INTERVIEW: North America PP demand to remain solid even with some buyer hesitation – Braskem exec

COLORADO SPRINGS (ICIS)–North American polypropylene (PP) demand is expected to continue to be solid in 2022 after a very strong 2021 even with some consumer markets softening, the CEO of Braskem America said on Monday.

“After a strong year for PP as we had in 2021 with 7-8% growth, typically the next year is flat. But in 2022, demand continues to be healthy and we see solid demand extending into the summer,” said Mark Nikolich, CEO of Braskem America, in an interview with ICIS.

Nikolich spoke to ICIS on the sidelines of the American Chemistry Council (ACC) annual meeting in Colorado Springs, Colorado, US.

“The big question is: Is inflation going to disrupt this? It is starting to have an impact, as we are seeing signs of hesitancy in consumer markets. But this is off a base of tight inventories which we expect for much of the year,” he said, while also noting there could be some easing later in the year when North American supply is expected to improve.

On the consumer and packaging side, there is enough supply along with some concerns over inflation’s impact on demand. However, on the automotive side, there continues to be pent-up demand from the semiconductor-induced shortages and not enough material, he noted.

“While other markets might soften, we expect automotive to be solid this year and into next year. We have already seen small improvements in PP demand and it will depend on how much the OEMs [original equipment manufacturers] can absorb,” said Nikolich.

Meanwhile, PP imports into North America have been a challenge with continuing supply chain and logistics disruptions, he noted.

“It hasn’t been as easy to get polymer into North America to satisfy base demand. It is very difficult for a long region to disrupt a short region, as customers have to believe it can be delivered when it’s needed,” said Nikolich.

The ACC annual meeting runs through Wednesday.

Interview article by Joseph Chang