InterviewBayer MaterialScience faces PC demand growth in Asia

20 April 2010 12:20  [Source: ICIS news]

By Prema Viswanathan

SHANGHAI (ICIS news)--Having enough polycarbonate supply available quickly to cope with the strong demand growth in countries like China will be a challenge for the industry, a senior official with Bayer MaterialScience said on Tuesday.

“We are just coming out of the biggest and most severe financial crisis, and we are now seeing a surge in demand for polycarbonate in China and some other Asian countries,” said Rainer Rettig, senior vice president of Bayer MaterialScience’s polycarbonates division.

He was speaking on the sidelines of the Chinaplas exhibition in Shanghai, China, which runs  from 19-22 April.

“This massive demand growth is a challenge for us in the industry, as several plants or lines were idled or mothballed during the crisis and many are slowly trying to bring back capacity online,” said Rettig.

Global demand growth for polycarbonate in 2010 is estimated at 6%, Rettig said.

“Some minor rumbles are still being heard in the NAFTA (North American Free Trade Agreement) region and in Europe, but Asia has come out of the crisis first, with China and some other Asian countries well on the growth track,” he said.

Chinese demand for polycarbonate was expected to show double-digit growth this year, largely due to the bullish trend in the automotive, IT and consumer-electronics segments, said Rettig.

“Asia represents two-thirds of global polycarbonate consumption, and 50% is in China. China is also a major production base, and some other Asian countries such as Japan, South Korea and Taiwan are also supporting this growth in China,” he added.

The strong demand growth, even while it has created some supply concerns, was seen as a welcome trend by Bayer, and vindicated the company’s decision to make investments in China and the Asia-Pacific region, said Rettig.

As long as oil and feedstock prices remain high, polycarbonate prices would follow the same trend, said Rettig.

“We have seen bisphenol A (BPA) prices rising sharply in recent months, and have been forced to pull up polycarbonate prices to manage our margins,” he said.

As long as there was adequate demand, and a perception that economic growth was strong, the price increases would be accepted by the market, he added. “But if there is a dip in demand, then prices of all petrochemicals will drop, and polycarbonate would be no exception.”

Substitution of conventional materials, such as metal and glass, with lightweight, ecologically sustainable and energy-efficient polycarbonate has been a major demand growth driver, said Rettig.

Concerns over the alleged health hazards in the use of polycarbonate in baby bottles have no scientific basis, said Rettig.

“All scientific evidence shows that polycarbonate products are safe, even in food applications.”

For more on Bayer MaterialScience visit ICIS company intelligence
Read John Richardson and Malini Hariharan’s Asian Chemical Connections blog
To discuss issues facing the chemical industry visit ICIS connect

By: Prema Viswanathan
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