The global PVC market will continue to grow in the next five years

wallpapers Industry 2020-12-09
Lee fagg, head of Asia business of

Nexant, reported at the Asia Petrochemical Industry Conference (APIC) held recently in Seoul, South Korea, that the global demand for PVC will continue to grow at an average annual growth rate of 3.5%. The global consumption of PVC is expected to be 43 million tons in 2015, 51.5 million tons in 2020, and 75 million tons in 2030. The driving force of PVC market demand growth in the future mainly comes from emerging economic market regions, especially India, central and Eastern Europe, and South America.

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Asia Pacific region accounts for nearly 60% of the global PVC market share. In the foreseeable future, the Asia Pacific region will continue to lead the global PVC demand growth. North American and Western European markets have returned to growth after severe recessions in previous years, although growth is expected to be slow.

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emerging economies lead the market growth,

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construction industry is the main consumer market of PVC resin. In China, although the growth of construction industry has slowed down, the PVC market will continue to grow at a rate higher than that of most other countries in the future. In India, with the implementation of "made in India" and vigorous development of infrastructure, the demand for PVC resin will increase greatly. In particular, the annual consumption of PVC per capita in India is only 2.5 kg, which is far lower than the world average of 6.1 kg. It is expected that the PVC market demand in India will maintain an average annual growth rate of 7% in the next 10 years and become the main driving force in the world.

PVC demand in central and Eastern Europe, Southeast Asia and South America will also maintain a rapid growth rate. In the past few years, due to the weakening of macro-economy, the sluggish construction market in the United States and other countries has affected the growth of PVC demand. At present, with the recovery of the construction market, the demand for PVC resin will increase at an average annual growth rate of 2.5%. In Western Europe, the demand of Mediterranean countries seems to have reached the bottom, while the demand of Germany, France and Britain is relatively stable. It is expected that the annual growth rate of PVC demand in Western Europe will maintain 1.8% in the next few years.

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overcapacity perplexes the development of the industry. Analysts from IHS chemical company

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predict that the PVC industry in the world will continue to suffer from overcapacity in the future. The average annual growth rate of global PVC demand was 4.8% from 2001 to 2007. After that, due to the financial crisis, the demand slowed down sharply. In 2008, the demand dropped by 9%, and in 2009, it continued to fall by 2.5%. With the recovery of demand in 2010, the PVC market resumed growth, but the growth rate remained flat Over the past three years, the average annual growth rate was only 3%. In 2013, the world demand for PVC was only 39 million tons. At the same time, the production capacity of various regions has rapidly increased to 58.5 million tons, and the annual net surplus is as high as 20 million tons. It is estimated that the global PVC production capacity will still far exceed the demand by 2020.

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however, the supply and demand situation varies greatly among regions. North American producers will have a relatively good time, not only because they can enjoy the energy and ethylene resources advantages of shale development, but also because they have completed the industrial rationalization and restructuring. In addition, North American investors will not choose to expand vinyl resin production capacity due to higher profit margins of other ethylene derivatives. The degree of overcapacity and dispersion of

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in Asia is more serious than that in other regions, and the problem of market oversupply in the future will be more prominent, especially in China. From 2006 to 2013, China's PVC production capacity increased by 19.6 million tons to 27.9 million tons. During the same period, PVC demand only increased by 6.3 million tons, reaching 14.5 million tons, and the excess capacity was as high as 13.4 million tons, accounting for 67% of the world's overcapacity. Nexant Asia predicts that China will increase PVC production capacity by 7 million tons by 2018. The serious overcapacity of

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has led to a rapid decline in the operating rate of the global PVC industry, which was 88% in 2007 and 72% in 2013. It is estimated that the global operating rate will be 77% this year. Nexant Asia said that with the improvement of world demand, the operating rate of PVC industry will slowly increase in the next few years, and it is expected to maintain about 85% by 2020. The world trade flow of

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continues to change. Since the second half of 2014, the international oil price has fallen sharply and maintained a low level, and the global vinyl resin industrial chain has also been affected. In the future, PVC exports from the United States and China will gradually expand.

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North American PVC industry operating rate rebounded. IHS chemical company analysis pointed out that the average PVC operating rate in North America reached 86% in 2013 and will rise to more than 90% in the next few years. Market participants believe that the recovery of PVC industry in North America is mainly due to export pull. It is expected to take at least 10 years for demand in North America to return to pre recession levels. According to the analysis of

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, PVC production capacity in North America will increase to 9 million tons in 2016, which will far exceed the demand of the region. However, relying on the advantages of ethylene and energy costs in the region, local producers have stronger competitiveness in the international market. In the future, more PVC products will enter the neighboring South American market in North America, including other markets in the Middle East and even Asia. From 2010 to 2015, the annual export volume of PVC in North America basically maintained at 1.5 million tons, and it is expected that the export volume will further increase to 3 million tons after 2020.

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in China, with the change of raw material cost structure and market, China's PVC supply pattern is also changing, from a net import of 1 million tons in 2010 to a net export of 500000 tons in 2015. It is expected that the net export will expand to 1 million tons by 2020, and the export destinations will include other regions in Asia and the Middle East.


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