CMAI Completes 2009 World Polyolefins Analysis

Chemical Market Associates, Inc. (CMAI) announces the completion of the 2009 World Polyolefins Analysis. This market study provides clients with a historical perspective and insight into the forecast of supply and demand dynamics, production capacity, trade patterns, pricing relationships, profitability, production economics and technology for global polyolefin markets for the period 2003 to 2013. A historical perspective of these issues is also provided.

The recent volatility in the global economies, and the dramatic fluctuations in energy prices have had a significant impact on the petrochemical value chain. These uncertainties make this analysis a necessary resource for business planning professionals and strategic decision makers. Some of the major industry issues examined in the analysis are:

The Middle East and China continue with major capacity expansions; impacting prices, producer margins and global operating rates.

Between 2008 and 2009, world polyethylene supply/demand balances will begin to transition as investments in new capacity from the Middle East & China in recent years begin to impact the market. Prices, which have recently been at historical highs, have had a positive effect on producer margins, with most of the energy-based cost increases being passed through to resin buyers. The next wave of new capacity expected to come on-stream in the Middle East and Asia between 2009 and 2012 will create global oversupply conditions. This will drive producer margins back down to historical norms and eventually below re-investment levels. The impact on margins will be evident as early as 2009.

Regional production economics will vary significantly and thereby influence operating rates, trade flows and producer margins.

Toward the end of the five year forecast period, significant increases in polyolefins exports are expected in the Middle East, following the proliferation of capacity in the region. Iran will become a player in the global polyethylene market as their new capacity comes online between 2009 and 2011. Prices are expected to subside from the historical highs experienced in 2008. This will cause global trade patterns to shift depending on regional demand and local production economics as resin flows out of the region to Asia and West Europe (and ultimately, the Americas).

Plastic finished goods will continue to flow out of Northeast Asia, primarily from China, destined for the U.S., Europe and Japan. Fabricators and converters in the receiving regions will be under competitive pressure for domestic market share. Other developing economies, including those of India, the Middle East, Central Europe and Russia, will participate in the finished goods trade in years to come. The Middle East has begun to actively seek investors from the converter ranks to build facilities in the region to produce finished products for export.

CMAI’s 2009 World Polyolefins Analysis comprises eleven years (2003-2013) of study: five years of history, the current year, and five years of forecast and is available in book and CD-ROM format, with access to CMAI’s Online Capacity and Supply/Demand databases. With updates to the Capacity database as changes in the market place occur and two annual updates to the Supply/Demand database, clients find these necessary tools for their strategic business decisions.

CMAI is a chemical, plastics, fibers and chlor-alkali consulting firm that services a wide range of companies all over the world. Since 1979, CMAI’s goal has been to provide accurate, timely consulting services for the worldwide industries that it covers. CMAI maintains offices in Houston, New York, London, Dubai, Dusseldorf, Singapore and Shanghai. Clients to CMAI services include chemical and oil companies, engineering & construction companies, banking and financial institutions, plastic converters, grocers/retailers, government agencies and trading companies.

Contact: Anne Geraci 1-281-531-4660. Source: Chemical Market Associates, Inc.