Ethylene output falls by 4.7% in 2011- a larger fall than seen in 2008

23-Jan-12

Domestic production of ethylene, a key material for various petrochemical products, in 2011 fell 4.7% from the previous year to 6.69 mln tons, falling below the 6.88 mln tons marked in 2008 when the so-called Lehman Shock affected production. The drop was attributed to stagnant demand from China, Japan's major export market for ethylene, in the latter half of 2011 due to the tightening of monetary policy in the country and the European debt crisis, according to the Japan Petrochemical Industry Association. Kyohei Takahashi, the chairman of the association, said the industry is facing "an extremely severe environment" as "Japan's petrochemical industry depends on exports to China to maintain its operating rate." Disrupted vehicle production following massive flooding in Thailand also affected ethylene output as automakers are major users of the compound, the association said.