PTT Polymer Marketing Company Limited Current PE market situation and production capacity outlook 1 20 April 2017 Proprietary information of PTT Polymer Marketing Co., Ltd.
PTT Polymer Marketing Company Limited
Current PE market situation and
production capacity outlook
1
20 April 2017
Proprietary information of PTT Polymer Marketing Co., Ltd.
2
PTT Group Value Chain
The biggest integrated petrochemical and refining complex in Thailand
Exploration &
Production
Crude Oil
Procurement
Olefins & Aromatic
Plants
Palm Plantation
Coal Mining
Pipeline
Trading
Petrochemical
Intermediate Plants
Biodiesel, Ethanol
Plants
Gas Separation
Plants
Logistics
Refineries
Power Plants
Industry
NGV
Oil
LPG
Lube Base Plant
Plastic Resins
Electricity
District Cooling
System
PTT Stations
Transportation
Household
Lubricant
End Product
Export Market
Gasohol (E10/E20/E85)
Biodiesel
PTTEP PTTNGD, TTTLNG
Thai Oil,
PTTGC,
SPRC,
BCP
PTTIT
PTTUT, CHPP
PTTRB
TLBC, IRPC
PTT tank
IRPC
HMC
PTTAsahi, PTTGC
IRPC, PPCL
PTTGC, IRPC,
TPX,
PTTGE
PTTGC, Thai Oil, BCP PTTIT
Upstream Intermediate Downstream End customers
Ga
s C
ha
in
Oil
Ch
ain
P
etr
och
em
ica
l
Ch
ain
N
ew
Bu
sin
ess
Proprietary information of PTT Polymer Marketing Co., Ltd.
Manufacturing Unit
Sales & Marketing Arm
Logistics Provider
PTT Group Value Chain Fully Integrated Polymer Business Chain
3 Proprietary information of PTT Polymer Marketing Co., Ltd.
2005 2015
HDPE HDPE HDPE HDPE HDPE HDPE
PP PP PP PP PP
PS PS PS PS PS
LLDPE LLDPE LLDPE LLDPE
LDPE LDPE LDPE LDPE
ABS ABS ABS
PLA
PBS
PLA
PBS
PLA
PBS
PC PC
PMMA PMMA
PET
HDPE
PP
PS
LLDPE
LDPE
ABS
PLA
PBS
PC
PMMA
PET
2007 2008 2009 2010 2012
Purging Compound
PTTPM Product Portfolio Continuously Grow to service more customers
4 2016
PVC
HDPE
PP
PS
LLDPE
LDPE
ABS
PLA
PBS
PC
PMMA
PET
Purging Compound
PVC
Lubricant
LLDPE 400KT
LDPE 300KT
HDPE 800KT
- 5 -
EXPORT MORE THAN 100 COUNTRIES
Proprietary information of PTT Polymer Marketing Co., Ltd.
+LLDPE 400KT
6
AGENDA
Consumer trends affecting the polymer sector
Market review and global outlook for PE
New supply and the influence on market and trading dynamics supply and the influence on market and trading dynamics
Key Takeaways
Proprietary information of PTT Polymer Marketing Co., Ltd.
7
AGENDA
Consumer trends affecting the polymer sector
Market review and global outlook for PE
New supply and the influence on market and
trading dynamics
Key Takeaways
Proprietary information of PTT Polymer Marketing Co., Ltd.
HDPE 17%
LLDPE 12%
LDPE 9%
PP 26%
PS 4%
EPS 2%
ABS 3%
PVC 17%
PET 8%
PC 2%
8 Source: WA 2016
World Polymer Demand PE accounts nearly for 40% of total polymer demand
2016 World Demand by Major Polymers
243 Million Metric Tons
5.2%
Proprietary information of PTT Polymer Marketing Co., Ltd.
9 Source: WA 2016
World Polymer Demand PE mostly consumed in Film and Sheet application
Film & Sheet, representing over 50% of total global PE consumption
World PE Demand by Application
Film & Sheet 53%
Injection Molding
13%
Pipe & Profile 7%
Extrusion Coating
2%
Blow Molding 12%
Wire & Cable 2%
Rotomolding 2%
Fiber 1%
Raffia 1%
Other 7%
2016 Total World PE Demand 92 Million Metric Tons
Proprietary information of PTT Polymer Marketing Co., Ltd.
10 Source: WPC 2015
World PE Demand Mostly consumed in Indian sub, NEA, showing strong demand growth
Y2017 = 95 Million MT Y2022 = 117 Million MT +4% CAGR
33
16 14
8 6 6 5 4 3
43
18
15
10 9 8 6 5
3
5%
2%
1%
5%
9%
4%
3%
4%
3%
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
0
10
20
30
40
50
60
70
80
NEA N.America Europe SEA Indian Sub. MiddleEast
S.America Africa CIS & BalticStates
Million MT
Sum of 2017 Sum of 2022 %CAGR
Proprietary information of PTT Polymer Marketing Co., Ltd.
NEA 37%
N.America 16%
Europe 13%
SEA 8%
Indian Sub. 7%
Middle East 7%
S.America 5%
Africa 4%
CIS & Baltic States
3%
2022
11 Source: WA 2016
World PE Capacity Mostly located in 3 regions: N. America, NEA and Middle east
+3% CAGR
Majority of new PE capacity additions in the next 5 years will be concentrate in
2 regions, North America and North East Asia
Y2017 = 113 Million MT Y2022 = 133 Million MT
3 9 24 28 22 2 5 2 4
6
12
29
34
24
2
6
2 4
16%
5% 5% 4%
2% 2%
1% 0% 0% 0
5
10
15
20
25
30
35
40
CIS & BalticStates
SEA N. America NEA Middle East CentralEurope
Indian Sub. Africa S. America
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
%CAGR Million MT
2017 Capacity
2022 Capacity
Capacity Growth (%CAGR)
Proprietary information of PTT Polymer Marketing Co., Ltd.
12 Source: WPC 2015
World PE Net Trade Flow 2022 N. America will expand its exports into Asia
North America & the Middle East are the two significant net exporting regions
12.9 14.1 4.6 9.1
-0.5
2
0.3 0.0
-0.8 -1
-1.7 -2.4
-2.7 -3.4
-1.6 -2.4
-9.6 -13.5
Net Exporters
Net Importers
Proprietary information of PTT Polymer Marketing Co., Ltd.
13
AGENDA
Consumer trends affecting the polymer sector
Market review and global outlook for PE
New supply and the influence on market and
trading dynamics
Key Takeaways
Proprietary information of PTT Polymer Marketing Co., Ltd.
Source :Global Economic Outlook (Mar 2016), Bureau of Labor Statistics (Mar 2016)
Hard Landing? 4-5% GDP Growth
7.4 7.5
7.1 7.2 7.0 7.0 6.9 6.8 6.7 6.7 6.7 6.8
2014Q1
2014Q2
2014Q3
2014Q4
2015Q1
2015Q2
2015Q3
2015Q4
2016Q1
2016Q2
2016Q3
2016Q4
China GDP Growth (Quarterly Growth, %)
14
China Economics Concerned of slow down
Agriculture 8%
Industry 41%
Services 51%
2016 GDP Composition
50
Proprietary information of PTT Polymer Marketing Co., Ltd.
Services Technology
Domestic Consumptions
China Economics Demand still Grow Continuously with some changes
15
NEW KEY
To CHINESE GROWTH
Proprietary information of PTT Polymer Marketing Co., Ltd.
Although new local CTO-based plants started, China’s import volume almost hit
10 Million tons due to increasing local demand.
4.0
4.7 4.6
5.1 5.3
2.3 2.4 2.5 2.6 2.6
1.6 1.7 2.1 2.2 2.1
7.9 8.8 9.1
9.9 9.9
0
2
4
6
8
10
12
0
1
2
3
4
5
6
7
8
Y2012 Y2013 Y2014 Y2015 Y2016
Mil
lio
ns M
T
Mil
lio
ns M
T HDPE LLDPE LDPE Total PE
16
+3%
China PE Import Demand Still increase continuously
Source: National Bureau of Statistics of China Proprietary information of PTT Polymer Marketing Co., Ltd.
Cost & Volume Reduction
Energy & Water Efficiency
Recyclability
Global Megatrends Cause PE Demand to rise
Source : Townsend, PTTPM
19
Environmental Concerns
Health & Wellness
Aging Population
Safety
Convenient Time
Global Megatrends
Plastic Key Advantages
Market-Driven
Environmentalism & Sustainability Driven
Proprietary information of PTT Polymer Marketing Co., Ltd.
Source : Euromonitor International Ltd 2015 : GLOBAL PACKAGING LANDSCAPE: GROWTH, TRENDS & INNOVATIONS
Healthy Life
Exercise Regularly
Eat Healthy
Drink plenty of
Water
Reduce Stress
Health & Wellness Trend Lead to lifestyle and consumption changes
Eat Healthy
20
Intelligent packaging
Proprietary information of PTT Polymer Marketing Co., Ltd.
Source : Euromonitor International Ltd 2015 : GLOBAL PACKAGING LANDSCAPE: GROWTH, TRENDS & INNOVATIONS
Healthy Life
Exercise Regularly
Eat Healthy
Drink plenty of
Water
Reduce Stress
Produced from InnoPlus
HD2200JP, high quality with
excellent organoleptic property.
Listed in well known beverage
brand owner.
Health & Wellness Trend Lead to lifestyle and consumption changes
Drink plenty of
Water
Shrink film produced from InnoPlus LD2420D and LL7910A/7903A/7905A 21
Health & Wellness Trend Greater consumer awareness of health and wellness
Source : Euromonitor International Ltd 2015 : GLOBAL PACKAGING LANDSCAPE: GROWTH, TRENDS & INNOVATIONS
Healthy Life
Exercise Regularly
Eat Healthy
Drink plenty of
Water
Reduce Stress
Exercise Regularly
Reduce Stress
22
Sport equipment
Proprietary information of PTT Polymer Marketing Co., Ltd.
Source : Euromonitor International Ltd 2015 : GLOBAL PACKAGING LANDSCAPE: GROWTH, TRENDS & INNOVATIONS
Cost &Volume Effectiveness with Performance Result in changes of packaging design, creating more opportunity for plastics
23 Proprietary information of PTT Polymer Marketing Co., Ltd.
Stretch film produced from InnoPlus LL7835A / LL8420A
24
v n
Cost &Volume Effectiveness with Performance Result in changes of packaging design, creating more opportunity for plastics
Proprietary information of PTT Polymer Marketing Co., Ltd.
Cost &Volume Effectiveness Light-weight product trend in construction industry
Source : Euromonitor International Ltd 2015 : GLOBAL PACKAGING LANDSCAPE: GROWTH, TRENDS & INNOVATIONS
Plastic Tank
(LLDPE C6 Rotomolding Tank)
The comparatively low cost, lighter weight and ease of installation of plastic material provides more advantages.
Stainless Tank
Produced from InnoPlus LL9640UP/9641UP
25 Proprietary information of PTT Polymer Marketing Co., Ltd.
Source : Euromonitor International Ltd 2015 : GLOBAL PACKAGING LANDSCAPE: GROWTH, TRENDS & INNOVATIONS
AUTOMOTIVE
Light-weight materials are common needs
26
Cost &Volume Effectiveness Light-weight product trend in automotive industry
Produced from InnoPlus LL8420A
Proprietary information of PTT Polymer Marketing Co., Ltd.
Packaging
Source : IHS (2016) 27
Food & Beverage
Pharmaceuticals
Convenient Time & Safety Thanks to More middle class, aging population & urbanization
Water saving plastic
Retort Pouch
Polyolefin laminated container
High performance down-gauging film
Easy Handling
Convenience and Universal Design
Shelf-life indicator packaging
Multi-layered
Required High
Quality and Strict Hygiene!!
Proprietary information of PTT Polymer Marketing Co., Ltd.
28
Environmentalism & Sustainability Driven Lead to Green-related production
36% sugarcane-based PE bag for organic bread
Bio-Based plastic
Bioplastic coated cup and laminated packaging pouch
Green PE packaging
Bio-composability plastic
Proprietary information of PTT Polymer Marketing Co., Ltd.
29
AGENDA
Consumer trends affecting the polymer sector
Market review and global outlook for PE
New supply and the influence on market and
trading dynamics
Key Takeaways
Proprietary information of PTT Polymer Marketing Co., Ltd.
Key Takeaways
30
Global PE demand still healthy and continuously
growth, especially driven by Packaging Industry
PE Capacities to accelerate in the next 5 years,
mainly from USA and China.
China PE market demand moderately grow along with
the steadily economic growth.
There are lots of opportunities from new market
trends and robust additional capacities. Developing
and adopting quickly are the key to seizing benefits
from dynamic business world.
Proprietary information of PTT Polymer Marketing Co., Ltd.
32
www.pttpm.com
www.facebook.com/PTTPM
www.youtube.com/user/PTTPolymer
@pmsolution
Proprietary information of PTT Polymer Marketing Co., Ltd.