MOSCOW (MRC) - Imports of polypropylene to Russia in 2012 increased by 43% compared with 2011. Start of production of two new sites in Omsk and Tobolsk in 2013 should significantly change the balance of the Russian market of polypropylene, according to MRC DataScope.
PP imports to Russia in December last year rose to 20,400 tonnes. Total imports in 2012 to Russia made about 276,400 tonnes of polypropylene, up 43% year on year. Production capacities are unable to meet the growing needs of the Russian market of polypropylene, but in the second half of 2013, the balance of the market may change with the launch of two new sites with total capacity of 430,000 tonnes.
Russian converters faced shortage of polypropylene in April-May last year. Price of homopolymer polypropylene (PP homo) amid deficit in May rose to Rb72,000-74,000/tonne, CPT Moscow, including VAT. The market began to actively seek alternative sources of supply polypropylene. Since May, imports of polypropylene to Russia began to rise and reached a peak in June - more than 34,000 tonnes.
The total volume of import of PP-homo to the Russian market in 2012 amounted to 138,500 tonnes, up 35% more than a year ago. External supplies of block copolymers of propylene increased by 35% to around 51,400 tonnes. Imports of stat- copolymers of propylene increased by 67% to 47,000 tonnes.
Two new production sites are expected to be launched in the middle of the Q2. Omsk Polyom (Titan Group) has an annual capacity of 180,000 tonnes. Technology "Spheripol" from company LyondellBasell allows to produce about 80 grades of polypropylene, including copolymers of propylene. Tobolsk-Polymer (Sibur Group) plans to launch first polypropylene plant capacity of 250,000 tonnes per year. However, production range will include only homopolymers of propylene.
Given the launch of new capacities and existing production sites in the second half of the year we can expect a major structural change in the market of PP homo. The specifics of the market of copolymers of propylene will slow down substitution of import by Russian product.
MRC