Sabic sees Asian petchems demand surge

Asian demand for petrochemicals is expected to exceed the combined demand of the United States and Europe within two years, Saudi Basic Industries (Sabic) said on Monday.

Petrochemicals producers in the Middle East, where cheap access to energy encouraged large investment in the industry, will benefit from the expected demand surge, said Sabic Chief Executive Mohamed Al Mady.

"Growth in global demand was a catalyst for growth in these industries, especially in China and Pacific Asia ... where demand is the expected to exceed within two years its level in the United States and Europe put together," he told a conference.

Output from the Middle East will account for 17 per cent of global output by the end of 2010 against 10 per cent at the beginning of 2000, said Mady, whose firm is the world's largest petrochemical company by market value.

"Growth in global demand was as fast as growth in production capacities," he said.

Demand in China is growing at an annual 10 per cent for polyolefins, at nine per cent for high-density polyethylene, 12 per cent for low-density polyethylene and 10 per cent for polypropylene, Mady said.

Sabic expects its polyethylene exports to reach 10 million tonnes by the end of 2010, which is 120 per cent above its level in 2004, Mady added.

Asia is expected to take 80 per cent of the polyethylene exports, Mady said without giving comparative figures.

Sabic, the world's fourth-largest producer of polyolefins, hoped to become the second-largest in 2015, said Mady. Sabic is the third-largest producer of polyethylene and fourth-largest polypropylene producer. (Reuters)