By Malini Hariharan
Despite challenging market conditions in 2011, the global polymers industry managed to post demand growth of 4.5%, with the largest increase recorded by polyvinyl chloride (PVC) at 6.2% and linear-low density polyethylene (LLDPE) at 5.8%, estimates Fabrizio Galie of the ICIS consulting team.
Global demand for commodity polymers, including PE, polypropylene (PP), PVC, polystrene (PS), but excluding expandable PS (EPS), was 178m tonnes last year with China accounting for 27% of this number.
But demand growth in the country was substantially lower at 5.6%, down from the 11% recorded in 2010, as tight credit availability and the overall economic slowdown dampened consumption.
Other Asian countries, such as India, also posted weak performances. As highlighted by the blog earlier, high interest rates and a slowdown in industrial production affected demand. And the scenario has yet to change so far this year.
The surge in crude oil prices and the start-up of new capacities is likely to put further pressure on the market this year, and it will take time for the situation to stabilise, adds Galie.
"The outlook for commodity polymers in 2012 is one of prolonged volatility as much will depend on the global macroeconomic environment," he says.
Assuming a quick economic recovery, global polymer consumption is estimated to reach 214m tonnes by 2015 with PE being the main contributor.
And China will continue to be a large importer even as it brings onstream new plants, he believes.
