PTT Group Addresses Long-term Petrochemical Oversupply

MGR Online•Economy•15h ago

Reader Briefing

PTT Group reports a long-term oversupply in the olefins and aromatics petrochemical sectors driven by new production capacity from China and the Middle East.

•China and the Middle East are increasing production capacity, leading to a petrochemical market oversupply lasting several years.
•Thai operators are importing ethane to reduce costs and seeking new export markets in Africa and India.
•Chinese product imports into Thailand have increased, specifically affecting plastic boxes (76%) and general products (31%).
•The Polyethylene (PE) and Polypropylene (PP) markets face production pressure expected to last until 2030.

Overview

•The petrochemical industry faces oversupply in olefins and aromatics due to new capacity from China and the Middle East.
•Production of plastic drinking water containers and electronics in Thailand grew by 12.4% in the first half of the year, while plastic film growth declined by nearly 23%.
•Chinese imports have increased by 31% overall and 76% for plastic boxes, impacting Thai manufacturing.
•Polyethylene (PE) demand is projected to grow by 6.8% in South Asia and 4.1% in Southeast Asia, particularly in Indonesia and Vietnam, between 2027-2030.
•Polypropylene (PP) has been in a state of oversupply from 2021-2028 and is expected to recover slightly by 2030.
•Thai operators are importing ethane on a long-term basis and focusing on high-value products to maintain cost competitiveness.
•Thananya Songchu of Thai Oil reports that the aromatics market is highly volatile, with China adding 9.5 million tons of capacity over the next 5 years.
•Operators are targeting new markets in Africa and India and diversifying into the semiconductor industry using solvents.

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Key Entities

Organization

PTT Group(กลุ่มปตท.)

A group pointing out the long-term oversupply trends in the petrochemical industry.

PTT Global Chemical Public Company Limited(บริษัท พีทีที โกลบอล เคมิคอล จำกัด (มหาชน))ℹ️

An organization whose analyst, Pimpamon Chulchaown, provided data on the polyolefins market.

Thai Oil Public Company Limited(บริษัท ไทยออยล์ จำกัด (มหาชน))

An organization whose analyst, Thananya Songchu, provided data on the aromatics market.

PRISM Experts

An entity involved in the 17th PTT Group Petrochemical Outlook Forum.

Person

Pimpamon Chulchaown(พิมพ์กมล จุลเชาวน์)

An analyst from PTT Global Chemical Public Company Limited.

Thananya Songchu(ธนัญญา สงชู)

An analyst from Thai Oil Public Company Limited.

Place

China(จีน)ℹ️

A country increasing petrochemical production capacity and exporting products to Thailand.

Middle East(ตะวันออกกลาง)ℹ️

A region increasing petrochemical production capacity.

Africa(แอฟริกา)ℹ️

A target export market for Thai petrochemical operators.

Indonesia(อินโดนีเซีย)ℹ️

A country in Southeast Asia with increasing consumption and demand for Polyethylene.

Vietnam(เวียดนาม)ℹ️

A country in Southeast Asia with increasing consumption and demand for Polyethylene.

India(อินเดีย)ℹ️

A country with high demand for Paraxylene and aromatics.