Plastics News staff reporter Frank Esposito covered the following items at the World Petrochemical Conference 2000 sponsored by Chemical Market Associates Inc. and DeWitt & Co.'s 2000 World Petrochemical Review, both held March 28-30 in Houston. Fina nears production of metallocene pp
Fina Oil and Chemical Co. of Dallas expects to reach full commercialization of its new metallocene-catalyzed syndiotactic polypropylene in La Porte, Texas, by mid-2000.
Syndiotactic PP is designed to offer superior clarity, toughness and other characteristics.
Initially, the material will be blended with conventional PP or other polymers to improve performance.
Applications in the film, fiber and foam markets will be among the first commercialized, according to Joseph Schardl, market development manager at Fina's research and technology center in Deer Park, Texas.
Schardl declined to release a specific production number, but said the La Porte plant would be producing "tens of millions" of pounds of syndiotactic PP in 2000.
Fina also is working to commercialize metallocene-catalyzed isotactic PP, but has no target date for commercialization.
Ethylene saddled with overcapacity
In spite of strong price gains in 1999, the North American ethylene market looks to remain below reinvestment levels through 2001, according to Mark Eramo of Chemical Market Associates Inc. of Houston.
"The strong economy has helped keep ethylene growth high," Eramo said. "The decision to start building more capacity looks easy, but the economics of the market are saying don't build."
Ethylene prices rebounded to an average of 25 cents per pound in 1999 after averaging 21 cents per pound in 1998.
World demand is expected to climb 5.3 percent annually between 1999 and 2004. But Eramo projected that the North American market will carry more than 5 percent surplus capacity until early 2003, causing weak margin situations to continue.
The North American market will gain 2.8 billion pounds of ethylene capacity in 2000 alone when Nova Chemicals and Dow/Union Carbide open a jointly owned cracker in Canada.
Eramo added that the combined Dow/Carbide will be the world's largest ethylene suppliers with about 10 percent of global capacity.
"The `New Dow Chemical' will most likely be setting standards for competition in the future," he said.
Rhodia set to pounce on high PET demand
Rhodia-ster SA of Sao Paulo, Brazil, is accelerating its plans to add PET resin capacity at its Cabo, Brazil, site because of increased PET demand in Brazil and elsewhere in South America.
The company had planned to add 220 million pounds of PET at Cabo in 2002, but now will do so in 2001, marketing and planning manager Leandro Guimaraes said.
"We saw 13 percent growth [in PET demand] last year, even though many producers expected no growth because of a currency devaluation early in the year," Guimaraes said.
"I said there would be 10 percent growth, and everyone thought I was crazy," he said.
Guimaraes expects Brazilian PET consumption to climb from 650 million pounds in 1999 to almost 750 million pounds in 2000, a jump of about 15 percent.
In South America as a whole, those numbers should rise from 1.1 billion in 1999 to almost 1.3 billion in 2000, an 18 percent boost.
In addition to the Cabo site, Rhodia-ster operates almost 400 million pounds of PET capacity in Pocos de Caldas, Brazil. It also can produce about 30 million pounds of PET in Valencia, Venezuela.
Resin makers poised to make more profits
Plastics could replace competing materials at a faster rate in the next couple of years, allowing the resin industry to return to reinvestment-level profits by 2002.
That's the optimistic word from Gary Adams, president of Chemical Market Associates Inc. He believes the industry is shaking off the effects of high prices and the Asian financial crisis.
"You see it all over the place," Adams said. "You go into the rodeo in Houston and they hand you a PET beer bottle. You get high molecular weight, high density polyethylene bags in the grocery store."
Adams selected his 2002 target date after giving the industry time to work through the effect of whiplashing energy prices in 1999 and to absorb new capacity set to hit the market in 2000 and 2001.