World Plastic Industry Review

OUTLINEOVERVIEW OF THE PLASTICS INDUSTRY MAJOR THERMOPLASTICS TO BE REVIEWED POLYETHYLENE POLYPROPYLENE POLYSTYRENE CONCLUSIONS

THE PLASTICS INDUSTRYR E S

TI M E

I N S

ND E

SE U

FABRICATION METHOD

MAJOR WORLD REGIONSNORTH AMERICA LATIN AMERICA WESTERN EUROPE EASTERN EUROPE THE MIDDLE EAST THE FAR EAST

MAJOR POLYMERSTHERMOPLASTICS

– POLYETHYLENE – POLYPROPYLENE – POLYSTYRENE – POLYVINYL CHLORIDE – ABS/SAN – STYRENE BUTADIENE LATEXES – POLYCARBONATES – PET – NYLON – ENGINEERING THERMOPLASTICS

MAJOR POLYMERSTHERMOSETS – EPOXIES – MELAMINES – UNSATURATED POLYESTERS – PHENOLICS – UREAS – POLYURETHANES – POLYLACTIC ACIDS

MAJOR FABRICATION PROCESSESINJECTION MOLDING BLOW MOLDING EXTRUSION – FIBER – FILM – SHEET AND THERMFORMING – PROFILE – PIPE – WIRE & CABLE COMPOUNDING CALENDERING COMPRESSION MOLDING ROTOMOLDING OTHER PROCESSES

MAJOR END USE MARKETSEND USE PACKAGING (Bottles, Film, Cups, etc.) BUILDING & CONSTRUCTION (Pipe, Siding, insulation, etc.) CONSUMER & INSTITUTIONAL (Toys, Housewares, Medical, etc.) TRANSPORTATION FURNITURE & FURNISHINGS ELECTRICAL/ELECTRONICS (W&C, Computers, Appliances, etc.) US MARKET 2000 (kTons) Percent of Total Market

9683 8554 5290 1846 1694 1461

25% 22% 13% 5% 4% 4%

MAJOR END USE MARKETSEND USE ADHESIVES/INKS/COATINGS INDUSTRIAL MACHINERY ALL OTHER (Compounding, Resellers, Unknown) TOTAL DOMESTIC EXPORTS TOTAL US MARKET 2000 (kTons) Percent of Total Market

924 464 5228 35146 4396 39542

2% 1% 13% 11% 100%

ISSUES FACING THE PLASTICS INDUSTRY1.

SUSTAINING DEVELOPMENTA. B. C.

OBTAINING ACCEPTABLE PROFITS ENVIRONMENTAL STEWARDSHIP CORPORATE RESPONSIBILITY CAPTIVE CONSUMPTION RISE OF MIDDLE EASTERN PRODUCTION STATE OF GLOBAL ECONOMIES

2.

ECONOMIC ISSUESA. B. C.

ISSUES FACING THE PLASTICS INDUSTRYADDRESS PLASTICS ROLE IN POSSIBLE CLIMATE CHANGES 4. DEVELOP NEW PRODUCTS 3.1. For Example: Improved Packaginga) b) c)

Longer Shelf Life Less Wastage of Products Improved Health and Safety

ISSUES FACING THE PLASTICS INDUSTRYFEED STOCK SUPPLY 6. INTERNATIONAL TRADE 7. IMPROVE PLANTS5.A. B.

NEW PROCESSES UPGRADE OLD PLANTS

COMPANY PERFORMANCERESIN COMPANIES REPORTING POOR PERFORMANCE IN 2001 FOR CHEMICALS AND POLYMERS

DOW EASTMAN EQUISTAR CHEVRON/TEXACO BP EXXON-MOBIL

AECI EVC SINOPEC FORMOSA PETKIM TESSENDERLO ATOFINA

POLYETHYLENEPRODUCT TYPES COMONOMER TYPESBUTENE HEXENE OCTENE

PLANTS (REACTORS) CATALYSTS ADDITIVES AND FILLERS END USE MARKETS SERVED SUPPLY/DEMAND RELATIVE PROFITABILITY

POLYETHYLENE SUPPLY CHAINCRUDE OIL NATURAL GAS

DISTILLATION UNITSNaphtha Ethane Propane

Propylene

STEAM CRACKEREthylene

Fuels

POLYMERIZATION PLANTSPOLYETHYLENE

FABRICATION PLANTS END USERS

POLYPROPYLENEPRODUCT TYPES COMONOMERS– ETHYLENE – BUTENE

CATALYSTS ADDITIVES AND FILLERS END USE MARKETS SERVED (APC) SUPPLY/DEMAND RELATIVE PROFITABILITY

POLYPROPYLENE SUPPLY CHAINCRUDE OIL NATURAL GAS

DISTILLATION UNITSNaphtha, Propane, etc.

STEAM CRACKER EthylenePropylene 69%

FCCPropylene 29%POLYPROPYLENE

Fuels Alkylation Units

POLYMERIZATION UNITS FABRICATION PLANTS CONSUMERS

ON PURPOSE PROCESSESPROPANE DEHYDROGENATION METATHESIS DEEP CATALYTIC CRACKING METHANOL TO OLEFINS (Not Commercial)

PROPYLENE MARKETSPRODUCT POLYPROPYLENE ACRYLONITRILE OXY ALCOHOL CUMENE PROPYLENE OXIDE OTHER PRODUCTS TOTAL – 2000 Percentage of Total Production 2000 2000-2004 Forecasted Growth Rate (1)

57% 11% 8% 6% 7% 11% 51.2 MM Tons

6.7% 4.3% 6.2% 4.4% 4.3% -5.6%

(1) Petroleum Technology Quarterly 2001, page 132

POLYSTYRENEPRODUCT TYPES TYPE RUBBER TYPE PLANT ADDITIVES AND FILLERS END USE MARKETS SERVED SUPPLY/DEMAND RELATIVE PROFITABILITY

POLYSTYRENE SUPPLY CHAIN (SIMPLIFIED)ETHYLENE BENZENE SYTRENE MONOMER PRODUCTIONSTYRENE MONOMER RUBBER

POLYMERIZATIONPOLYSTYRENE

FABRICATION PLANTS

CONSUMERS

CONCLUSIONS1. 2.

THE ECONOMY IS IMPROVING TO IMPROVE PROFITABILITY A. REDUCE OVERCAPACITIES A. SHUT DOWN NON-COMPETITIVE PLANTS B. BUILD ONLY LARGE ECONOMICAL PLANTS BASED ON GOOD MARKET RESEARCH B. SHIFT PRODUCT LINES FROM SPECIALTIES TO BASE GRADES PLUS ADDITIVES

CONCLUSIONS2.

TO IMPROVE PROFITABILITY C. IMPROVE PROCESS/PRODUCTS D. IMPROVE IMAGE E. ENCOURAGE EDUCATION F. DEAL WITH CHANGING REGIONAL MARKET DEMANDS

INDUSTRY PROBLEMSVOLUNTEERISM INDUSTRY ORGANIZATIONS

SPEPEOPLE

SPIEQUIPMENT MANUFACTURERS, FABRICATORS

APCRESIN SUPPLIERS

BUSINESS ETHICS