17 May 2012 17:29 [Source: ICIS news]
KUALA LUMPUR (ICIS)--Recent acrylic acid and esters capacity additions in China have exceeded demand growth, creating a long market, an analyst said on Thursday.
“There has been a lot of consolidation in recent years by global producers, but now Chinese capacity additions exceed demand growth,” said Keiji Wakatsuiki of Tecnon Orbichem.
He was speaking at the 34th annual Asia Petrochemical Industry Conference (APIC), held in Kuala Lumpur, Malaysia.
Double-digit production growth of around 14% in China is expected for the next several years. However, consumption growth will be moderate at around 6% so the supply/demand gap will expand rapidly, Wakatsuiki said.
Wakatsuiki added that the cheap natural gas feedstock in the US as a result of shale gas was also a potential factor for more investment in the US.
The largest end uses for acrylic acid and its esters are in super absorbent polymers (SAP) and paints and coatings.
SAP demand growth remains strong, particularly in the developing world. However, demand from the paints and coatings sector is weak to modest because of the ongoing downturn of the construction industry.
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