Asian petrochemicals producers and stakeholders have expressed cautious optimism at this year’s APIC conference now under way in Taipei, despite forecasts for lower earnings compared with last year. In their opening plenary addresses, chairmen of the seven APIC associations focused on issues affecting the region, including plastics waste.
Fu-Shen Lin, chairman of the Petrochemical Industry Association of Taiwan (Taipei), this year’s host of APIC, noted that the rapid decline in the price of oil in the fourth quarter of 2018 had an impact on Taiwan’s plastics industry and producers suffered losses as prices declined. But profitability recorded in the first nine months meant that the overall operation of the industry was still relatively good. He touched on three main challenges facing Taiwan’s petrochemical industry: energy, restriction on the use of plastics and increasingly strict labor and environmental regulations. But with challenges come opportunities, Lin said. “These challenges can provide excellent opportunity for us to develop high-value products.”
Kohei Morikawa, chairman of Japan Petrochemical Industry Association (JPCA) said that “it is very difficult to forecast demand in Asia at present” but he expressed confidence that in the medium- and long-term, global demand for petrochemicals will enjoy strong growth, reflecting the increase in population and expansion of the middle class. All the speakers talked about the need to curb plastic waste and their leakage into the oceans. “The petrochemical industry must take the lead in resolving the issue of plastic litter in the ocean,” Morikawa said.
Last September, JPCA together with other related organizations, initiated plans to establish the Japan Initiative for Marine Environment, consisting of private enterprises and associations. The initiative aims to step up efforts in this field.
Chairman of the Korea Petrochemical Industry Associated, Dong-Joon Moon, agreed that the petchems market entered a slowdown in the second half of the year, dragging down the performance of Asian petrochemical companies and there are increasing uncertainties this year, he said. New facilities being commissioned in the United States and in other regions, will put heavier pressure on the supply side, “thus we do not expect the business climate to improve,” Moon says. “In particular sluggish growth in emerging countries that are our key markets, the prolonged trade conflicts between the US and China, and the Chinese petrochemical market becoming increasingly self-sufficient, would have a negative impact on demand for the Asian petrochemical industry.”
Kamal Nanavaty, president of Chemicals and Petrochemicals Manufacturers’ Association (CPMA), said that within Asia, China and India remain growth hotspots. While GDP growth in China is projected to dip from 6.6% to 6.1% this year, India’s growth will accelerate from 7.1% last year to 7.3% in 2019 and 7.5% the year after, according to forecasts. The Indian petrochemical landscape witnessed far-reaching changes during 2017 with the world’s largest refinery offgas cracker coming into operation at Reliance Industries’ Jamnagar site and large-scale shipping of ethane from the US Gulf Coast to India to feed some of Reliance’s crackers. In 2018, Indian Oil commissioned a 700,000-metric tons/year polypropylene plant at Paradip.
Nanavaty referred to various shifts that are currently taking place on the global scene. “The emergence of electric vehicles and plans for phasing out combustion engines makes it necessary that more of our hydrocarbon resources are used for further value addition to petrochemicals. Going forward, unprecedented amounts of hydrocarbon feedstocks will be available for use in petrochemicals,” he said. Touching on sustainability issues, he said that the petrochemical industry in India has embraced the concept of circular economy. “Building on the remarkable long life of plastics, the circular economy has created huge opportunities for reuse and recycling, while addressing one of the toughest challenges of our time—material pollution and environmental degradation.”
The keynote speech was delivered by an academic and a veteran of the petrochemical industry, Yen-Shiang Shih, on ‘Working together towards sustainable and responsible petrochemical industry’. He singled out three explosions—the 2014 Kaohsiung, Taiwan explosion, the 2015 one at Tianjin, China and the 2019 explosion at Jiangsu. These events damaged public trust in the chemical industry and “discouraged the young generation from joining our industry.” Shih advocated the concept of the three Rs—reduce, reuse and recycle and is a strong supporter of the circular economy initiative.
APIC’s committee meetings which deal with different individual product groups, have also attracted big crowds. At the general matters and raw materials committee, Tony Potter, vice president/specialty chemicals at IHS Markit, said that global demand for ethylene is growing at 6 million metric tons/year (MMt/y), this translates into 60 MMt/y of capacity needing to be added in in the next 10 years. Several countries in Asia have an olefins deficit, Potter pointed out. India’s demand growth justifies an investment in a world-scale olefins complex every 18 months to two years between now and 2024, he said. “There are big projects being developed in India but there just aren’t that many being developed that quickly,” Potter said.
By Natasha Alperowicz
Source: Chemical Week
During a European Industry Summit held on the site of BASF in Antwerp, leaders from basic industry sectors, representing 7.8 million workers in Europe, joined forces with European trade unions and European leaders to address pressing concerns regarding Europe’s industrial landscape.
The use of blue or low-carbon hydrogen, made from natural gas with carbon capture and storage (CCS), could increase near-term global warming by 50% compared with burning fossil fuels directly for energy if emissions are not properly managed, according to a new study by NGO the US Environmental Defense Fund (EDF) and the University of Arizona.
In a move to improve the supply of renewable hydrogen and thus reduce dependence on natural gas and contribute to achieving the objectives of the European Green Deal and the REPowerEU plan, the EU Commission has approved a third Important project of common European interest (IPCEI) to support hydrogen infrastructure.