european propylene and polypropylene (epca 2012 presentation)
DESCRIPTION
Read the European propylene and polypropylene presentation given at EPCA 2012. This presentation talks about a rollercoaster ride for the industry; the issues and challenges ; opportunities and what shale gas means to the European propylene industry.TRANSCRIPT
European Propylene and Polypropylene Monicca Egoy
Editor, Europe Propylene & Polypropylene
2
Agenda
• 2012 price trends: A rollercoaster ride for the industry
• Issues and challenges
• Opportunities
• What shale gas means to the European propylene industry?
NWE propylene and naphtha prices
Source: Platts On The Net
European propylene and polypropylene prices
Source: Platts On The Net
European propylene production 2005-2011
Source : APPE
NWE propylene quarterly production 2007-2012
Source: APPE
European polypropylene contract, spot prices
Source: Platts On The Net
Inherent features of European propylene market: The incredible balancing act
• Credible revival of downstream demand yet to materialize
• Tight control of working capital
• Cautious inventory management
• Utilization rates adjusted based on downstream demand
• Self-sufficiency, self-preservation mode at all times
• Industry remains vigilant
Global propylene demand 2010-2016
Source: Japan METI
0 20,000 40,000 60,000 80,000 100,000 120,000
2010
2011
2012
2013
2014
2015
2016
US Western Europe, includng Turkey Total Asia TOTAL DEMAND
Global polypropylene demand 2010-2016
Source: Japan METI
0 10000 20000 30000 40000 50000 60000 70000
2010
2011
2012
2013
2014
2015
2016
US Western Europe, includng Turkey Total Asia TOTAL PP Demand
Global propylene production 2010-2016
Source: Japan METI
0 20,000 40,000 60,000 80,000 100,000 120,000
2010
2011
2012
2013
2014
2015
2016
US Western Europe, includng Turkey Total Asia TOTAL PRODUCTION
European polypropylene production/demand 2010-2016
Source: Japan METI
7,500
8,000
8,500
9,000
9,500
10,000
10,500
2010 2011 2012 2013 2014 2015 2016
production Demand
• Europe’s diversified cracker portfolio to benefit in times of global C3
shortages, as new US investments favour C2 production
• Europe to capitalize on robustness in C3 production chains
• Nimble infrastructure in Europe to aid arbitrage opportunities
• Strength of feedstock/downstream integration to aid efficiency
• Close proximity to customers to continue strengthening integration on a
larger scale
Opportunities: What Europe will capitalize on
Summary
14
•Volatile feedstock to remain a key feature, margins weak
•End-user markets fragile
•Production rates adjusted based on demand
•Long term outlook positive
•Shale gas brings opportunities for European propylene industry
