and Derivatives Conference.

There were three reasons for the sudden drop in demand in the second half of 2007: the mild winter of 2006-2007 which kept the building trade working throughout the winter months and resulted in a quiet summer; the lack of available labour in the CEE (central and eastern Europe); and the arrival of 20,000-30,000 tonnes of Chinese imports.

Despite the current downturn, Synthos was still committed to its expansion plans - debottlenecking from 150,000 tonnes/year EPS to 210,000 tonnes/year by 2009 - because strong demand growth was expected in the CEE, chiefly from projects to insulate aging apartment blocks in a high-cost energy environment.

Similarly, demand for XPS (extruded polystyrene) in CEE was seeing double-digit growth, and Synthos was committed to its plans for new XPS lines at Dwory in Poland, starting up in spring 2008, and Kralupy in the Czech Republic, starting up in spring 2009.

However, it was in SBR (styrene butadiene rubber) that Synthos saw the greatest potential for growth.

“There’s been such incredible growth in SBR in central Europe with greenfield tyre plants springing up for all the majors. The region is second only to China in global importance for tyre production,” he said.

Of the eight European SBR producers, the new Synthos had the largest capacity but it was doubtful whether all the other plants were being run at rates near their nameplate capacity, he added.

The 6th European Aromatics and Derivatives Conference, organised by ICIS and International e-Chem, is taking place on 14-15 November in Antwerp, Belgium.

By: Barbara Ortner
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