HOUSTON - Thermoplastic resins made with metallocene catalyst technology have dented markets for thermoplastic olefins, and they are expected to ravage markets for styrene-butadiene copolymers and ethylene-vinyl acetate copolymers. A two-year study of the market potentials for metallocene polymers by Chemical Market Resources Inc. based in Houston, shows a 2.1 billion pound annual market for metallocene resins merely as replacements for existing, more costly materials.
The study says additional markets for polymers made with metallocene technologies in new applications are expected to develop as processors become more familiar with metallocene resins.
William Kuhlke, president of the Houston-based consulting firm of Kuhlke & Associates, said he expects metallocene resins to penetrate 20 percent of the market for polyethylene resins, but not until the next century.
Kuhlke said low levels of market penetration will force producers to maintain a premium price for metallocene resins as they seek to recoup their investments in the technology.
Kuhlke based his predictions on the history of linear low density PE, which was introduced in 1977, but which did not produce savings for the industry until 14 years later.
Bilaji B. Singh, president of Chemical Market Resources, discussed his company's market study Sept. 21 at the SPO '95, the fifth international business forum on specialty polyolefins. SPO '95 was sponsored by Schotland Business Research Inc. of Skillman, N.J.
Kuhlke delivered a separate paper on the pricing of metallocene resins and the impact of pricing on polyolefin markets.
Metallocene-produced thermoplastic olefin resins, as well as other new forms of thermoplastic olefins produced with conventional catalyst systems in reactors, already have taken market share from physically blended TPOs, Singh said.
The new TPOs are expected to continue to take market share until they replace physically blended TPOs completely, Singh said. Ninety million pounds of physically blended TPOs are sold each year, he noted.
Many physically blended TPOs use SB elastomers as impact modifiers.
Along with the replacement of SB copolymers in those TPO applications, Singh sees metallocene resins winning 78 percent of the 415 million pound per year market for SB elastomers.
Specialty applications for SB elastomers - such as styrene-isobutylene-styrene used in adhesive applications and other SB elastomers used as viscosity modifiers - will continue to provide a 90 million-pound-a-year market for SB elastomers, Singh said.
However, he said metallocene resins make more sense economically and chemically for the numerous blends and for many of the products made with SB elastomers today.
``The 525 million-pound market for high EVA products likely will disappear,'' Singh said, noting that he expects metalloceneresins to consume immediately the 203 million-pound-per-year market for films that contain high percentages of EVA. EVA is used to increase flexibility, impact resistance and sealing strength and to act as vapor barriers.
As metallocene resins come to dominate that film market, Singh said he also expects metallocene resins to dominate markets for hot melt adhesives and for extrusion coating and wire and cable insulation.
Singh expects the 185 million pound market for atactic polypropylene/amorphous polyalphaolefins (APP/APAO) copolymers also to disappear as the use of metallocene resins becomes widespread.
Beyond those applications, Singh believes metallocene resins will claim about 16 percent - just more than 1 billion pounds a year - of the 6.2 billion-pound-per-year market for flexible PVC compounds, especially in applications for nonshrink packaging film, blister packaging films, medical films, pool and pond lining films, wall coverings, industrial tapes and laminates, shrink films and flexible ducts.
Kuhlke was optimistic about metallocene resins' ability to penetrate existing markets, but realistic about the cost benefits of metallocene resins based on the history of LLDPE.
He noted that it required 14 years - from 1977-1991 - for Union Carbide Corp.'s development of LLDPE to provide a savings in the marketplace, although a price premium charged for LLDPE disappeared in 1984. LLDPE competed with low density and high density PE.
``In 1991, the production of LLDPE grades in the United States reached 4.2 billion pounds vs. 7.2 billion pounds for LDPE and 9.2 billion pounds for HDPE,'' Kuhlke said.
``On a percentages basis, LLDPE grades represented about 21 percent of the total market, or 37.5 percent of the low density market, far exceeding the 6.4 to 15.5 percent [of the market] that metallocene products might capture by 2000. We don't anticipate metallocene-produced polyethylene grades to reach 20 percent of the [polyethylene] market until well into the next century,'' he said.
``Thus, we feel the premiums for the metallocene produced polymers will continue well into the next decade,'' he said, noting that metallocene resins' superior performance characteristics - which permit processors to reduce the gauge of films while maintaining the same penetration resistance - and balanced properties will help producers to justify higher prices for those resins.
