China set to add large new PET capacities in April and May

Several large new PET capacities are set to come on-line in China this April and May. The country is expected to add a total of around 1.7 mln tons of new capacity in H1-2012, which will bring China’s total PET capacity to around 6.5 mln tpa, as per ChemOrbis. In 2011, the country consumed around 3 mln tons of PET, suggesting that much of the new capacity will be offered to the export market. China Resource Chemicals (Huarun) will add three new lines with a combined capacity of 900,000 tpa this year. Two of these lines are being built at the company’s existing plant in Changzhou and the other line is being built as part of a new plant in Zhuhai, China. Each of the new lines will be able to produce 300,000 tpa of PET. The new plant in Zhuhai and one of the new lines in Changzhou were scheduled to start production by mid-April, while the second new line in Changzhou is expected to start production in early May. The company will become the largest PET producer inside China once these new capacities are installed, with the company’s annual production capacity set to reach 1.3 mln tons. A source from the company commented, “We expect to achieve normal operating rates at our new capacities next month. We do not feel that our new capacities will put any downward pressure on prices as the high season for PET bottles will be starting soon and Chinese export prices are competitive when compared with offers for other Asian origins such as South Korean.” A PET bottle manufacturer in Vietnam told ChemOrbis, “We are seeing good demand for our end products these days and are planning to expand our own business in June. We are aware that large new capacities are coming on-line soon, but we do not expect these capacities to have a major impact on the market over the short term.” In addition to China Resource Chemicals’ new plant, Indorama Ventures Public is building a new PET plant in Kaiping City, southern China, with a capacity of 400,000 tpa. The plant is expected to start commercial operations in late April. Zhejiang Wankai New Materials Co. is planning to expand the capacity of its existing plant in Haining City, China, by 400,000 tpa during H1-2012. Combined with its existing 250,000 tpa production line, the company will be able to produce 650,000 tpa of PET.
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