Global scenario
Historically more
than 75% of the world capacity and consumption has been
concentrated in North America, Western Europe and Japan. In the
last decade significant shift in capacity expansion has been taking
place in favor of Asia Pacific.
Capacities are to be
generally built up near the raw material resources or near the
large consumption markets.With the highest per capita consumption
of petrochemicals and abundant availability of raw material (oil
and gas), the US has the maximum capacity to manufacture
petrochemicals in the world.
In the 90's, demand
in the developed countries grew at 3-4% as compared to the growth
rate of 10-12% in the Asian sub-continent (developing countries).
This led to huge capacity additions in the sub-continent to fill
the demand-supply gap.
In the last decade,
capacities have been built up in most of the Asian countries. South
East Asian countries like Korea, Thailand and Taiwan have built up
capacities much larger than the requirement of their domestic
markets. The current capacity in Asia is 16mn tpa which is expected
to be at 28mn tpa by the year 2000.
China and India are
the two large markets of Asia, the former being the larger one.
China produces only 30% of its requirement. South East and Middle
East Asian countries like Korea and Saudi Arabia, having surplus
capacities mainly export to China and India.
In recent times,
owing to the recession in the South East Asian countries (after the
currency crisis), consumption in their domestic markets has gone
down. Even the buying trends in the Chinese market have dropped
down on account of recessionary conditions. This has left India as
the only available market for the huge surplus of petrochemicals
produced by the South East and Middle East Asian countries. This
has led to a lot of dumping by these countries in India.
