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New Analysis: Market Analytics Polyolefins - 2020

Nexant Energy and Chemicals Advisory announces publication of a new report focused on the global polyolefins industry – Market Analytics: Polyolefins - 2020.  This report provides an in-depth analysis of the polyolefins industry including:

Following the slowdown in global economic growth in 2018 and 2019, the global economy has plunged into a contraction of unprecedented severity as a result of the COVID-19 pandemic.  The situation remains volatile, and global infection rates continue to climb.  In June 2020, the IMF revised its economic projections for 2020 and 2021 for the second time this year as the COVID-19 pandemic has had a more negative impact on activity in the first half of 2020 than anticipated and the recovery is projected to be more gradual than previously forecast.

The downturn in the automotive sector is exacerbated by the COVID-19 crisis.  Construction activity has also declined.  However, resilience of the polyolefins business has been demonstrated by its use in consumer and medical packaging, as well as personal protective equipment (PPE) that are essential to the pandemic response.  The global polyolefins market is expected to contract by one percent in 2020, less severe than the GDP outlook.

Growth for polyolefins demand continued to slow in 2019 globally. However, Chinese demand remained strong in 2019, representing a growth of nearly 7 percent over 2018, contributing close to 82 percent of total global polyolefins consumption growth.  Imports from the United States to China fell by above 60 percent in 2019 as a result of the retaliatory duties imposed by China on polypropylene, HDPE and LLDPE, which had generated export opportunities for other regions such as Middle East, Eastern Europe and other Asian countries.  However, LDPE was excluded and imports from the United States increased by around 80 percent in 2019.  From December 2019, certain grades were excluded from the imposed duties due to availability, i.e. metallocene HDPE, C8-LLDPE and impact copolymer polypropylene.  In February 2020, China announced that importers could submit exclusion applications for all LLDPE, HDPE and polypropylene from March 2020, and therefore the import level from United States may increase.

Asia Pacific remains the growth engine of the global polyolefins market, with China leading the pack.  Growth in India and South-East Asia particularly Vietnam has been substantial in percentage terms, due to the relocation of polyolefins converters from China and own development of downstream manufacturing.  The region calls for polyolefins capacity development and the scale of capacity development in China and to a lesser extent, South Korea, India and South-East Asia in the medium term is far beyond forecasts for consumption growth.  However, the region is expected to remain in considerable production deficit.

For more information, click here to download the Report Table of Contents

NexantECA’s Markets and Profitability program provides accurate data, insightful analysis and dependable forecasts of the profitability, competitive position and supply/demand trends for over 60 petroleum, gas, petrochemical, polymers, chemical intermediates and fertilizer products.