Mixed Trends for Polyolefins Trade in 2011

Trends in global polyolefins trade volume in 2011 were mixed: up 3%-5% for LDPE, HDPE, polypropylene and propylene copolymers; up 14% for ethylene copolymers; and down 1% for LLDPE and 3% for EVA.

Only two of the polyolefins, HDPE and ethylene copolymers, had slightly higher growth in global trade volume in 2011 than in 2010, each up one percentage point.Trade in the other polyolefins either grew at a lower rate than in 2010, or contracted, impacted by generally weaker demand in Asia-Pacific, Western Europe, Eastern Europe and Latin America, although there were exceptions, depending on the polymer and the region.

To put 2011 into historical perspective it is helpful to review some of the trends in 2009 and 2010, two very different years. In 2009, global trade volume had expanded by 3%-13%, with most of the polyolefins up around 8%.  A major factor that year was the unprecedented increase in China’s imports, volumes soaring 39%-138%. This massive surge, plus higher imports also into other Asia-Pacific countries, offset the depressed demand that was evident elsewhere after the financial crisis of 2008.  Demand in the Asia-Pacific region pulled in supplies from other regions. Shipments of polyolefins visible from the Middle East to Asia-Pacific totaled 4 million tons, up over 70%. Western Europe and North America supplied another 4.3 million tons, and substantial volumes were also provided by Eastern Europe and Latin America, both up sharply from 2008.

In 2010, even stronger growth was apparent from the 6%-15% increase in global trade volumes, with all the polyolefins except HDPE and polypropylene toward the upper end of the range. China’s imports slowed, but this was more than offset by gains in other Asia-Pacific markets plus a rebound in demand in other regions, especially Western and Eastern Europe.  China’s imports in 2010 of HDPE, EVA and polypropylene fell 5%-9%; propylene copolymers imports were flat; LDPE rose 3%; LLDPE rose 13%; and smaller volume ethylene copolymers grew 25%. Despite the slowdown in China, Middle East polyolefin exports to Asia-Pacific increased about 70% for the second year in a row, to 6.8 million tons.  Also up sharply in 2010 were Middle East exports of several polyolefins to Western Europe and Eastern Europe. Exports from other regions to Asia-Pacific, however, fell: Western Europe, down 9%; North America, down 26%; Eastern Europe and Latin America, also much lower.

Weaker demand in 2011 in Asia-Pacific, Western Europe, Eastern Europe and Latin America was apparent from lower growth figures for intra-regional trade and imports for most of the polyolefins. Among the exceptions: Africa was a growth import market for polypropylene and LDPE; in Asia-Pacific, growth rates increased on imports of polypropylene, up 10%, and EVA, up 14%, both up from declines of around 5% in the prior year. Interestingly, growth rates in 2011 on imports into China of most of the polyolefins actually improved versus 2010, either increasing or becoming less negative: LDPE, up 6%; HDPE, up 1%; propylene copolymers, up 11%; EVA, up 5%; polypropylene, down 2%; ethylene copolymers up 22%.  LLDPE imports fell 1%, noting, however, the rise in imports into China of ethylene copolymers, analogous to the faster rate of expansion in China’s propylene copolymer imports as compared with polypropylene homopolymer imports in recent years.

Middle East polyolefin exports to Asia-Pacific expanded in 2011, but at a slower rate than in the prior two years, up 20%, to 8.1 million tons. Eastern Europe continued to be a strong growth export destination for most Middle East polyolefins. Middle East exports of LLDPE to Western Europe jumped 48% and shipments of polypropylene, propylene copolymers and ethylene copolymers to the region also were up substantially from 2010.

A striking change in 2011 was the surge in exports out of Asia-Pacific: LDPE, up 32%; LLDPE, 54%; HDPE, 52%; polypropylene, 34%. The region exported over 2 million tons to other regions, with large percentage increases on shipments to Western Europe, Eastern Europe and Latin America, and, for polypropylene, also to Africa. South Korea, India and Thailand were major exporters, with other countries also shipping sizeable volumes. Latin America’s exports, 0.8 million tons, also were much higher, Western Europe and Asia-Pacific top destinations.

These are a few of the trends in ITP’s World Trade Annual Reviews of 2011. The Reviews are detailed analyses of trade between countries and regions, based on import/export statistics from 60 countries, representing nearly all of the world’s trade volume. ITP measures trade volume as the sum of imports into all countries, which equals exports from all countries, as each import has a corresponding export. As the volume of product traded globally is a direct measure of a significant part of apparent demand for the widely traded products in the Reviews, percentage changes in trade volume from year to year generally reflect actual changes in demand.

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Jean J. Sudol
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