28 November 2012 13:39 [Source: ICIS news]
DUBAI (ICIS)—Polyolefins in Turkey are expected to grow at 16-18% year on year in 2012, driven by the expanding domestic market and export opportunities, a senior executive of Socar Turkey said on Wednesday.
“Turkey is second to China in terms of demand growth,” Fatih Karakaya, commercial director of Socar Turkey said at the sidelines of the 7th Gulf Petrochemicals and Chemicals Association (GPCA) forum.
With 60% of the downstream plastics finished goods being exported, and the Turkish government targeting to reach a total export quantity of $500bn by 2023, consumption of polyethylene (PE) and polypropylene (PP) in the country will continue to multiply, Karakaya said.
Out of the $500bn worth of exports, one-tenth is on finished goods of chemical based products, he added.
“That is to say at least the chemical sector will have to grow at 14% year on year from now to 2023,” he said.
In 2012, it is estimated that the total exports will yield $150bn from five years ago’s level at $60bn, Karakaya said.
“There is huge potential here,” he said.
Out of the exported plastics finished goods in 2012, 40% is estimated to have gone to Europe, while the rest heads to Middle East, Africa, Russia, CIS countries and Iran.
“With the recent sanctions imposed on Iran, demand sourcing from Iran did decrease,” he said.
Turkey exports both LDPE film grades and finished goods to Iran, but since US-led sanctions have begun last September, quantities have dwindles, leading to minimal export quantity moving to Iran, he added.
Also, the fear of recession in the Eurozone is another bearish factor, which will hit the demand for finished goods from Turkey, and indirectly polyolefins, he said.
“We have no idea how demand will be next year, given Europe’s uncertain status,” he added.
Despite the weakening export demand, the domestic demand in Turkey is likely to stay rosy. “We have a ready population to consume the finished goods,” he said.
The huge converting sector further supports the domestic demand.
For instance in Antep, close to Syria, there is 900,000 tonnes/year of polypropylene (PP) converting capacity.
“There is no single city in the world that has such huge converting capacity,” Karakaya said.
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
Asian Chemical Connections