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The Pakistani Scenario - Raw Material Manufacturers
 

Raw material production in Pakistan is extremely low and does not meet the required demand. As per Government Statistics, the import bill of all plastics raw material reached Rs.6.7 Billion in the year 1993. Uptil 1994, almost all plastics raw material consumed in Pakistan was imported, amounting to about 0.45 millions tons of plastics raw material imports annually, exerting a great burden on the national economy.

Various entrepreneurs in Pakistan considered setting up of hydro-cracker plants in Pakistan. In the corresponding period, in neighbouring India, about 5 raw material producers had commenced production of indigenous plastics raw materials catering to the local industry, as well exporting the surplus. This acted as a trigger for the speedy implementation and commencement of petrochem projects in Pakistan.
In 1984, to achieve self sufficiency in PVC and to save foreign exchange, FCCCL in a joint venture with FECTO (Pakistan) Limited had the opportunity to submit a feasibility report and application for setting up a 20,000 tpa plant in Kala Shah Kaku near Lahore. The formal approval was granted in January 1986, but the plant could not be set up due to unknown reasons.
It was Engro Asahi Chemicals Pakistan, who took the lead and set up a PVC Plant in Karachi- the first of its kind in Pakistan. It was a joint venture with Japanese companies that took the initiative and established this mega project in the country. Similarly 3 more plants producing PET, High Impact Polystyrene, Melamine Formaldehyde and Expandable Polystyrene were also set in Karachi.

No statistics are available on the exact consumption of plastics raw materials in the country, but a modest estimation indicates that more than one million tons of different plastics are required every year. The present production capacity of the four raw material producers is about 288,000 tons. This can barely meet 28% of the estimated demand, leaving a shortfall of 722,000 tons. This gives room for imports and constitutes a burden on the national economy. The following table shows the present production of raw material producers in Pakistan.

Plastics Raw Material Production in Pakistan
Company Product Capacity
Gatron Industries PET 120,000 Tons
Engro Asahi Polymers PVC 100,000 Tons
Pak Petro Chemicals   HIPS & PS 34,000 Tons
Dynea Pakistan Ltd. Methanol Urea Melamine 34,000 Tons

A brief rundown about the raw material producers in Pakistan is as follows:

PET RESIN ( Polyethylene Terephthalate)
Gatron Industries was established in 1984 as a producer of texturized and flat polyester filament yarn. Successive innovations and developments made Gatron the first and only producer of PET bottle grade resin in the country. The present production of PET Resin is 120,000 metric tons of bottle grade material annually. The plant is located on main Hub River Road some 35 Km West of Karachi. Gatron Industries Limited has its Polymerization Plant and Technology from Zimmer AG, Germany, and the Solid State Polycondensation Plant and Technology from Sinco Engineering, Italy. With the best combination and innovative management approach, Gatron produces the highest quality PET Resin bottle grade named “Gatronova PET Resin”, equivalent to any good quality PET Resin in the world.
Presently there is a huge potential of growth as demand is increasing due to high consumer usage in Pakistan and all over the world.

PVC (Polyvinyl Chloride)
Engro Asahi Polymer & Chemicals Limited Pakistan (EAPCL), in a Joint Venture with Asahi Glass Company and Mitsubishi Corporation of Japan set up a PVC Plant in Karachi. The plant went into full production in the year 1999. and since then it is producing about 100,000 metric tons. Present domestic PVC requirement is about 70,000 metric tons annually- an extremely low level in Pakistan vis a vis global PVC consumption. In terms of usage it is 0.49 kg per capita. The surplus capacity is being exported to Australia, Dubai, Bangladesh and other countries. In Pakistan. there is a lack of awareness on the part of PVC processors and consumers. Processors lack a general awareness of the multi range and versatility of PVC products. At present only traditional PVC items are being manufactures i.e. pipes and fittings, shoes, cables, bottles, water conservation and compounding etc. A huge potential for growth in PVC products indicates an tremendous growth estimated in the years ahead for PVC manufacturers.

HIPS (High Impact Polystyrene)
Pakpetro Chemicals Industries is recognized nationally and internationally as a respected producer of fine quality polyester resins. The company was established in 1994 in collaboration with a Taiwanese team. The unit is located 25 kms North of Karachi. Pakpetro produces 30,000 tons of GPPS and HIPs. About 60% of this is domestically consumed, while the rest is exported to Germany, South Africa, Lebanon, Egypt and Turkey. Due to increased demand, the Company plans to start local production of ABS in the near future. Pakpetro as a sole producer of polystyrene is planning to increase the capacity by 40% initially and subsequently by 100%.

Methanol Urea Melamine
Dyno Pakistan Limited was formed in early 1982 as a joint venture between Habib Group of companies and Dyno Industrier A.S.A of Norway. The name of the company was changed to Dynea Pakistan Limited in 2002. It is a public limited company with Dynea A.S.A. of Norway & Habib Group being the major share holders. Dynea A.S.A. is a multinational with 100 wholly or partly owned companies in over 40 countries. Core business of Dynea A.S.A. is manufacturing of formaldehyde & formaldehyde based resins. Almost 90% of Dynea's turnover is generated outside of Norway.
Dynea Pakistan Limited produces quality urea resin for use in industries like particleboard, chipboard, veneerboard and melamine resin for lamination industry. Together with its wholly owned subsidiary, Visionite Pvt. Limited, it is also the largest producer in Pakistan, of moulding compound used for manufacturing dinner sets and electrical accessories.
Manufacturing of formaldehyde and aminoplast resins and of moulding compound were both pioneering ventures introduced for the first time in Pakistan. Now only a small quantity of moulding compound is imported into the country and there are no imports of formaldehyde or liquid resins. Tableware industry has grown 10 times because of the availability of locally manufactured raw material. These industries have also helped save huge foreign exchange for the country.

In addition to above raw material producers, another two raw material plants, one in Karachi and other in Lahore, have yet to take off. These units have a combined capacity of 35,000 metric of EPS, HIPS and PS.
(Contributed by Mr. F Chaudhary - a Karachi based journalist)

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