Sector News

Borouge feeling the heat from US polymers producers – exec

June 26, 2019
Energy & Chemical Value Chain

Polyolefins producer Bourouge is starting to feel the heat from US competitors sending material to Asia, causing ups and downs in prices which the Abu Dhabi producer is trying to weather, an executive at the joint venture said on Tuesday.

BorougeMichael Pell, senior vice president for marketing at Borouge, conceded US producers are in “push mode” trying to aggressively place their product in Asian markets.

Borouge is an Abu Dhabi-based joint venture between the emirate’s crude oil major ADNOC (60% stake) and Austria’s polyolefins and fertilizers producer Borealis (40%).

The joint venture’s current production capacity stands at 4.5m tonnes/year of polyolefins. Another 480,000 tonne/year polypropylene (PP) plant is under construction.

Pell was speaking at Borealis’ facilities in Linz, Austria.

“We are seeing the challenge of US producers on push mode with their product … [This is a] Challenge which causes large spikes in the supply and demand balance,” said Pell.

As a result of the shale gas boom in the US, large capacities for polyethylene (PE) and, to a lesser extent, for PP, have started up or are in the process to do so in that country.

The markets are expected to be oversupplied for some time, according to analysts.

Source: ICIS News

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