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PVC in Eastern Europe Special market report 2006 www.mrcchemical.com PVC in Eastern Europe – 2006 RESUME…............................................................................................................... 6 DEFINITIONS IN THE REPORT................................................................................ 7 1. MACROECONOMIC INDEXES OF EASTERN EUROPEAN COUNTRIES ................... 11 2. PVC MARKET: WORLD TRENDS ......................................................................... 19 2.1. World PVC Market .................................................................................. 19 2.2. Asian PVC Market................................................................................... 27 2.3. PVC Market in Western Europe ................................................................ 28 3. PVC MARKET IN EASTERN EUROPE ................................................................... 32 3.1. General Market Trends ........................................................................... 32 3.2. Consumption of PVC in Eastern European Countries .................................. 35 3.3. Production of PVC by Countries of Eastern Europe ...................................... 46 3.4. Export of PVC by Countries of Eastern Europe............................................ 49 3.5. Import of PVC by Countries of Eastern Europe ........................................... 51 3.6. The Balance of the VCM Market in Eastern Europe...................................... 53 3.7. The Balance of the Chlorine and Caustic Markets in Eastern Europe.............. 57 а) Chlorine..............................................................................................57 b) Caustic ...............................................................................................61 4. PVC MARKET BY COUNTRIES OF EASTERN EUROPE .......................................... 32 4.1. Poland ................................................................................................ 65 4.1.1. The General Economic Situation ........................................................65 4.1.2. Consumption of PVC ........................................................................68 а) Profile Market ......................................................................................71 b) Pipe Market .........................................................................................72 c) Other Markets......................................................................................73 4.1.3. Production of PVC ...........................................................................73 4.1.4. The Balance of the VCM, Ethylene, Chlorine and Caustic Markets............75 4.2. Hungary.............................................................................................. 78 4.2.1. The General Economic Situation ........................................................78 4.2.2. Consumption of PVC ........................................................................80 а) Profile Market ......................................................................................83 b) Pipe Market .........................................................................................83 4.2.3. Production of PVC ...........................................................................84 4.2.4. The Balance of the VCM, Ethylene, Chlorine and Caustic Markets............87 4.3. Romania ............................................................................................. 91 4.3.1. The General Economis Situation ........................................................91 4.3.2. Consumption of PVC ........................................................................92 а) Profile Market ......................................................................................94 b) Pipe Market ........................................................................................94 4.3.3. Production of PVC ...........................................................................96 4.3.4. The Balance of the VCM, Ethylene, Chlorine and Caustic Markets............99 4.4. The Czech Republic........................................................................... 103 4.4.1. The General Economic Situation ...................................................... 103 4.4.2. Consumption of PVC ...................................................................... 105 4.4.3. Production of PVC ......................................................................... 107 4.4.4. The Balance of the VCM, Ethylene, Chlorine and Caustic Markets.......... 109 4.5. Slovakia............................................................................................ 111 4.5.1. The General Economic Situation ...................................................... 111 4.5.2. Consumption of PVC ...................................................................... 112 4.5.3. Production of PVC ......................................................................... 114 4.5.4. The Balance of the VCM, Ethylene, Chlorine and Caustic Markets.......... 114 © www.mrcchemical.com 2 PVC in Eastern Europe – 2006 4.6. Former Yugoslavia……………….……………………………………….……………………116 4.6.1. The General Economic Situation ………………………………………………………………………………116 4.6.2. Consumption of PVC …………………………………………………………………………………………………119 4.6.3. Production of PVC ……………………………………………………………………………………………………121 4.6.4. The Balance of the Chlorine and Caustic Markets …………………………………………………124 4.7. Bulgaria……………………………….……………………..……………….…………………..127 4.7.1. The General Economis Situation ………………………………………………………………………………127 4.7.2. Consumption of PVC …………………………………………………………………………………………………128 4.7.3. Production of PVC………………………………………………………………………………………………………130 4.7.4. The Balance of the VCM, Ethylene, Chlorine and Caustic Markets …………………………131 4.8. Baltic Countries……………………………………………………………..…………………..133 4.8.1. The General Economic Situation ………………………………………………………………………………133 а) Latvia ………………………………………………………………………………………………………………………………134 б) Lithuania …………………………………………………………………………………………………………………………135 в) Estonia………………………………………………………………………………………………………………………………136 4.8.2. Consumption of PVC …………………………………………………………………………………………………137 4.8.3. Production of PVC………………………………………………………………………………………………………139 4.8.4. The Balance of the Chlorine and Caustic Markets……………………………………………………139 4.9. The Republic of Belarus………………………………………..……….……………………140 4.9.1. The General Economic Situation ………………………………………………………………………………140 4.9.2. Consumption of PVC …………………………………………………………………………………………………142 4.9.3. Production of PVC………………………………………………………………………………………………………143 4.9.4. The Balance of the Chlorine and Caustic Markets……………………………………………………143 4.10. Turkey……………………………………………………………………….……………………144 4.10.1. The General Economic Situation ……………………………………………………………………………144 4.10.2. Consumption of PVC ………………………………………………………………………………………………146 4.10.3. Production of PVC……………………………………………………………………………………………………150 4.10.4. The Balance of the VCM, Ethylene, Chlorine and Caustic Markets ………………………152 5. INFLUENCE OF OTHER REGIONS ON PVC MARKET OF EASTERN EUROPE……..154 5.1. Iran ………………………………………………………………………………………………………………………………155 5.2. China ……………………………………………………………………………………………………………………………158 5.3. South Korea …………………………………………………………………………………………………………………165 APPENDIX……………………………………………………………………………………………….167 © www.mrcchemical.com 3 PVC in Eastern Europe – 2006 This market report includes consumption, production and export-import analysis of PVC, VCM, Chlorine and Caustic in all countries of Eastern Europe. Report provides the data from 2000 to 2005 as well as market forecast for 2010. Report was prepared by analysts of Harriman Chemsult and Market Report Company (MRC). We would like to present you the up-to-date PVC market report with aggregated data about sixteen Eastern European countries. Besides additional data on Russia, Turkey, Iran, China, South Korea and Japan are presented. There is the detailed analysis of trends in consumption markets and presentation of activity of the largest producers and consumers. We estimated the prospects of PVC consumption in each country of Eastern Europe up to 2010. Separately we have analyzed the consumption, production and export-import of VCM, ethylene, chlorine and caustic in each country as well. There is a detailed description of each PVC producer according to its production balance (VCM, ethylene and chlorine availability, caustic sales ability). We have analyzed the Asian region to understand its influence on PVC market in Eastern Europe in the nearest future. In particular, the market situation and development trends in China, its influence on possible deliveries of PVC from South Korea, Taiwan and Japan. In the report, you can also find answers for the following questions: ¾ What is PVC, Chlorine and Caustic consumption level in each country of Eastern Europe? How will these markets develop until 2010? ¾ Which PVC processing sectors will be the most perspective in Eastern Europe? ¾ How will profile, pipes, flooring and films markets develop in Poland, Hungary, Czech Republic, Slovakia and Romania? ¾ What is PVC consumption growth potential in Turkey? How will the declared PVC projects in Iran influence on Eastern European producers positions in Turkey? ¾ Will VCM delivery balance be broken because of PVC production input in Kalush? ¾ Why were the PVC productions in Tarnow, Oswiecim and Dwory closed? Will PVC productions in Pancevo and Devnya be reanimated or not? ¾ What are Dioki perspectives to renew the VCM capacities by 2008-2009? ¾ How well are PVC/VCM/Chlorine/Caustic productions in BorsodChem, Anwil, Oltchim, Spolana, NCHZ, Petkim balanced? ¾ How will the chlorine and caustic markets develop in each country of Eastern Europe? Which exactly companies are the biggest chlorine/caustic consumers in these countries? ¾ What is the role of China for the nearest years - PVC importer or exporter? ¾ Where will Japan, South Korea, Taiwan redirect their PVC export deliveries during the next three-five years? Statistics of report: 187 pages, 133 tables, 215 diagrams, 31 355 words, 204 companies mentioned, 20 appendixes Format: PDF file or color paper version. Contact [email protected] 4 © www.mrcchemical.com PVC in Eastern Europe – 2006 List of tables 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50. 51. 52. 53. 54. 55. 56. 57. 58. 59. 60. 61. 62. 63. 64. 65. 66. 67. Construction volumes in EE, mln. sq. m Construction volumes growth in countries of Eastern Europe, % The world PVC demand, 2003 The world PVC market, КТ PVC-paste world balance, 2004, КТ The World biggest producers of PVC-S and PVC-paste, 2004 The World PVC-E capacity expansion, КТа The World trade balance of PVC-Е , 2010, КТ PVC demand distribution in Asia, 2004 PVC consumption in Western Europe , 2003-2004, КТ PVC market in Western Europe, 2003-200, КТ PVC market indexes in Western Europe, 2003-2005, КТ Real PVC consumption increase in countries of EE PVC consumption in countries of Eastern Europe, MT PVC pipe market in Eastern Europe, КТ Polymers use for pipe production PVC production in countries of Eastern Europe, КТ PVC capacities in countries of Eastern Europe, КТа PVC capacity loading in countries of Eastern Europe, % PVC export from Eastern Europe, MT Export share in PVC production, MT PVC import into countries of Eastern Europe, MT Import share in PVC consumption, MT VCM capacities in countries of Eastern Europe, MT VCM export-import in countries if Western Europe, 2005, КТ Chlorine import into countries pf EE, MT Chlorine export from countries of EE, MT Caustic import into countries of EE, MT Caustic export form countries of EE, MT Macroeconomic indexes of Poland New capacities in polymers production until 2010 PVC market in Poland, MT Some PVC articles production in Poland, MT Window profile production in Poland, 2004, mln. USD Pipe producers in Poland, 2004, mln. USD Flooring producers in Poland, 2004, mln. USD PVC production in Poland, MT PVC compounds production in Poland, 2000-2004, MT Chlorine market in Poland, MT Caustic consumption in Poland by branches, КТ Chlorine/caustic capacities in Poland, КТ Caustic market in Poland, MT Caustic consumption in Poland by branches, КТ Macroeconomic indexes of Hungary PVC market in Hungary, MT Consumption of PVC-S for articles production, Hungary, MT BorsodChem capacities, КТа PVC production in Hungary, т PVC compounds production in Hungary, 2000-2004, MT Chlorine market in Hungary, MT Chlorine consumption in Hungary by branches, КТ Chlorine/Caustic capacities in Hungary, КТ Caustic market in Hungary, MT Caustic consumption in Hungary by branches, КТ Chlorine/ Caustic capacities in Hungary, КТ Caustic market in Hungary, MT Caustic consumption in Hungary by branches, КТ Macroeconomic indexes of Hungary PVC market in Romania, MT PVC-S deliveries, Oltchim production, MT Oltchim capacities, КТа Chlorine market in Romania, MT Chlorine consumption in Romania by branches, КТ Chlorine/ Caustic capacities in Romania, КТ Caustic market in Romania, MT Caustic consumption in Romania by branches, КТ Macroeconomic indexes of Czech Republic 68. 69. 70. 71. 72. 73. 74. 75. 76. 77. 78. 79. 80. 81. 82. 83. 84. 85. 86. 87. 88. 89. 90. 91. 92. 93. 94. 95. 96. 97. 98. 99. 100. 101. 102. 103. 104. 105. 106. 107. 108. 109. 110. 111. 112. 113. 114. 115. 116. 117. 118. 119. 120. 121. 122. 123. 124. 125. 126. 127. 128. 129. 130. 131. 132. 133. PVC market in Czech Republic, MT PVC consumption in Czech Republic, MT PVC finished articles export/import in Czech Republic, MT PVC-S deliveries in Czech Republic, MT PVC compounds deliveries in Czech Republic, MT PVC compounds import-export to Czech Republic, MT Chlorine market а in Czech Republic, MT Chlorine consumption in Czech Republic by branches, КТ Chlorine/Caustic capacities in Czech Republic, КТ Caustic market in Czech Republic, MT Caustic consumption in Czech Republic by branches, КТ Macroeconomic indexes of Slovakia PVC market in Slovakia, MT Chlorine market in Slovakia, MT Chlorine consumption in Slovakia by branches, КТ Chlorine/Caustic capacities in Slovakia, КТ Caustic market in Slovakia, MT Caustic consumption in Slovakia by branches, КТ Macroeconomic indexes of ex-Yugoslavia GDP in countries of ex-Yugoslavia, 2004, % GDP in countries of ex-Yugoslavia, mln. USD GDP per capita in countries of ex-Yugoslavia, USD Population in countries of ex-Yugoslavia, thous. people. Dioki capacities, КTа Dioki production, КТ Chlorine market in ex-Yugoslavia, MT Chlorine consumption in ex-Yugoslavia, MT Chlorine production capacities in ex-Yugoslavia, MT Chlorine production in ex-Yugoslavia, MT Caustic market in ex-Yugoslavia, MT Caustic consumption in ex-Yugoslavia, MT Caustic production in ex-Yugoslavia, MT Caustic import into ex-Yugoslavia, MT Macroeconomic indexes of Bulgaria PVC market in Bulgaria, MT Petrochemical production deliveries from Burgas, MT Chlorine market in Bulgaria, MT Chlorine consumption in Bulgaria by branches, КТ Chlorine/Caustic capacities in Bulgaria, КТа Caustic market in Bulgaria, MT Caustic consumption in Bulgaria by branches, КТ Macroeconomic indexes of Baltic countries Macroeconomic indexes of Latvia Macroeconomic indexes of Lithuania Macroeconomic indexes of Estonia PVC market in Baltic countries, MT Chlorine market in Baltic countries, MT Chlorine consumption in Baltic countries, MT Caustic market in Baltic countries, MT Caustic consumption in Baltic countries, MT Macroeconomic indexes of Belarus’ PVC market in Belarus’, MT Chlorine market in Belarus’, MT Caustic market in Belarus’, MT Macroeconomic indexes of Turkey PVC market in Turkey, MT Production capacities of Petkim, 2005 Basic polymers production in Turkey, MT Chlorine market in Turkey, MT Caustic market in Turkey, MT PVC market in Iran, КТ PVC production capacities in Iran, 2004-2010, КТа PVC market in Iran, 2004-2010, КТ Macroeconomic indexes of South Korea Petrochemical production in South Korea, KТ Petrochemical production in Japan, KT © www.mrcchemical.com 5 PVC in Eastern Europe – 2006 List of diagrams and pictures 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50. 51. 52. 53. 54. 55. 56. 57. 58. 59. 60. 61. 62. 63. 64. 65. 66. 67. 68. 69. 70. 71. 72. 73. 74. 75. GDP increase in the world, % Industrial production increase in the world, % GDP increase in countries of EE, % GDP in current prices in EE, bln. USD GDP distribution in EE, 2004, % GDP increase in some countries of EE, % Population in EE, mln. people. GDP per capita in EE, USD GDP in countries of EE, 2004, bln. USD GDP in countries of EE, 2010, bln. USD GDP in countries of EE (РРР), 2004, bln. USD GDP distribution in EE, 2010, % Construction per capita in EE , sq. m Construction volumes in EE, 2004, % Construction in EE, 2004, mln. sq. m Total construction volumes growth 2005-2008, % to 2004 Basic polymers consumption in the world, 2004, % PVC world balance, 1995-2004 PVC world production, mln. MT PVC world capacities distribution , 2005-2010 New PVC capacities, 2005-2010, % PVC world capacities, 2004, % PVC world capacities, 2010, % PVC world prices, USD / MT PVC-Е world consumption structure, 2004, % PVC-Е consumption in the world, 2004, % PVC-Е consumption structure in Western Europe, 2004, % PVC-Е consumption structure in Western Europe by countries, 2004, % PVC deliveries balance in some countries of Asia, KT PVC prices, FOB / NWE, USD /MT PVC producers in Western Europe, 2004 PVC production integration in Western Europe PVC production in Western Europe, 2004, % Average PVC production capacities, 2005, KТа PVC consumption in Western Europe, 2004, % PVC consumption in Western Europe by countries, % PVC consumption in the world, mln. MT PVC consumption in the world, kg/person PVC region markets, 2004, kg PVC region markets, 2010, kg PVC consumption in EE, 2004 Pipe PVC consumption in EE, 2004 Soft compounds consumption in EE, 2004 Rigid compounds consumption in EE, 2004 Chlorine-vynil branch situation in world regions, 2004 PVC consumption in EE, 2004, КТ PVC consumption in EE by countries, 2004, % PVC consumption in EE, 2004, КТ PVC consumption in EE by countries, 2010, КТ PVC consumption in EE, КТ PVC consumption per capita in EE, kg PVC market components in EE, КТ PVC-E consumption increase, 2005-2010, % PVC –E consumption in CEE, 2004 PVC price, 2000-2006, USD /MT Profile productionin Europe, 2003 Profile consumption in Europe, 2003 PVC profile consumption per 1000 homes, MT PVC pipe consumption in CEE, 2004 Evolution of pipe market Pipe consumption increase, 2000-2005, Western Europe, % European pipes market, КТ Pipes consumption, France, 2004 Pipes consumption, Switzerland, 2004 Pipes consumption, Germany, 2004 Pipes consumption, Poland, 2004 PVC production by EE countries, КТ PVC production/capacities in EE, КТ PVC capacities in EE, 2004, % PVC capacities loading in EE, % PVC export by EE countries, КТ PVC import into Turkey, КТ PVC import by EE countries, КТ PVC / VCM Capacities in EE, 2004, КТ PVC/ VCM production in EE, КТ 76. 77. 78. 79. 80. 81. 82. 83. 84. 85. 86. 87. 88. 89. 90. 91. 92. 93. 94. 95. 96. 97. 98. 99. 100. 101. 102. 103. 104. 105. 106. 107. 108. 109. 110. 111. 112. 113. 114. 115. 116. 117. 118. 119. 120. 121. 122. 123. 124. 125. 126. 127. 128. 129. 130. 131. 132. 133. 134. 135. 136. 137. 138. 139. 140. 141. 142. 143. 144. 145. 146. 147. 148. 149. 150. VCM capacities loading in EE, % VCM Capacities by EE countries, 2004, % PVC/VCM production without Kalush, КТ VCM capacities by EE countries, 2010, % VCM deliveries from Kalush, 2004, % VCM deliveries from Kalush, 2005, % PVC / VCM capacities in EE, КТ Chlorine consumption in EE, КТ Chlorine consumption in EE, 2004, % Chlorine market in EE, КТ Chlorine production in EE, КТ Chlorine production in EE, 2004, % Chlorine production capacities in EE, 2004 Chlorine capacities loading in EE, % Chlorine import into EE, 2004, % Chlorine export from EЕ, 2004, % Caustic consumption in EE, КТ Caustic consumption in EE, 2004, % Caustic market in EE, КТ Caustic production in EE, КТ Caustic production in EE, 2004, % Caustic capacities in EE, 2004, % Caustic capacities loading in EE, % Caustic import into EE, 2004, % Caustic export from EE, 2004, % GDP in Poland, bln. Zlt. Chemical market in Poland, bln. EUR Polymers consumption in Poland, 2004, % PVC consumption in Poland, КТ PVC consumption per capita, Poland, kg PVC market components in Poland, КТ PVC import into Poland, 2005, % PVC prices in Poland, 2000-2006, USD / MT Poland. PVC consumption by markets, КТ PVC –S consumption in Poland, 2004, % Windows sale structure in Poland, % PVC soft compound consumption in Poland, 2004, % PVC rigid compounds consumption in Poland, 2004, % PVC compounds processing in Poland, КТ Goods production of PVC chain in Poland, 2004, КТ GDP in Hungary, bln. EUR Hungary. Construction volumes per capita, sq. m PVC end consumption in Hungary, КТ PVC –S consumption in Hungary, КТ Hungary. PVC consumption per capita, kg Hungary. PVC market components, КТ BorsodChem PVC-S deliveries, КТ PVC price, 2000-2006, USD /MT PVC-S consumption by markets, Hungary, КТ PVC production профиля in Hungary, КТ Production of polymeric pipes in Hungary, КТ VCM capacities,BorsodChem, KTa PVC production chain, BorsodChem Soft compounds production in Hungary, 2004, % Rigid compounds production in Hungary, 2004, % PVC compounds consumption in Hungary, КТ PVC compounds production in Hungary, КТ Goods production of PVC chain в BorsodChem, 2005 Goods production of PVC chain capacities in BorsodChem, 2010 Ethylene deliveries capacities in BorsodChem Ethylene balance in TVK, 2005 GDP in Romania, bln. USD Romania. Construction volumes per capita, sq. m PVC end consumption in Romania, КТ Romania. PVC consumption per capita, kg PVC market components in Romania, КТ Romania. PVC profile consumption, КТ PVC profile import into Romania, 2003, % PVC production in Romania, КТ Oltchim PVC capacities, КТа Oltchim location PVC production chain, Oltchim PVC production goods balance, Oltchim, 2004 Petrom production, КТ GDP in Czech Republic, bln. EUR © www.mrcchemical.com 6 PVC in Eastern Europe - 2006 List of diagrams and pictures (continuation) 151. 152. 153. 154. 155. 156. 157. 158. 159. 160. 161. 162. 163. 164. 165. 166. 167. 168. 169. 170. 171. 172. 173. 174. 175. 176. 177. 178. 179. 180. 181. 182. 183. Czech Republic. Construction volumes per capita, sq. m PVC consumption in Czech Republic, КТ Czech Republic. PVC consumption per capita, kg Czech Republic. PVC market components, КТ Spolana. Before and after flood, 2002 GDP of Slovakia, bln. EUR PVC consumption in Slovakia, КТ Slovakia. PVC consumption per capita, kg Slovakia. PVC market components, КТ GDP of ex-Yugoslavia, bln. USD GDP per capita in ex-Yugoslavia, 2004, bln. USD PVC consumption in ex-Yugoslavia, КТ PVC consumption in ex-Yugoslavia, 2004, % Ex-Yugoslavia. PVC consumption per capita, kg PVC consumption per capita, 2004, kg Dioki capacities, КТ Dioki production, КТ Dioki production chain, КТ GDP in Bulgaria, bln. USD PVC consumption in Bulgaria, КТ Bulgaria. PVC consumption per capita, kg PVC import into Bulgaria, 2005, % PVC production forecast in Bulgaria, 2007, % GDP in Baltic countries, bln. EUR GDP in Baltic countries, 2005, % GDP per capita in Baltic countries, thous. USD PVC consumption in Baltic countries, КТ PVC consumption in Baltic countries, 2005, % Baltic countries. PVC consumption per capita, kg Baltic countries. PVC consumption per capita, 2004, kg GDP in Belarus’, bln. USD PVC consumption in Belarus’, КТ Belarus’. PVC consumption per capita, kg 184. 185. 186. 187. 188. 189. 190. 191. 192. 193. 194. 195. 196. 197. 198. 199. 200. 201. 202. 203. 204. 205. 206. 207. 208. 209. 210. 211. 212. 213. 214. 215. GDP in Turkey, bln. USD Polymers consumption and GMP increase in Turkey, % Petrochemical productions in Turkey PVC consumption in Turkey, КТ Turkey. PVC consumption per capita, kg Turkey. PVC market components, КТ PVC import into Turkey, КТ First five PVC importers to Turkey, КТ PVC importers, duty free, КТ PVC-S producers shares in Turkey, 2004, % PVC-S consumption structure in Turkey, 2005, % Geography of PVC processors in Turkey PVC articles export form Turkey, 2004, % Petkim PVC production area Petrochemical goods production, Petkim Caustic import into Turkey, 2005, % PVC consumption per capita in Iran, кг PVC-S consumption in Iran, 2004, % PVC producers shares in Iran, 2004, % Main PVC importers to Iran, 2004, % GDP in China, bln. USD PVC consumption in China, mln. MT China. PVC consumption per capita, kg China. PVC market balance, mln. MT Planed new PVC capacities in China Average PVC production capacity in Asia, КТа PVC capacities distribution in China PVC market balance in China, 2004, % PVC consumption in China, 2005, % PVC deliveries to China, 2003, % PVC export dependence from China deliveries GDP in South Korea, bln . USD 7 © www.mrcchemical.com © PVC in Eastern Europe - 2006 List of companies mentioned 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50. 51. 52. 53. 54. 55. 56. 57. 58. 59. 60. 61. 62. 63. 64. 65. 66. 67. 68. 69. Abadan Petrochemical Plant Ajka Alfa PVC Alpro Aluminipari Aluplast Aluplast Romania Anwil Arkema Arvand Atofina Autobar Packaging Balkan Basell Orlen Polyolefins BBG Alum BC-Ablakprofil BC-Ongropack Blick BorsodChem Budapesti Vegyim Budimex SA Budimex Unibud Bulplast Cangzhou Catalytic Int CEC CEFIC Central Statistical Bureau of Latvia Central Statistical Bureau of Lithuania Chematex Chemopetrol ChemOrbis ChimComplex CMAI Cooling towers Corina Gealan CTIP Czech Statistical Office De Nora De Nora De Nora Permelec Deceuninck Decora Devnya Dioki Dow DSM Dwory Echo Investment Elcabel Elektrobosna E I ERG Bierun Ergis Erpen Escape EVC Exbud Skanska Filpen Firatpen Formosa Fulcrum Global Partners Gamaplast Gealan Gealan Polska Ghadir Gotmar Granpol Hansaplast Harriman Chemsult. Heghmatane 70. 71. 72. 73. 74. 75. 76. 77. 78. 79. 80. 81. 82. 83. 84. 85. 86. 87. 88. 89. 90. 91. 92. 93. 94. 95. 96. 97. 98. 99. 100. 101. 102. 103. 104. 105. 106. 107. 108. 109. 110. 111. 112. 113. 114. 115. 116. 117. 118. 119. 120. 121. 122. 123. 124. 125. 126. 127. 128. 129. 130. 131. 132. 133. 134. 135. 136. 137. Heimatieh HIP Hochtief Polska Hungarian Central Statistical Office Huyndai Hydro ICIS-LOR Imam Khomeini INCEL Ineos Instalplast-Lask Iran Petrochemical Commerce Company ITD Kabro Kaczmarek-2 Kapitan Diado Nikola Kommerling Kompen Krupp Uhde KWH Pipe Lentex LG Chem Lipoplast Timisora LVM Matroz Metalplast – Oboroniki Michael Rigby Associates Mitex SA Mitsui Chem Mitsui Eng MOL Mominakrepost Mondo Style Timisoara Mostostal Warszawa Mostostal Zabrze Holding Nafta Polska S.A. National Bureau of Statistics of China National statistic office of Republic of Korea National statistical institute of Bulgaria Nexant Ningxia West Nitrokémia 2000 NCHZ Ohis-Komerc Oknoplast Oltchim S.A. OMV Orianea Pagev Pakpen Panorama Ablakgyarto Penta-Group Pestan Petar Karaminchev Petco Petkim Petkim Petrokimya Holding Pimas PipeLife PKN Orlen Plastchim Plastcommerce Plastform Plastics Review Plastsistem Polimeri Polinex Polish Chamber of Chemical Industry 138. 139. 140. 141. 142. 143. 144. 145. 146. 147. 148. 149. 150. 151. 152. 153. 154. 155. 156. 157. 158. 159. 160. 161. 162. 163. 164. 165. 166. 167. 168. 169. 170. 171. 172. 173. 174. 175. 176. 177. 178. 179. 180. 181. 182. 183. 184. 185. 186. 187. 188. 189. 190. 191. 192. 193. 194. 195. 196. 197. 198. 199. 200. 201. 202. 203. Profil PVC Profilink Profine Profine Romania Pukad PV Plastik Qilu Rehau Romaplast Samsung Saponia Seltra Shell Chemicals Shenyang Shin Etsu Sinochem Slovnaft Sodaso Solvay Kemia Solvin Spolana Spolek Statistical Office of Estonia Stigma Stone & Webster Eng Storgozia Strabag Suki Group Tainyuan TCT Technip Teolinoplast Terraplast ThyssenKrupp Tianyuan Shanghai Tovama Tovarna KIH Trocal Turkish statistical institution TVK UCT Unipetrol Uponor Uponor Polska Valplast Veka Vestolit Vias Vinnolit Warbud SA Wavin Wavin Metalplast Weiss-Profil World Bank Xinjiang Tianye Zachem ZAW Tarnowie ZC Oswiecim ZC Rokita ZC Zachem Zelin Zupa KAR Karpatneftechem Lukoil-neftechem Ministry of statistics and analysis of Belarus’ Republic 204. Finance Ministry of Slovak 8 © www.mrcchemical.com © PVC in Eastern Europe – 2006 Resume We would like to present our new report that has been worked out jointly by two companies: Market Report Company (MRC) and Harriman Chemsult. Collecting information for this report we found out that there were practically no aggregated data on the PVC market for the countries of Eastern Europe (EE). As a rule, reports pertain either to some certain countries or to a group of countries of this region. We tried to fill this gap and compiled a general report that embraces all countries of Eastern Europe. Now, our comprehensive analysis includes materials on 16 countries with the total population of 178 million. Furthermore, we paid special attention to the influence exerted by neighboring countries, mainly by Turkey and Russia. Macroeconomic figures of Eastern European countries are quite positive today. Within the recent six years the general GDP rate has been growing by 4-5% annually. The volume of GDP, evaluated at the purchasing power parity rate, constituted USD 1 825 billion in 2005, which corresponds to the current GDP rate of Great Britain or France, for instance. By the year 2010, the GDP index per capita (in current prices) would have exceeded the level of USD 7.6 thous. Moreover, in the For the first time we tried to embrace the PVC market of all Eastern European countries Czech Republic and in Hungary, this figure already now makes up USD 10 thous., and in Slovenia the GDP per capita will correspond to the current level of Spain and Greece by 2010 (see Section 1). The construction market in EE countries demonstrates positive dynamics as well. We would like to draw your attention to the Polish construction market, which holds about 44% of all construction volumes in the region. Since the EU is going to grant about EUR 48 billion for the development of the Polish infrastructure by the year 2012, we are looking forward to continuing growth of construction in Poland. The PVC market in Eastern Europe is one of the fastest growing markets in the world (see Section 2). Within the nearest five years the overall PVC consumption will be increasing by 7-8% annually. The highest growth rates will be observed in Romania, Ukraine, Belarus and Lithuania. In 2010, the overall PVC consumption in the region will exceed the level of 1.1 mln. MT, and the PVC consumption per capita will approach to the world average level of 6.5 kg per person. Today, the Eastern European region is the net exporter of PVC. In 2004, the export constituted 75% of the total output of PVC manufactured there. The biggest exporters of PVC are Hungary, Romania and Poland. Despite of the dominating domestic PVC manufacture, import of PVC to Eastern Europe increases in average by 12% per year. The highest import figures are recorded in Poland (240 КТ), Ukraine (80 КТ) and Hungary (31 КТ) – see Section 3. Turkey is the main importer of PVC from Eastern Europe now. The market of PVC in this country will be increasing by 8% annually, furthermore, the growth of consumption right up to the year 2010 will be provided exclusively by the growth of import supplies of PVC. Forecasting development of the EE market till the year 2010, we took into account possible increasing export opportunities of Iran (Section © www.mrcchemical.com 9 PVC in Eastern Europe – 2006 4.1), which, in the future, may affect export supplies to Turkey of the biggest Eastern European manufacturers such as Oltchim, BorsodChem and Anwil. Since the PVC production is inseparably linked with the production of Chlor Alkali products, VCM, EDC and ethylene, we made up balances of all these products by each country of Eastern Europe, where PVC production facilities are located. At present, the overall PVC production capacity is in general coordinated with that of VCM. However, the utilization of the latter, not taking into account, the VCM plant in Kalush, constitutes 96-98% today. Shall the PVC-S project in Kalush be realized (the planned capacity is 300 KTa), by the year 2010, there may arise shortage of VCM at the level of 120-150 KT in the market of Eastern Europe (see Section 3.6) Reasoning from the existing and forecast balance of production capacities of PVC, VCM, EDC, chlorine, caustic and ethylene, we analysed possibilities to increase such capacities by each EE PVC manufacturer. We drew up balances for the entire chain of products used in PVC production for Anwil, BorsodChem, Oltchim, Spolana, NCHZ and Petkim. We analysed opportunities of Lukoil-Neftechem in view of PVC The report places emphasis on important issues of the industry: development of PVC processing, VCM market balance, influence of Turkey, Iran and China production in Kalush, as well as that of Dioki on restoration of VCM and PVC production. The fourth Section of the Report (4.1 – 4.10) is entirely dedicated to the detailed description of trends in consumption, production and foreign trade of PVC, VCM and chlorine-caustic separately in each country of Eastern Europe. Studying markets of Poland, Hungary, the Czech Republic, Romania and Turkey, we separately analysed PVC consumption structure by processing sectors. Having studied these data you may find out, for instance, that in terms of PVC profile production per one thousand dwellings, EE countries are outstripping now many states in Western Europe, and Poland in terms of this index is basically the AllEuropean leader. We analysed prospects of PVC processing in profile, pipe, cable and flooring sectors separately by each Eastern European country. Many experts forecast coming of Chinese PVC to the market of Eastern Europe within the nearest three-four years, referring to supplies from China to Turkey and Russia which already took place in 2005. We also analysed key trends in the Chinese market (Section 5.2) and determined prospects of PVC export from this country. Taking into account the inseparable link of the Chinese market with the PVC export from Taiwan, South Korea and Japan, we tried to analyse the potential of these countries in their search for new export opportunities in new regions, including markets of Eastern European countries (Section 5.3). All detailed data (GDP, demographics, construction volumes, consumption, output, export and import of PVC, VCM, chlorine, caustic, etc.) by each Eastern European country, including Turkey and Russia, over the period 2000 – 2010 are presented in respective tables in Appendix to this report. © www.mrcchemical.com © 10 PVC in Eastern Europe – 2006 ...extract from report… 1. Macroeconomic Indexes of East European Countries The economy of countries of the Eastern European region (hereinafter referred to as EE) is one of the fastest developing economies in the world. The growth of the GDP over the period 2005-2007 will make up a bit more than 5%, which is by 1.5 times more than average in the world, and by almost two times more than in the countries of Western Europe (see D.1.1). D.1.1. Growth of GDP in the world, % Central&Eastern Europe 8 Europe 25 Southeast Asia South America World USA 7,1 6,9 6,3 6,2 6 5,3 6,2 4,1 4,3 4 3,1 2,3 4,4 4 3,5 3,8 3,1 3 3,2 3,5 2,2 2,1 1,8 2 6 5 4,8 0 2004 The growth of the EE economy will have constituted 4% by 2010 2005 2006 2007 Source: CEFIC According to the forecast of the World Bank, the growth of the GDP in 15 countries of Eastern Europe will be remaining at the level of 4% right up to the year 2010. The GDP per capita in the countries of Eastern Europe is not homogeneous either. The highest level was recorded in Slovenia, the Czech Republic and Hungary in 2004 (D. 1.9). GDP per capita, 000 USD D.1.9. GDP* in EE countries, 2004, USD bln. 20 Slovenia 32 15 Czech Rep 107 Hungary 100 10 Slovakia 41 Poland 242 Turkey 302 Lithuania 22 5 Russia 582 Eastern Europe 825 Ex-Yugoslavia 104 Bulgaria 24 Romania 73 Ukraine 65 0 0 30 60 90 120 150 180 Population, mln. people * in current prices Source: WorldBank … It is of no less importance to consider distribution of GDP, calculated by PPP (purchasing power parity). This index demonstrates the potential of underestimated economies of Eastern Europe, which still undergo structural changes. ... Among other markets we should single out the Hungarian market, which is the leader in Eastern Europe in terms of construction per capita, and the market © www.mrcchemical.com 11 PVC in Eastern Europe – 2006 of Lithuania, where the level of the specific construction is higher than in Russia, Belarus and Ukraine taken together. The volumes of the construction market in Turkey are by more than two times higher than the similar figures in Russia (D. 1.15). Construction per capita, sq.m. D.1.15. Construction in EE, 2004, mln. sq.m. 5 Hungary 46 4 Poland 142 Czechia 30 3 EE 265 2 Litva 5 Romania Turkey 30 94 Russia 1 Belarus 44 Ukraine 4 8 0 0 30 60 90 120 150 180 Population, mln. In Poland and in Hungary the construction markets will be developing faster than in any other European countries Source: MRC The construction market of Poland exceeds the Russian market in terms of absolute indexes by more than 3.5 times. Besides, the volumes of Polish construction are significant even comparing with progressive countries of the world. Most probably, the construction market of Poland will continue to develop very quickly in future, taking into consideration subsidies assigned by the EU in the amount of EUR 48 billion for the period 2006-2012 meant for the development of the general economic infrastructure. Extremely high dynamics of the construction market is observed in the Turkish market (only in 2004, the construction volume increased by 1.5 times compared to 2003). We should admit that the growth of the construction volumes in Russia, Ukraine and Belarus are high as well. The construction market of Romania demonstrates low growth rates. The Baltic States undergo rapid development of the construction market. There has been some recession in the growth of the construction volumes in Czech Republic within the recent years, however, by the year 2008, will have been growing much faster than the same market in the countries of Western Europe. The two countries of Eastern Europe – Poland and Hungary – will remain the leaders in terms of construction growth rates. © www.mrcchemical.com © 12 PVC in Eastern Europe – 2006 ...extract from report… 3. PVC Market in Eastern Europe 3.2. Consumption of PVC in East-European Countries Inside of Eastern Europe, the PVC markets develop in accordance with different scenarios (see D. 3.2.1). We can mark out markets with relatively low level of PVC consumption per capita but with high growth rates: Russia, Lithuania, Ukraine, Belarus, Romania. And vice versa, there are markets with the high level of the specific consumption but with the stable dynamics such as Hungary and Poland. There are countries with balanced consumption and dynamics such Turkey and Slovakia. As well as there countries with relatively low specific consumption and low growth rates such as Bulgaria, Serbia and Montenegro. D. 3.2.1. Consumption of PVC in EE, 2004, KT PVC per capita, kg Hungary 12 110 Sample page Please see full data in our Report Poland 10 376 Turkey 8 588 Czechia EE 55 6 803 Slovakia 26 Bulgaria Lithuania Russia 4 16 Estonia 71 Romania 2 15 448 Ех-Yugoslavia 3 45 Belarus Ukraine 23 61 0 0% 5% 10% 15% 20% 25% 30% 35% 40% Market growth, 99-04,% PVC markets in different EE countries develop with different dynamics Source: MRC / Harriman Chemsult It is noteworthy that almost half of PVC consumed in Eastern Europe belongs to the Polish market (D. 3.2.2). It is followed by the markets of Hungary and Ukraine. In terms of their volumes the markets of Turkey and Russia together surpass the market of Eastern Europe. In 2004 PVC consumption in Turkey conforms to 75% of market in Eastern Europe, in Russia – to 60%. D. 3.2.2. Consumption of PVC in EE, 2004 Slovenia 3% Croatia 1% Baltic States 2% Czechia 7% Belarus 3% Macedonia 1% Bulgaria 2% Serbia and Montenegro 4% Hungary 13% Ukraine 8% Slovakia 3% Romania 6% Poland 46% Source: MRC / Harriman Chemsult © www.mrcchemical.com 13 15 PVC in Eastern Europe – 2006 Differences in the consumption of PVC by the countries of Eastern Europe will become more leveled (D. 3.2.3). The majority of markets are stabilized at the level of 5%, and the annual growth at the level of … kg of PVC per capita. The markets of Russia and Turkey will be separately corresponding already to 80% of the EE market. The growth in Turkey will be stabilized at the level of 7-8%, whereas in Russia the market will be demonstrating the annual growth at the level of 11-12%. D. 3.2.3. Consumption of PVC in EE, 2010, KT PVC per capita, kg Poland 15 472 Hungary Sample page Please see full data in our Report 109 12 Turkey 894 44 Slovakia 9 Ех-Yugoslavia Czechia Lithuania 95 26 60 6 EE Belarus Russia 38 839 1 124 Bulgaria 3 31 Romania Estonia Ukraine 5 154 89 0 0% 5% 10% 15% 20% Market growth, 05-10,% Source: MRC / Harriman Chemsult The Polish PVC market is the most capacious in Eastern Europe In terms of PVC consumption Poland will remain an undisputable leader. The Ukrainian market will be able to outstrip the Hungarian market in PVC consumption volumes by 2010, and it will become the second regional market in Eastern Europe (D. 3.2.4). The markets of Lithuania and Romania will be demonstrating quite high growth rates. D. 3.2.4. Consumption of PVC in EE, 2010 Belarus 2% Sample page Bulgaria 2% Please see full data in our Report Baltic States 2% Czechia 6% Ex- Yugoslavia Ukraine 11% 14% Hungary 11% Slovakia 4% Romania 6% Source: MRC / Harriman Chemsult Poland 42% The distinctive feature of some EE countries with the developed PVC production (Hungary, Romania, Slovakia and the Czech Republic) is that the classical formula for the definition of the actual PVC consumption “Consumption = Production + Import - Export” is not quite correct for them. This is explained by the fact that the domestic remainders of PVC of PVC producers in these countries calculated as “Production minus Export” do not always correspond to the consumption inside of the country… © www.mrcchemical.com 15 14 PVC in Eastern Europe – 2006 … extract from report… А) Profile Market The present volume of profile production in Europe exceeds the level of … mln. MT. During 2000-2004, this sector increased by 30%. The markets of two countries – Germany and Great Britain – provide more than two thirds of the European PVC profile consumption (D. 3.2.9) D. 3.2.9. Production of profile in Europe, 2003 Poland West-European profile manufacturers actively develop the market of Eastern Europe 7% Russia Other 3% 12% Turkey 11% Great Britain 20% France 8% Hungary 1% Germany 38% Source: MRC There are more than 70 manufacturers in the industry, moreover, we can single out top five companies (four companies are from Germany), which hold more than a half of the total production volume: ¾ Profine: Germany, France, Italy, Spain, Russia ¾ Veka: Germany, Great Britain, Poland, France, Spain, Russia ¾ Rehau: Germany, Great Britain, Poland, France, Russia ¾ Aluplast: Germany, Great Britain, Poland, Austria, Russia ¾ Deceuninck: Germany, Great Britain, Poland, Belgium, France, Spain, Turkey … Already now, the markets of Poland and Turkey surpass in terms of their absolute indexes the market of France. And in terms of PVC profile consumption per 1000 homes the East-European countries by far ahead of the markets of Western Europe (D. 3.2.11). Poland is the European leader in terms of PVC consumption per 1000 homes D. 3.2.11. Consumption of PVC profile per 1000 homes, MT Sample page Please see full data in our Report 16 12 8 4 0 France Germany Hungary Slovakia Austria Estonia Latvia Slovenia Belgium Turkey Ireland Lithuania UK Czechia Poland Source: MRC © www.mrcchemical.com 15 PVC in Eastern Europe – 2006 … extract from report… 3.6 The Balance of the VCM Market in Eastern Europe Since 2002, the volume of VCM production has always been surpassing the level of the PVC production. Today, the existing VCM production capacities are concentrated in six countries of Eastern Europe as well (Table 3.6.1). Table 3.6.1. VCM production capacities in the EE countries, MT Country 2000 2001 Croatia 2002 2003 2004 2005 Sample page Please see full data in our Report Hungary Poland Russia Romania Slovakia Turkey Ukraine Czech Rep Total EE Source: MRC / Harriman Chemsult The workload of the VCM production capacities is by 10% higher than that for PVC Today, the share of the leaders in the production of VCM (Ukraine, Poland and Hungary) makes up 70% of the total volume of the VCM production capacities in Eastern Europe … The shortage of the VCM production capacities at BorsodChem, Anwil and Oltchim is compensated by its surplus at Karpatneftechem in Kalush (LukoilNeftechem Group) … … In case Kalush launches own PVC-S production in 2009 with the capacity 300 Kta, the balance of the PVC/VCM in Eastern Europe can be broken. The shortage of the VCM production capacities may make up about … KTa by 2010 (D. 3.6.9). D. 3.6.9. PVC/VCM production capacities in EE, KT PVC VCM Sample page Please see full data in our Report 2000 1437 1500 1008 1437 1026 1397 1092 1237 1125 1252 2003 2004 1105 1342 1158 1442 1290 1442 1290 1602 1440 1725 1602 1725 1602 1000 500 0 2000 2001 2002 2005 2006 2007 2008 2009 2010 Source: MRC © www.mrcchemical.com 16 PVC in Eastern Europe – 2006 … extract from report… 4. PVC Market by Countries of Eastern Europe 4.1 Poland The Polish PVC market has been growing with the average annual speed 6.5% within the recent six years. The overall PVC consumption will make up … KT by 2010. In terms of this index, the Polish market is the leader in Eastern Europe (D. 4.1.2.1). D. 4.1.2.1. Consumption of PVC in Poland, KT 500 400 291 300 268 305 437 450 461 472 2007 2008 2009 2010 418 page Please see full data in our Report 328 399 376 Sample 200 100 0 2000 Poland is the biggest East European PVC net importer as well 2001 2002 2003 2004 2005 2006 Source: MRC / Harriman Chemsult … Supplies of imported PVC constitute 64% of its consumption; the export makes up almost half of the manufactured PVC (Table 4.1.2.1). Table 4.1.2.1. PVC market in Poland, MT Index 2000 2001 2002 2003 2004 2005* Capacities Sample page Please see full data in our Report Production Import Export Consumption Import into consumption Export to consumption * assessment Source: MRC / Harriman Chemsult … According to our estimations, the Polish PVC-S market, during 20062010, will be developing mainly due to the growth of processing in the profile manufacturing sector. The markets of pipes and cable will preserve their existing volumes (D. 4.1.2.6). D. 4.1.2.6. Poland. Consumpt ion of PVC-S by market s, KT pipes films / sheets cable profile Sample page Please see full data in our Report 500 400 300 200 100 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Source: BorsodChem/ MRC © www.mrcchemical.com 17 PVC in Eastern Europe – 2006 а) Profile Market At present, PVC windows are the leaders in the Polish window market (D. 4.1.2.8). D.4.1.2.8. Structure of window sales in Poland, % Other 15% Sample page Please see full data in our Report PVC 40% Aluminum 15% Wooden 30% Source: MRC The biggest European players are leading in Polish profile market In 2004, the overall production of doors and windows in money terms made up almost USD 2 billion. The export of doors and windows constituted EUR 280 mln. in 2004, 70% of them were windows and doors made of wood. Today, there are about 90 enterprises in this sector with the overall number of employees more than 120 thousand persons. There are such biggest European manufacturers of PVC profile as Rehau, Aluplast, Gealan, ThyssenKrupp. There are also large Polish companies: Roplasto, Metalplast, Oknoplast, Profil PVC. (Table 4.1.2.4). Table 4.1.2.4. Manufacturers of window profile in Poland, 2004, USD, mln. Company Rehau Sp. z. o.o. Proceeds Profit Sample page Please see full data in our Report Margin Aluplast Sp. z. o.o. Oknoplast Sp. z. o.o. Profil PVC Sp. z. o.o. ThyssenKrupp Alpex Plastics Sp. z. o.o. Gealan Polska Sp. z. o.o. Source: Plastics Review © www.mrcchemical.com 18 PVC in Eastern Europe – 2006 …extract from report… 4.2 Hungary … Hungary is the biggest net exporter of PVC in Eastern Europe. The ratio of export to the overall production volume constitutes 80%; and in absolute terms the level of export exceeds the level of … KT (D.4.2.2.4). D. 4.2.2.4. Hungary. PVC market components, KT Production Import 272 268 233 219 page Sample Please see full data in our Report 229 212 200 100 Export 275 267 264 300 216 44 49 58 59 63 2000 2001 2002 2003 2004 0 Source: MRC / Harriman Chemsult Despite of the high level of the domestic PVC production, the Hungarian market is supplied with more than … KT of imported PVC. Today, the share of Hungary is the biggest exporter of PVC in Eastern Europe import in the total consumption exceeds the level of …% (Table 4.2.2.1). Table 4.2.2.1. PVC market in Hungary, MT Index 2000 2001 Capacities 2002 2003 2004 2005* Sample page Please see full data in our Report Production Import Export Consumption ** Import into consumption Export to production * assessement ** according to formula: production + import and export Source: MRC / Harriman Chemsult … Within the recent five years the Hungarian profile production increased by 2.5 times. It is expected that this sector will be demonstrating positive dynamics further on (D. 4.2.2.8). D. 4.2.2.8. PVC prof ile product ion in Hungary, KT 30 Sample page Please see full data in our Report 20 10 0 1996 1997 1998 1999 2000 2001 2002 2003 2004 Source: BorsodChem BorsodChem subdivision – BC-Ablakprofil – is one of the biggest players in the Hunagarian market of profiles. In 2004, its sales level exceeded …KT; 37% of them are supplied for export. The market share of profiles for the window system Panorama (BC-Ablakprofil brand) constitutes 40-45%. Panorama’s subdivision– Ablakgyarto es Formalgaso – manufactured … thous. m. of PVC windows (consumption of about … MT of profiles). © www.mrcchemical.com 19 PVC in Eastern Europe – 2006 …extract from report… 4.4 The Czech Republic 4.4.4 The Balance of the VCM, Ethylene, Chlorine and Caustic Markets The PVC production in Neratovice is a good example of equilibration of the entire production chain. The overall chlorine production capacities at the enterprise constitute 135 KTa (the plant was built in 1975 in compliance with the technology of De Nora). The PVC production capacity is 132 KTa (Huels). EDC (capacity - 200 KTa) / VCM (capacity - 135 KTa) plant was built according to the technology of Stauffer. The product mix of the enterprise includes both suspension PVC and its compounds (the volume of compound production constituted about 5 KT in 2004). Apart from Spolana, chlorine production capacities are also located at Spolek. Their overall load made up 62% in 2004 (Table 4.4.4.1). Table 4.4.4.1. Chlorine market in Czech Republic, MT Index 2000 Capacities 2001 2002 2003 2004 2005* Sample page Please see full data in our Report Production Import Export Consumption Source: Harriman Chemsult * assessment PVC production in Czech Republic is well balanced PVC production is the main consumer of chlorine (Table 4.4.4.2). Table 4.4.4.2. Consumption of chlorine in Czech Republic by industries, KT Product 2001 2002 2003 2004 2005* 2007* Vinyls Sample page Please see full data in our Report C2 Chloroethanes Other organics Non-organics Other Total Source: Harriman Chemsult * assessment Consumption of caustic in Czech Republic constitutes … KT; import (mainly, from Hungary) does not exceed … KT; and export in the amount of … KT mainly belongs to Germany and Austria (Table 4.4.4.4). Table 4.4.4.4. Caustic market in Czech Republic, MT Index 2000 2001 2002 2003 2004 2005* Capacities Production Sample page Please see full data in our Report Import Export Consumption * assessment Source: Harriman Chemsult In caustic supplies Spolana mainly concentrates on export; and Spolek is more oriented towards the work in the domestic market. Production of paper is the main consumer. © www.mrcchemical.com 20 PVC in Eastern Europe – 2006 …extract from report… 4.10 Turkey 4.10.2 PVC Consumption PVC market in Turkey develops very quickly. Within the recent six years it has been growing in average by 14% annually. The overall PVC consumption would run up to the level of … KT by the year 2010 (D. 4.10.2.1). According to the forecast of Petkim, the PVC market in 2010 would constitute … KT. D. 4.10.2.1. PVC consumpt ion in Turkey KT 1000 803 Sample page 753 700our Report Please see full654 data in 800 600 853 894 588 447 400 351 424 480 200 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Source: MRC / Harriman Chemsult There is PVC production capacities shortage in the country. The level of PVC import makes up 75% in total consumption volume. The Turkish market will remain the biggest net importer in the region right up to 2010. By this time, the import of PVC may have constituted … KT. Turkey is the most important market for Romanian Oltchim and Hungarian BorsodChem. Export of Romanian PVC to Turkey made up 95 KT, Hungarian – 26 KT in 2004. (D. 4.10.2.5). D.4.10.2.5. First five PVC importers into Turkey, КТ Turkey will still be the biggest net-importer in the region 100 2002 2003 2004 50 0 Romania Hungary Germany Poland Italy Source: MRC There are sixty profile systems producers and almost five thousand plastic windows producers in Turkey. The biggest profile producers are Pimas, Filpen, Pakpen, Kompen, Erpen, Firatpen. By Pukad estimation, profile production capacities made up … KT and its total production volume - … KT in 2005. At the same time more than … KT of profiles were exported to other countries. Three sectors of PVC processing provided more than … KT of export deliveries in 2004. As well as in other countries of Eastern Europe, PVC consumption growth leader is profile sector. According to market experts, there are no objective reasons for PVC consumption volumes decrease. It is expected the new capacities input. © www.mrcchemical.com 21 PVC in Eastern Europe – 2006 … extract from report … 5. Influence of other regions on PVC market of Eastern Europe 5.1 Iran … Today, the demand of the Iran PVC market meets mainly with domestic production. The share of import in the general consumption structure constituted about 12% in 2004 (Table 5.1.1). Table 5.1.1 PVC market in Iran, КТ Index 2001 Production 2002 2003 2004 Sample page Please see full data in our Report Import Export Consumption The net export of PVC from Iran will make up 370 KT in 2010 Source: MRC The leading PVC suppliers to Iranian market are two local companies: Iran Petrochemical Commerce Company (IPCC) и Abadan Petrochemical Plant (D.5.1.3). D.5.1.3. The share of PVC producers in Iran, 2004, % Sample page Abadan Please see full data in our Report 22% Сауд. Аравия 6% IPCC 68% Western Europe 3% other 1% Source: MRC … In the nearest future, the country plans to put into operation new PVC production capacities at the level of … KTa. The launch of the production Arvand (330 KT) in 2009 will be the biggest project. As well, in 2009, Heghmatane is planning to start production of emulsion PVC with the capacity 40 KTa (Table 5.1.2). The overall PVC production capacities in the country will make up more than … KTa in 2009. At the same time, consumption of PVC will run up to … KT per year in 2010 (Table 5.1.3). Table 5.1.3 PVC market in Iran, 2004-2010, КТ Index 2004 2005* 2006* 2007* 2008* 2009* 2010* Sample page Please see full data in our Report Production Import Export Consumption * forecast Source: MRC According to the estimations of experts, Irani export opportunities will make up about … KT per year already in 2009. One of the crucial issues is how Irani companies are going to distribute their export supplies. © www.mrcchemical.com 22 24 PVC in Eastern Europe – 2006 ….extract from report… 5.2 China … At present, China is the biggest world importer of petrochemical products. In the opinion of Nexant, China manufactures only half of the overall volume of consumed base polymers. About 42% of the total volumes of the world PE export belong to China. The similar situation is with polypropylene, polystyrene and PVC. Overall PVC consumption demonstrates extremely high growth rates. The annual growth within the recent six years constituted about 10-11%. It is expected that within the following decade the overall consumption of PVC would increase by two times. By the year 2010, China will be consuming about …mln. MT of PVC (D. 5.2.2). D. 5.2.2. PVC consumption in China, mln. MT PVC production growth in China will change its deliveries structure in all other region markets 15 Sample page Please see full data in our 9,4 8,9 Report 10 4,8 5,3 5,7 6,3 2000 2001 2002 2003 7,0 7,8 8,3 2005 2006 9,7 10,1 2009 2010 5 0 2004 2007 2008 Source: MRC It is expected great changes in the structure of PVC deliveries to Chinese market. PVC import will decrease more than in five times, at the same time its domestic production volume will increase in 1.9 times up to 2010.It is declared more than thirty projects in PVC, VCM, EDC capacities expansion up to 2006. ...Because of differences in opinions about China between West-European analytics, we decided to use Chinese company marketing information. According to Sinochem today PVC consumption makes up about 24% in profile market and 21% in pipes market. Because of fast growth of domestic PVC production, China may soon become independent player in the world export market. The influence of Chinese exporters during price differences conservation in internal and external markets will be especially great. Chinese PVC today has already appeared in the markets of Turkey and Russia. South Korea, Taiwan and Japan will be the main victims of Chinese PVC Chinese PVC has already appeared in the markets of Turkey and Russia import structure changes. During the biggest PVC import into China, the share of these three countries made up 64% of total import deliveries. PVC export from China made up … KT in 1Q 2006: about ...КТ were delivered to Turkey, ... КТ – to India, ... КТ – to Korea, ... КТ – to Egypt and … KT – to Russia. Analysts of Sinochem expect that Turkey and South America will become the most attractive areas for export of Chinese PVC by the year 2010. With the growth of the Chinese export, we may only await where they are going to direct PVC from Japan, S. Korea and Taiwan. © www.mrcchemical.com 23 24 PVC in Eastern Europe – 2006 Appendix © www.mrcchemical.com 24 PVC in Eastern Europe - 2006 estimation forecast Table A-3. GDP per capita, USD (in current prices) Country 2 000 2 001 2 002 2 003 2 004 2 005 2 006 2 007 2 008 2 009 2 010 Belarus’ Bulgaria Bosnia and Herzegovina Hungary Latvia Sample page Please see full data in our Report Lithuania Macedonia Poland Russia Romania Serbia and Montenegro Slovakia Slovenia Turkey Ukraine Croatia Czech Republic Estonia Total EE* * Here and further not including Russia and Turkey Source: World Bank 25 © www.mrcchemical.com PVC in Eastern Europe - 2006 Table A-5. PVC resin consumption, MT Country 2 000 2 001 2 002 2 003 2 004 2 005 2 006 2 007 2 008 2 009 2 010 Belarus’ Bulgaria Bosnia and Herzegovina Hungary Latvia Lithuania Sample page Please see full data in our Report Macedonia Poland Russia Romania Serbia and Montenegro Slovakia Slovenia Turkey Ukraine Croatia Czech Republic Estonia Total EE Source: MRC/Harriman Chemsult 26 © www.mrcchemical.com PVC in Eastern Europe - 2006 Table A-10. PVC production, MT Country 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Hungary Poland Russia Romania Sample page Please see full data in our Report Slovakia Turkey Ukraine Czech Republic Total EE Source: MRC / Harriman Chemsult Table A-13. VCM capacities, MT Country 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Croatia Hungary Poland Russia Romania Sample page Please see full data in our Report Slovakia Turkey Ukraine Czech Republic Total EE Source: MRC / Harriman Chemsult 27 © www.mrcchemical.com PVC in Eastern Europe - 2006 Table A-14. Chlorine consumption, MT Country 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Belarus’ Bulgaria Serbia and Montenegro Hungary Latvia Lithuania Poland Sample page Please see full data in our Report Romania Slovakia Ukraine Czech Republic Estonia Russia Turkey Total EE Source: MRC / Harriman Chemsult 28 © www.mrcchemical.com PVC in Eastern Europe - 2006 Table A-18. Caustic consumption, MT Country 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Belarus’ Bulgaria Serbia and Montenegro Hungary Latvia Lithuania Poland Sample page Please see full data in our Report Russia Romania Slovakia Turkey Ukraine Czech Republic Estonia Total EE Source: MRC / Harriman Chemsult 29 © www.mrcchemical.com