13 December 2011 16:43 [Source: ICIS news]
DUBAI (ICIS)--China's petrochemicals demand will continue to outstrip domestic supply through to 2015 on the back of strong economic growth and a slowdown in new capacity additions, an industry analyst said on Tuesday.
Chinese demand for petrochemicals is estimated at around 110m tonnes in 2011 and is expected to grow to around 160m tonnes by 2016, said Paul Pang, managing director of chemicals consultancy Chemical Market Associates Inc (CMAI) Shanghai.
Pang was speaking at the sixth GPCA Forum, which is being held in Dubai on 13-15 December with the theme ‘Moving Downstream – Creating Value and Sustainable Growth’.
Domestic supply is expected to grow from about 70m tonnes in 2011 to around 110m tonnes in 2016, according to Pang.
Demand for petrochemicals will continue growing at a high rate through to 2015, but will grow at a slower rate than the levels seen in 2006-2010 as the economy cools, according to Pang.
China’s economy is expected to grow at an average of about 8% through to 2015, as compared with the high growth rate of around 10% seen in 2006-2010, he said.
The gap between demand and domestic supply will continue to drive Chinese demand for petrochemicals from abroad, according to Pang.
“China is driving global petrochemical demand… globally we consumed 314m tonnes of petrochemicals in 2010,” he said.
China accounted for about 32% of total petrochemicals demand globally in 2010, Pang said.
This compares to 273m tonnes, or about 24%, of overall global demand for petrochemicals in 2006, according to Pang.
Demand for petrochemicals in China is driven by large government spending on infrastructure, increasing domestic personal spending, housing construction and strong exports, he said.
On the supply side, China is set to see a wave of new coal-to-chemical projects coming on stream by 2016, according to Pang.
An estimated 5.75m tonnes/year of coal-based ethylene capacity and 2.2m tonnes/year of coal-based paraxylene (PX) capacity is set to start up in 2015-2016, he said.
In 2009, China’s coal reserves stood at 319bn tonnes, according to Pang.
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