Global Polyethylene demand predicted to reach 113m tonnes by 2020, says IHS

An abundance of affordable shale gas feedstock in North America, coupled with accelerating demand for consumer goods in China and India, will maintain growth for polyethylene makers, according to IHS Markit in America.

Current global demand for polyethylene is 92 megatonnes, but IHS Markit believes demand growth will increase by 21 megatonnes by 2021, to 113 megatonnes. IHS reports: “As more people’s incomes rise globally, they become consumers of more plastic goods and wrapping film. Film applications, key to the packaging sector, are the world’s most important plastics use, representing more than 60 per cent of plastics demand.”

As both supply and demand increase, big plastic producers are enlarging operations in North America. Exxon Mobil will expand PE operations at its Texan plants in Beaumont and Mont Belvieu, facilities that together make more than 2 megatonnes of polyethylene. ChevronPhillips Chemical is adding a million tonnes in new capacity this year and Dow Chemical will make 900,000 more tonnes of polyethylene in 2017.

Joel Morales, IHS Markit Senior Director of Polyolefins Americas, said “Countries with large populations and expanding economies, such as China, India and Indonesia, have tremendous future growth potential.”

“India currently consumes about 4 kilograms of PE per person, and we expect that to increase significantly during the next 25 years. China leads East Asia in consumption demand for PE, with domestic consumption expected to increase nearly 10 megatonnes by 2021, which accounts for more than half of the entire global demand. China drives 97 per cent of PE demand growth in East Asia. The global polyethylene market is experiencing very strong growth as there is nothing bigger than PE when it comes to packaging materials.”