Rise in Mideast exports to alter PE trade patterns – DeWitt

24 March 2010 21:08  [Source: ICIS news]

HOUSTON (ICIS news)--Substantial changes will be seen in global polyethylene (PE) trade patterns as Middle East exports increase by 2m-3m tonnes, consulting firm DeWitt said on Wednesday.

Earl Armstrong, managing director of Houston-based DeWitt, said that around 7m tonnes/year of capacity for ethylene and its derivatives will come on-stream in Asia and the Middle East in the 12 months to mid-2010.

But imports into China are likely to remain the same as the last year or two as new domestic production capacity meets its growth needs, Armstrong told DeWitt’s World Petrochemical Conference in Houston.

DeWitt’s assumptions are based on a gross domestic product (GDP) annual growth rate in China of 8-9%.

China's imports could increase by another 1m tonnes if GDP growth is higher or more consumer spending in China means polymer demand growth outpaces the rise in GDP.

Armstrong expects more PE to be sent to Europe, but the Middle East volumes will increase more gradually.

He also predicted ethylene cargoes related to start-ups would emerge first, ahead of the initial cargoes of polyethylene.

Price pressure is likely to start in Asia, initially with high density polyethylene followed by linear low density polyethylene, he said.

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By: Peter Taffe
+44 20 8652 3214

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