Iran sanctions lift will not have major impact on Turkey PE, PP market

ISTANBUL (ICIS)–Whether or not the current easing of sanctions on Iran is extended past 24 November, the Turkish polypropylene (PP) and polyethylene (PE) market will not see a major impact either way, a panellist taking part in a discussion said at the ICIS Turkish Polymers Conference late on Monday.

“It is very difficult to predict if sanctions will be lifted,” said Emin Imanov of Bayegan “I cannot comment if [sanctions] be lifted or not, but if it is or not, I do not expect too much change in market,” he added.

Imanov highlighted that Iranian domestic demand for plastics continues to grow, highlighted by the fact the country is not currently exporting ethylene, suggesting it was being used up in domestic production.

Panellist Cem Doganca of Tricon Energy said: “We are not expecting to see Turkey drowned in Iranian product as Iran has lots of other options [for exports].”

Iranian material may flow to other markets, such as South America, though Doganca pointed out that China may not continue to take as much Iranian material as it had been previously.

“China won’t need as much Iranian material as they are already [started] decreasing purchases from South Korea”, he said.

Throughout the first day of the conference, there was a feeling from some attendees that Iran will be a significant trading partner for both Turkey and other countries once sanctions are lifted, with some delegates speaking almost as if the continued easing of sanctions was a given.

Overall, though, the panel’s sentiment was such that Turkey is in no danger of a flood of Iranian material entering the country in the immediate future.

“Whether the sanctions are lifted earlier or later, it’ll take time for projects of this scale to materialise”, Wim Van Asch of AT Kearney said, speaking on the panel.

Van Asch was referring to a presentation given earlier in the day by Dr SM Hosseini of Matco International, who had said Iranian polymers producers are looking to secure a third of the Turkish plastics market with Iran’s current programme which aims to bring around 60m tonnes of polymer production capacity online.

The first ICIS PLASFED Turkish Polymers Conference runs from 27-28 October in Istanbul.