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European PET supply to increase in 2014 (10-10-2013)
A series of plant startups are expected to add to European polyethylene terephthalate (PET) supply in 2014, though there or indeed if all planned startups commence production, as per Platts. Sources at the EPCA conference in Berlin this week also considered the likelihood of capacity adjustments and plant closures.
Among the expected new plants are a 390,000 tpa PET plant in Geel, Belgium, at BP's petrochemical complex by India's JBF Industries; Lotte UK's new 200,000 tpa PET plant in Wilton; and EIPET,a 420,000 tpa venture in Sokhna, Egypt, which is a 70% subsidiary of India's Dhunseri Petrochem & Tea with 23% and 7% equity participation from Egyptian Petrochemicals Holdings Co (ECHEM) and Engineering for the Petroleum and Process Industries (ENPPI) of Egypt respectively, and is planned to serve customers in North Africa, North America and Europe.
Lotte's new plant was originally planned to open in Q3-2013. It was then postponed to Q4, and is now slated for the first quarter of 2014. JBF's plant was originally slated for Q2-2014, but many sources said they expected it to be delayed until H2-2014, and one non-company source said they had good information that the plant would not open until early 2015. The EIPET project has been subject to several delays, particularly given the political situation in Egypt, but a company source said that plant was now expected to be complete in November, with production set to start in December. The unit has two lines of 210,000 tpa each. In addition, a source at Cepsa said the company was planning to increase its 175,000 tpa plant in San Roque, Spain, by 50,000 tpa, but this would only come into effect in 2015. In terms of capacity reductions, there is even greater uncertainty at this stage.
There is the possibility of closure at Indorama's 168,000 tpa plant in Workington, UK, as it is not considered competitive or sufficiently profitable. Similar concerns surround the company's 161,000 tpa plant in Ottana. Sources are also waiting to see what happens with plants belonging to La Seda de Barcelona and its PET division, Artenius. Last month, LSB applied to the commercial court in Barcelona for consent to sell its 170,000 tpa Artenius Espana PET operation at El Prat de Llobregat and the chemicals plant of Industrias Quimicas Asociadas LSB (IQA) in Tarragona. LSB simultaneously applied to the court to initiate a sale process of its shares in Turkish company Artenius Turkpet in Adana, which runs a PET plant with a 130,000 tpa capacity. In May, La Seda announced that Artenius would permanently close its 80,000 tpa PET plant in Volos, Greece, as a result of profitability loss due to the site's limited production capacity and the fall in local demand. It subsequently also closed its 200,000 tpa plant at San Giorgio di Nogaro. Turkish textile company PolySan bought the Volos plant last month. The increased production will likely mean that PET likely remains more of a buyers' market in 2014, despite some increases expected in downstream demand.
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