Chemical Market Associates, Inc. (CMAI) has completed a study on world Cumene/Phenol & Polycarbonate Analysis. The analysis comprises eleven years of study: five years of history, the current year, and five years of forecast. Some key issues examined in this analysis include
Cumene Supply
Prices remain very high due to the elevated values for raw materials. Benzene supply restrictions have eased but the extremely high energy prices have not allowed benzene values to ease in line with additional supply. Propylene also remains very expensive, largely due to energy. Although availability has improved, CMAI experts anticipate that benzene and propylene supply will largely dictate investments. A trend has developed such that new phenol units are backward integrated to cumene with some having further integration to benzene and/or propylene.
Phenol Overview
The global phenol market has remained tight due to delays in expansions in Europe along with a series of operating issues while demand has remained relatively healthy. Additional capacity should be on line by early 2008, which will help alleviate some of the tightness. Asia has clearly been the driver for global growth. This is expected to continue as Asia is where most of the downstream expansions are taking place. The strength in Asia's output will generate fairly significant trade flows. Polycarbonate Overview
Polycarbonate has been and will continue to be one of the key drivers for phenol demand growth. Therefore, investments for precursors are being dictated by the location of new PC units, which tend to be in Asia, as this is where the majority of demand growth is expected. We believe that trade patterns will experience some shifting with the addition of the new Kayan unit in Saudi Arabia, whose product will mainly be destined for export. Overall, demand for PC is projected to remain healthy despite a slowdown in growth in certain key sectors.
Cumene Supply
Prices remain very high due to the elevated values for raw materials. Benzene supply restrictions have eased but the extremely high energy prices have not allowed benzene values to ease in line with additional supply. Propylene also remains very expensive, largely due to energy. Although availability has improved, CMAI experts anticipate that benzene and propylene supply will largely dictate investments. A trend has developed such that new phenol units are backward integrated to cumene with some having further integration to benzene and/or propylene.
Phenol Overview
The global phenol market has remained tight due to delays in expansions in Europe along with a series of operating issues while demand has remained relatively healthy. Additional capacity should be on line by early 2008, which will help alleviate some of the tightness. Asia has clearly been the driver for global growth. This is expected to continue as Asia is where most of the downstream expansions are taking place. The strength in Asia's output will generate fairly significant trade flows. Polycarbonate Overview
Polycarbonate has been and will continue to be one of the key drivers for phenol demand growth. Therefore, investments for precursors are being dictated by the location of new PC units, which tend to be in Asia, as this is where the majority of demand growth is expected. We believe that trade patterns will experience some shifting with the addition of the new Kayan unit in Saudi Arabia, whose product will mainly be destined for export. Overall, demand for PC is projected to remain healthy despite a slowdown in growth in certain key sectors.
