Chow Bee Lin, ICIS pricing, Senior editor

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Asian Polyolefins A Beginners Course
Asian PE and PP markets
Chow Bee Lin, ICIS pricing, Senior editor
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Agenda

• PE PP price drivers
• Challenges of reporting the China market and how
  it is evolving.
• Southeast versus Northeast Asia pricing patterns
  and mechanisms.
• India and the Middle East an unrealised
  potential.
• A 12-month view on price direction with demand
  and supply predictions.

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Global PE PP trade flow
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Asia PE PP trade flow
Source WorldAtlas.Com
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Factors affecting price movements

• Market sentiment.
• Polymer plant shutdowns.
• Government policies.
• Natural disasters.
• Public holidays.
• Perceived stock levels.
• Crude and monomers.

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Impact of monomer prices?
Ethylene has less impact on polymer when supply
is tight and demand is strong.
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Impact of monomer prices?
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Impact of crude prices?
Polymer prices stabilised despite falling crude.
Crude value becomes a less significant price
driver when polymers supply is tight.
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Impact of naphtha prices?
Soaring naphtha prices were a major concern for
regional integrated polymers producers.
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Challenges of reporting on China market

• Market size and structure.
• Localised characteristics of different markets.
• Product types.
• Import demand shifting to new grades.
• Benchmark price concept not established.

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China market in evolution
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Southeast versus Northeast Asia pricing patterns
and mechanisms.
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India and the Middle East an unrealised
potential.
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Price direction going forward
PE prices to rise further on tight supply as most
new capacities due on stream in the Middle East
will start up only in the second half of 2008.
PP prices to weaken gradually due to new
capacities coming on stream

• Samsung Total Petrochemical Q4 2007
• Natpet end December 2007
• Formosa Ningbo Q1 2008
• Jam Petrochemical Q1 2008
• Advanced Polypropylene Q1 2008
• Japan Polypropylene April 2008
• Lotte Daesan August 2008
• Petro Rabigh September 2008
• Saudi Polyoelfins Q4 2008
• Saudi Ethylene Polyethylene Q4 2008
• Yansab Q4 2008
• Sabic Kayan Q4 2008
• Saudi Petrochemical End 2008

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Asia demand
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Thank you!beelin.chow_at_icis.com