09 May 2013 10:34 [Source: ICIS news]
By Joseph Chang
TAIPEI (ICIS)--The Asia polyolefins market will shift both in terms of growth rate and in the nature of product demand, the chief executive of Borouge's sales and marketing arm said on Thursday.
"We see polyolefins demand growth in Asia and the Middle East at around 6-7% in 2013 - not booming versus a few years ago but still healthy versus the rest of the world," said Wim Roels, CEO of Borouge Pte.
Roels spoke to ICIS on the sidelines of the Asia Petrochemical Conference (APIC) in Taiwan.
"China is seeing a maturing of demand. We're now seeing a different style of business - not explosive growth but a more mature, controlled growth," he added.
The polyolefins market in China is also shifting from an emphasis on volume to one on quality, and from export oriented consumption to internal consumption, the CEO noted.
"China exports of manufactured goods will slow but this will be compensated by more growth in domestic consumption," said Roels.
A major driver of China polyolefins demand growth is a continuing migration of the population into mega cities.
"Growing cities require pipes for water, sanitation and gas, as well as wire and cable for power. Also, food packaging becomes more important in cities as more food is bought from supermarkets," said Roels.
China government infrastructure spending is also an important driver of polyolefins demand.
"We expect infrastructure spending in China to pick up with the new government in place, with a shift from east to west China," Roels said.
Borouge is exploring logistics solutions to cater to this trend, he added.
The start-up of the highly anticipated Borouge 3 project in Ruwais, Abu Dhabi in early 2014 is expected to raise the company's olefins and polyolefins capacity by 2.5m tonnes/year.
Abu Dhabi-based Borouge is aiming to export polyolefins primarily to Asia, with a geographic spread across China, Japan, Indonesia, Vietnam, Thailand, Australia and New Zealand.
It also plans "significant" exports to Europe and is already sending small quantities there and to Turkey to test the market and prepare for volumes from Borouge 3, said Roels.
APIC runs from 9-10 May.
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