LdPE
10 September 2001 00:00 [Source: ICB]
Growth in western Europe is steady as ldPE slowly loses
some market share to lldPE. Global demand is around
2.5%/year
Uses
Low density polyethylene (ldPE) is mainly used as a packaging
film, either on its own or blended with linear low density
polyethylene (lldPE) to improve mechanical properties. Film
applications account for about 50% of world demand. Blown ldPE film
has good processability and can be used in food and
medical/pharmaceutical packaging in high purity grades as well as
in agricultural film and disposable nappies. It is also used in
sheathing for electrical and communication cables, which takes 10%
of ldPE output, and in the extrusion coating of paper and board for
the packaging of liquids and in moisture barrier applications.
Supply/demand
Production in western Europe crept up to over 4.8m tonne last
year, according to the Association of Plastics Manufacturers in
Europe (APME). It rated domestic sales in 2000 at 4.2m tonne, and
sales outside the region at 549 000 tonne. Players say demand for
January-July is up by 1% over the same period last year. They
report improved sales in July/August following a slow May/June,
although an element of pre-buying ahead of price hikes is evident,
as well as customers replenishing an empty pipeline. Producers
expect a stronger second half and are predicting sales growth this
year of about 2% over 2000.
BP announced in late August the permanent closure of its Wilton,
UK, plant. Production will cease from October and a supply deal
with Basell will help meet contract commitments. More closures at
other similar small plants are expected. Basell's new 320 000
tonne/year plant at Aubette, France, finally started up in March,
delayed from its original onstream schedule of mid-2000.
Pricing
European prices have been on a downward trend from levels of
DM2-2.05/kg in May/June last year. Increases were achieved in March
through May as short supply and good demand supported better
numbers. Prices have slipped again in the last three months and
were reported in the range DM1.62-1.67/kg for August. Producers
believe prices have bottomed out and have announced a E100/tonne
rise from September in an attempt to boost poor margins.
Technology
Two basic processes are available: stirred autoclave or tubular
routes. The tubular reactor is gaining preference over the
autoclave route due to its higher ethylene conversion rates. The
reaction is carried out using a free radical initiator consisting
of one or two peroxides with or without oxygen. The processes can
generally be used to make copolymers with polar comonomers, ie EVA
polymer. The scale of tubular plants has risen to about 300 000
tonne/year and above. Capital costs are said to be competitive,
while the higher utility costs for ldPE are offset by no need for
comonomers.
Health and safety
LdPE is a translucent solid with a waxy surface, which is
resistant to weak acids and alkalis. Dust can irritate the eyes,
nose and throat. LdPE has low flammability but gives off smoke on
burning.
Outlook
West European growth is no more than 1%/year because of
declining market share to lldPE. Eastern Europe has higher growth
potential at 3-5%/year depending on the country. Global growth is
about 2.5%/year. Players say ldPE is becoming competitive again
because of the larger reactor size. They also believe the latest
metallocene lldPE grades will not be a major threat to standard
ldPE resins, as they command a price premium and will be used more
in enhanced applications.
Petkim will commission a 120 000 tonne/year plant in Aliaga,
Turkey, in 2004, by which time Russia's Gazprom also anticipates
starting a 300 000 tonne/year plant. DSM has plans for a 400 000
tonne/year unit at Geleen, the Netherlands, which it wants to
implement with a third party. Several other projects are proposed
or under way in Iran, China and Malaysia.
###10407###
EUROPEAN ldpe CAPACITY, '000 TONNE/YEAR
| Company |
Location |
Capacity |
| Arpechim |
Pitesti, Romania |
80 |
| Atofina |
Balan, France |
120 |
|
Carling, France |
230 |
|
Gonfreville, France |
160 |
|
Mont, France |
80 |
| Basell |
Aubette, France |
320 |
|
Carrington, UK |
170 |
|
Fos, France |
110 |
|
Wesseling, Germany |
430 |
| Borealis |
Porvoo, Finland |
190 |
|
Ronningen, Norway |
145 |
|
Schwechat, Austria |
240 |
|
Sines, Portugal |
140 |
|
Stenungsund, Sweden |
135 |
| BP1 |
Wilton, UK |
100 |
| Dow Chemical |
Leuna, Germany |
160 |
|
Tarragona, Spain |
95 |
|
Terneuzen, Netherlands |
265 |
| DSM |
Geleen, Netherlands |
565 |
| Erdölchemie2 |
Cologne, Germany |
350 |
| ExxonMobil |
Antwerp, Belgium |
265 |
|
Meerhout, Belgium |
400 |
| HIP Petrochemija |
Pancevo, Serbia |
45 |
| Lukoil-Neftochim |
Burgas, Bulgaria |
85 |
| Petkim |
Aliaga, Turkey |
180 |
|
Yarimca, Turkey |
30 |
| Petrobrazi |
Brazi, Romania |
90 |
| PKN |
Plock, Poland |
165 |
| Poli-Chem |
Blachownia, Poland |
20 |
| Polimeri doo Zagreb |
Krk, Croatia |
70 |
|
Zagreb, Croatia |
85 |
| Polimeri Europa |
Dunkirk, France |
185 |
|
Ferrara, Italy |
110 |
|
Gela, Italy |
215 |
|
Oberhausen, Germany |
120 |
|
Ragusa, Italy |
155 |
| Petromidia |
Midia, Romania |
60 |
| Repsol YPF |
Puertollano, Spain |
100 |
|
Tarragona, Spain |
130 |
| Slovnaft |
Bratislava, Slovakia |
180 |
| Speciality Polymers3 |
Antwerp, Belgium |
130 |
| TDESA4 |
Tarragona, Spain |
170 |
| TVK |
Tiszaujvaros, Hungary |
115 |
1 Plant to close Oct 2001
2 Owned 100% by BP
3 Borealis/DuPont 50:50 jv
4 Dow/Repsol jv
Source: ECN/CNI
ICIS Copyright © Reed Business Information 2009
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