India petrochemical demand may soon return to pre-pandemic levels – CPMA
MUMBAI (ICIS)–India’s petrochemical demand should be able to return to pre-pandemic levels in the current fiscal year ending March 2022, an industry group executive said, citing moderate impact of the previous year’s sharp economic slowdown to the sector.
“Owing to end-market diversity and exposure to more resilient sectors, the impact of an economic recession on petrochemicals was moderate in the last one year as compared with other industries,” said Mahinder Singh, secretary general of India’s Chemicals and Petrochemicals Manufacturers’ Association (CPMA) told ICIS on Monday.
In the previous fiscal year ending March 2021, major commodity polymers – polypropylene (PP) and polyethylene (PE) – have performed well, he said.
“Demand (for PP and PE) remained at the same level as that in 2019-20,” Singh said.
“However, the demand for fibre intermediates got affected by around 20%, which has been rebounding to 2019 levels in the current financial year,” he said.
In late April and early May, at the height of the second wave of COVID-19 infections in India, run rates across most Indian polyester producers had dropped by nearly 30% to around 50%, according to media reports.
At the time, various forms of lockdowns had been in place across different states to stem the deadly contagion.
“After a brief pause in April-May this year, petrochemical demand has resumed its upward trend in June 2021 and petrochemical capacity is likely to be revived in the near future,” Singh said.
Recent spikes in fuel prices, however, has pushed up the cost of transportation from manufacturers to downstream players, Singh said.
Auto fuel prices in India have been surging since May and have now crossed a record high of Indian rupees (Rs) 100/litre ($1.34/litre) across the country.
CPMA is the apex forum in the country representing the Indian chemicals and petrochemicals industry.
Focus article by Priya Jestin
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