Global PP capacity expands in the wake of strong demand

A good balance of properties combined with its ability to be customized to fit a wide range of wide range of production processes and applications make PP as material of choice for many products. it is suitable as packaging material for foodstuffs and goods, as well as for countless other products such as household items, clothing, and vehicles. 

 

Thus, Ceresana reported that global demand for PP totaled 55.1 million tons in 2013. Even with some setbacks in the global market, PP revenues will continue to pick up and rise by 5.8% annually until 2021, according to Ceresana forecast. 

 

The opening up of new application areas, the development of biobased types of PP and replacement of other materials continue to offer high growth potential for the PP market. Also, the global maket share of Western European PP producers is expected to fall from 13.9% to 11.4% in the next few years due to the only moderate increase of demand in the largest national markets, like in Germany, Italy, and France. On the other hand, the report expects Eastern Europe to post strong growth. 

 

The USA as the world's largest consumer of rigid plastic packaging is reporting a recent increase of demand for PP again. China and India continue to see a massive increase of demand, which is why Asia-Pacific is expected to account for about 58% of total global demand in 2021.

 

Expansion in the production capacities for PP feedstock propylene  will ensure steady supply in the future. China will increase the use of alternative technologies to produce propylene (mainly PDH plants and CTO technology). As a result, a number of new PP plants will be constructed. A detailed analysis of production capacities in each country and of each company paints a conclusive picture of future growth regions. The region Asia-Pacific already accounts for almost half of the total global capacity and is likely to increase capacities by another 40% in the next eight years. Other important plants will be constructed in the countries of Eastern Europe and the Middle East with the Middle East seen as being a net exporter to meet rising global demand. Also, as a result of these projects, moderate increase in PP prices is anticipated. 

 

Should all scheduled PP projects be realized, the Middle East in particular will considerably increase net exports and satisfy the rising global demand.