Upcoming metallocene LLDPE capacity could pressure prices to levels below LDPE

Metallocene linear low density polyethylene (mLLDPE) is to get cheaper than low density polyethylene (LDPE), as per ICIS. C6 mLLDPE is marketed as a premium resin with superior features such as easy processability and high tearing resistance, has been priced at at least US$50/ton over commodity PE film grades in recent years. However, this year's global tight supply has pushed LDPE film grade up by as much as US$100/ton above C6 mLLDPE by the end of October. With the expected rapid rise in mLLDPE capacity in Asia in the next two years, this situation could exacerbate. ExxonMobil is due to start up two 650,000 tpa LLDPE plants in Jurong Island, Singapore, by end 2011. Its existing 600,000 tpa LLDPE plant at the same site is expected to focus on C6 mLLDPE production once the new plants come on stream. Japan's Prime Polymer is expanding its 190,000 tpa mLLDPE plant at Chiba by 20,000 tpa by debottlenecking process that will be completed around mid-November, and to 250,000 tpa in Q4-2011. LG Chem has recently reduced high density polyethylene (HDPE) pipe-grade production at its 150,000 tpa plant in Daesan, in favor of producing C6 mLLDPE. India's Gas Authority of India (GAIL) is looking at producing around 35,000 tpa of mLLDPE at a new 300,000 tpa PE plant it plans to start up in 2013 at Pata, as demand for metallocene-grade PE continues to advance in India at a double-digit rate for high-end packaging applications. ONGC Petro-additions Ltd. is planning to produce 35,000-40,000 tpa mLLDPE at its new cracker complex in Dahej, due to come on stream at the end of 2012.
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