Current PE market situation and production capacity outlook · Current PE market situation and...

PTT Polymer Marketing Company Limited

Current PE market situation and

production capacity outlook

1

20 April 2017

Proprietary information of PTT Polymer Marketing Co., Ltd.

https://www.pttpm-techinfo.com/default.aspx

https://www.pttpm-techinfo.com/forgotpassword.aspx

2

PTT Group Value Chain

The biggest integrated petrochemical and refining complex in Thailand

Exploration &

Production

Crude Oil

Procurement

Olefins & Aromatic

Plants

Palm Plantation

Coal Mining

Pipeline

Trading

Petrochemical

Intermediate Plants

Biodiesel, Ethanol

Plants

Gas Separation

Plants

Logistics

Refineries

Power Plants

Industry

NGV

Oil

LPG

Lube Base Plant

Plastic Resins

Electricity

District Cooling

System

PTT Stations

Transportation

Household

Lubricant

End Product

Export Market

Gasohol (E10/E20/E85)

Biodiesel

PTTEP PTTNGD, TTTLNG

Thai Oil,

PTTGC,

SPRC,

BCP

PTTIT

PTTUT, CHPP

PTTRB

TLBC, IRPC

PTT tank

IRPC

HMC

PTTAsahi, PTTGC

IRPC, PPCL

PTTGC, IRPC,

TPX,

PTTGE

PTTGC, Thai Oil, BCP PTTIT

Upstream Intermediate Downstream End customers

Ga

s C

ha

in

Oil

Ch

ain

P

etr

och

em

ica

l

Ch

ain

N

ew

Bu

sin

ess


Manufacturing Unit

Sales & Marketing Arm

Logistics Provider

PTT Group Value Chain Fully Integrated Polymer Business Chain

3 Proprietary information of PTT Polymer Marketing Co., Ltd.

http://www.pttgcgroup.com/index.php

2005 2015

HDPE HDPE HDPE HDPE HDPE HDPE

PP PP PP PP PP

PS PS PS PS PS

LLDPE LLDPE LLDPE LLDPE

LDPE LDPE LDPE LDPE

ABS ABS ABS

PLA

PBS

PLA

PBS

PLA

PBS

PC PC

PMMA PMMA

PET

HDPE

PP

PS

LLDPE

LDPE

ABS

PLA

PBS

PC

PMMA

PET

2007 2008 2009 2010 2012

Purging Compound

PTTPM Product Portfolio Continuously Grow to service more customers

4 2016

PVC

HDPE

PP

PS

LLDPE

LDPE

ABS

PLA

PBS

PC

PMMA

PET

Purging Compound

PVC

Lubricant

LLDPE 400KT

LDPE 300KT

HDPE 800KT

- 5 -

EXPORT MORE THAN 100 COUNTRIES


+LLDPE 400KT

https://www.youtube.com/watch?list=UUswBgZlqaI3eoAz9Novygig&v=FMAg5g25FxM

6

AGENDA

Consumer trends affecting the polymer sector

Market review and global outlook for PE

New supply and the influence on market and trading dynamics supply and the influence on market and trading dynamics

Key Takeaways


7

AGENDA



New supply and the influence on market and

trading dynamics

Key Takeaways


HDPE 17%

LLDPE 12%

LDPE 9%

PP 26%

PS 4%

EPS 2%

ABS 3%

PVC 17%

PET 8%

PC 2%

8 Source: WA 2016

World Polymer Demand PE accounts nearly for 40% of total polymer demand

2016 World Demand by Major Polymers

243 Million Metric Tons

5.2%


9 Source: WA 2016

World Polymer Demand PE mostly consumed in Film and Sheet application

Film & Sheet, representing over 50% of total global PE consumption

World PE Demand by Application

Film & Sheet 53%

Injection Molding

13%

Pipe & Profile 7%

Extrusion Coating

2%

Blow Molding 12%

Wire & Cable 2%

Rotomolding 2%

Fiber 1%

Raffia 1%

Other 7%

2016 Total World PE Demand 92 Million Metric Tons


10 Source: WPC 2015

World PE Demand Mostly consumed in Indian sub, NEA, showing strong demand growth

Y2017 = 95 Million MT Y2022 = 117 Million MT +4% CAGR

33

16 14

8 6 6 5 4 3

43

18

15

10 9 8 6 5

3

5%

2%

1%

5%

9%

4%

3%

4%

3%

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

0

10

20

30

40

50

60

70

80

NEA N.America Europe SEA Indian Sub. MiddleEast

S.America Africa CIS & BalticStates

Million MT

Sum of 2017 Sum of 2022 %CAGR


NEA 37%

N.America 16%

Europe 13%

SEA 8%

Indian Sub. 7%

Middle East 7%

S.America 5%

Africa 4%

CIS & Baltic States

3%

2022

11 Source: WA 2016

World PE Capacity Mostly located in 3 regions: N. America, NEA and Middle east

+3% CAGR

Majority of new PE capacity additions in the next 5 years will be concentrate in

2 regions, North America and North East Asia

Y2017 = 113 Million MT Y2022 = 133 Million MT

3 9 24 28 22 2 5 2 4

6

12

29

34

24

2

6

2 4

16%

5% 5% 4%

2% 2%

1% 0% 0% 0

5

10

15

20

25

30

35

40

CIS & BalticStates

SEA N. America NEA Middle East CentralEurope

Indian Sub. Africa S. America

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

%CAGR Million MT

2017 Capacity

2022 Capacity

Capacity Growth (%CAGR)


12 Source: WPC 2015

World PE Net Trade Flow 2022 N. America will expand its exports into Asia

North America & the Middle East are the two significant net exporting regions

12.9 14.1 4.6 9.1

-0.5

2

0.3 0.0

-0.8 -1

-1.7 -2.4

-2.7 -3.4

-1.6 -2.4

-9.6 -13.5

Net Exporters

Net Importers


13

AGENDA




trading dynamics

Key Takeaways


Source :Global Economic Outlook (Mar 2016), Bureau of Labor Statistics (Mar 2016)

Hard Landing? 4-5% GDP Growth

7.4 7.5

7.1 7.2 7.0 7.0 6.9 6.8 6.7 6.7 6.7 6.8

2014Q1

2014Q2

2014Q3

2014Q4

2015Q1

2015Q2

2015Q3

2015Q4

2016Q1

2016Q2

2016Q3

2016Q4

China GDP Growth (Quarterly Growth, %)

14

China Economics Concerned of slow down

Agriculture 8%

Industry 41%

Services 51%

2016 GDP Composition

50


Services Technology

Domestic Consumptions

China Economics Demand still Grow Continuously with some changes

15

NEW KEY

To CHINESE GROWTH


Although new local CTO-based plants started, China’s import volume almost hit

10 Million tons due to increasing local demand.

4.0

4.7 4.6

5.1 5.3

2.3 2.4 2.5 2.6 2.6

1.6 1.7 2.1 2.2 2.1

7.9 8.8 9.1

9.9 9.9

0

2

4

6

8

10

12

0

1

2

3

4

5

6

7

8

Y2012 Y2013 Y2014 Y2015 Y2016

Mil

lio

ns M

T

Mil

lio

ns M

T HDPE LLDPE LDPE Total PE

16

+3%

China PE Import Demand Still increase continuously

Source: National Bureau of Statistics of China Proprietary information of PTT Polymer Marketing Co., Ltd.

PLASTIC in EVERYDAY

17

TO EAT…

...TO USE


Cost & Volume Reduction

Energy & Water Efficiency

Recyclability

Global Megatrends Cause PE Demand to rise

Source : Townsend, PTTPM

19

Environmental Concerns

Health & Wellness

Aging Population

Safety

Convenient Time

Global Megatrends

Plastic Key Advantages

Market-Driven

Environmentalism & Sustainability Driven


Source : Euromonitor International Ltd 2015 : GLOBAL PACKAGING LANDSCAPE: GROWTH, TRENDS & INNOVATIONS

Healthy Life

Exercise Regularly

Eat Healthy

Drink plenty of

Water

Reduce Stress

Health & Wellness Trend Lead to lifestyle and consumption changes

Eat Healthy

20

Intelligent packaging



Healthy Life

Exercise Regularly

Eat Healthy

Drink plenty of

Water

Reduce Stress

Produced from InnoPlus

HD2200JP, high quality with

excellent organoleptic property.

Listed in well known beverage

brand owner.

Health & Wellness Trend Lead to lifestyle and consumption changes

Drink plenty of

Water

Shrink film produced from InnoPlus LD2420D and LL7910A/7903A/7905A 21

http://www.gayatriplasticspvt.com/shrink-film-for-water-bottles-packing.html

Health & Wellness Trend Greater consumer awareness of health and wellness


Healthy Life

Exercise Regularly

Eat Healthy

Drink plenty of

Water

Reduce Stress

Exercise Regularly

Reduce Stress

22

Sport equipment



Cost &Volume Effectiveness with Performance Result in changes of packaging design, creating more opportunity for plastics


Stretch film produced from InnoPlus LL7835A / LL8420A

24

v n

Cost &Volume Effectiveness with Performance Result in changes of packaging design, creating more opportunity for plastics


Cost &Volume Effectiveness Light-weight product trend in construction industry


Plastic Tank

(LLDPE C6 Rotomolding Tank)

The comparatively low cost, lighter weight and ease of installation of plastic material provides more advantages.

Stainless Tank

Produced from InnoPlus LL9640UP/9641UP



AUTOMOTIVE

Light-weight materials are common needs

26

Cost &Volume Effectiveness Light-weight product trend in automotive industry

Produced from InnoPlus LL8420A


Packaging

Source : IHS (2016) 27

Food & Beverage

Pharmaceuticals

Convenient Time & Safety Thanks to More middle class, aging population & urbanization

Water saving plastic

Retort Pouch

Polyolefin laminated container

High performance down-gauging film

Easy Handling

Convenience and Universal Design

Shelf-life indicator packaging

Multi-layered

Required High

Quality and Strict Hygiene!!


28

Environmentalism & Sustainability Driven Lead to Green-related production

36% sugarcane-based PE bag for organic bread

Bio-Based plastic

Bioplastic coated cup and laminated packaging pouch

Green PE packaging

Bio-composability plastic


29

AGENDA




trading dynamics

Key Takeaways


Key Takeaways

30

Global PE demand still healthy and continuously

growth, especially driven by Packaging Industry

PE Capacities to accelerate in the next 5 years,

mainly from USA and China.

China PE market demand moderately grow along with

the steadily economic growth.

There are lots of opportunities from new market

trends and robust additional capacities. Developing

and adopting quickly are the key to seizing benefits

from dynamic business world.


32

www.pttpm.com

www.facebook.com/PTTPM

www.youtube.com/user/PTTPolymer

@pmsolution

[email protected]


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