JEDDAH – Saudi Arabia is likely to be the preferred location for development of polymer downstream industry due to its large consumer base and easy availability of raw materials, Frost & Sullivan said in its report “Strategic Analysis of Polypropylene (PP) Downstream Applications in the GCC Region”. Local suppliers are likely to develop niche product grades that target specific applications in line with the development of the PP downstream industry, the report noted. More polypropylene suppliers are expected to venture into different downstream applications and expand their portfolio. It observed that over the last few years, the polypropylene downstream market in the region has witnessed a surge in demand for polypropylene films for packaging and polypropylene carpets. Strong government support in the Gulf Cooperation Council has contributed to the development of polypropylene (PP) downstream industries. Polypropylene films consume film-grade polymer resin and polypropylene carpet yarns consume fiber-grade polymer resin. The growth of downstream applications such as films, nonwovens and geotextiles is expected to bolster PP demand in GCC countries, which have long been a net exporter of PP due to minimum local use, it noted. The new Frost & Sullivan analysis said the total PP resin market for local conversion in the GCC earned revenues of $983.1 million in 2011 and estimates this to reach $1,366.0 million in 2016. The key end-user segments covered in this research are bi-axially-oriented PP films, casted PP films, carpet yarns, nonwovens, geotextiles, woven bags, injection molding grade and PP in automotive sector. This study analyses market opportunities (in terms of supply and demand), trends, future growth potential and competitive scenario in detail for each of these downstream applications. It culminates in the identification of promising and best target opportunities for local conversion of PP in the GCC region. The demand for polypropylene, being consumed in different end-use application in the region, is expected to witness a CAGR of 6.8 percent between 2011 and 2016. The market for polypropylene films is well developed, with a high rate of production catering to local and export markets as well as new capacities in the pipeline. In the future, the packaging application will continue to drive the local demand for polypropylene resin in terms of volume. The end-use application to witness highest growth in the region is likely to be nonwovens, due to higher disposable income and changing preferences leading to the market growth of hygiene products which consumes a majority of polypropylene nonwovens produced in the region. Polypropylene injection molding grade is expected to witness good growth, which can be attributed to the growing population, which in-turn creates new housing projects and subsequent requirement for home appliances, and food and beverage products, F&S said. – SG
