METI
Font Size Change
S
M
L
Easy Web Browsing tool

Forecast of Global Supply and Demand Trends for Petrochemical Products (for the 2007-2020 period) Compiled

The Study Group on Global Supply and Demand Trends for Petrochemical Products (secretariat: Material Industries Division, Manufacturing Industries Bureau, Ministry of Economy, Trade and Industry) has completed a study on trends up to the year 2020 in global demand for and supply of petrochemical products, such as ethylene derivatives, propylene derivatives, and aromatic products (demand and production capacity, and volume).

1. Trends in the coal chemical industry in China

  1. Regarding coal chemical projects in China, it is expected that 18 projects (equivalent to 5.85 million tons of ethylene), including those already started, out of the nearly 50 publicized projects (equivalent to about 17 million tons of ethylene) will start by the end of 2017. However, it is difficult to predict how many projects will be actually carried out from 2018 due to the delay of the start-up date for the projects by about a year as a whole caused by the influence of a plunge in crude oil prices and other factors.
  2. The production capacity for ethylene is expected to increase to 31 million tons in 2020 from 21 million tons in 2014 through the plans to accelerate production to construct new and additional facilities including naphtha crackers.
  3. Concerning propylene, the government of China has increased new projects on propane dehydrogenation (PDH), and the production capacity for propylene including methanol to propylene (MTP) is expected to increase to 37 million tons in 2020 from 24 million tons in 2014.

2. Possible influence of the shale gas revolution in the U.S.

  1. Projects for new and additional facilities to produce ethylene derived from shale gas have been affected by the decrease in competitive advantages due to the decrease in crude oil prices and by the rise in construction costs. However, shale gas still has an absolute price advantage over naphtha.
  2. According to the study in 2015, the start-up dates of ethylene plants have been delayed. However, according to the study in 2016, the start-up dates of such plants are being brought forward on the whole, and the production capacity for ethylene is expected to continue exceeding 10 million tons, reaching a peak in 2017 or 2018. As a result, the production capacity for ethylene will increase to 34 million tons in 2020 from 27 million tons in 2014.

3. Global demand

  1. The annual growth rate of global demand in ethylene derivatives from 2014 to 2020 is expected to be 3.6% on average (actual annual growth from 2007 to 2014 was 2.2% on average) since Asia is expected to continue driving the increase in global demand, while the growth rate in East Asia shows downward trends.
  2. The annual growth rate of global demand in propylene derivatives from 2014 to 2020 is expected to be 4.3% on average (actual annual growth from 2007 to 2014 was 2.6% on average). Asia is expected to continue driving the increase in global demand in the derivatives. However, the increase in demand might remain small if the economic growth rate in the region becomes sluggish.

4. Key points of supply-demand balance for each petrochemical product

  1. Regarding the supply-demand balance for ethylene derivatives, the production capacity in China is expected to increase as the petrochemical industry grows and the excess demand is expected to reach 22 million tons by 2020 (16 million tons in 2014), while the demand is anticipated to increase more rapidly than production. On the other hand, looking at the Middle East, the excess supply of ethylene derivatives is expected to reach 22 million tons by 2020 (16 million tons in 2014) due to the specific plans for constructing new ethylene plants in Iran. In North America, the excess supply of ethylene derivatives is expected to reach 8.1 million tons in 2020 (6.7 million tons in 2014).
  2. Regarding the supply-demand balance for propylene derivatives in China, since the excess demand for propylene derivatives reached 5.2 million tons in 2014, the excess demand is expected to decrease to 5 million tons in 2020 along with the progress in PDH projects and other activities.

Note: Concerning the future supply-demand balance for petrochemical products, it should be fully noted that the situation may change according to future world economic trends and increases in the number of plants.

Release date

July 8, 2016

Division in Charge

Material Industries Division, Manufacturing Industries Bureau

Ministry of Economy, Trade and Industry1-3-1 Kasumigaseki, Chiyoda-ku, Tokyo 100-8901, Japan Tel: +81-(0)3-3501-1511
Copyright Ministry of Economy, Trade and Industry. All Rights Reserved.