Polycarbonate Capacity Increasing in Asia Due to Regional Demand

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Researched by Industrial Info Resources East Asia (Kofu-shi, Japan)--Polycarbonate, a thermoplastic polymer known for its workability and ease of thermoforming, is in demand in developing and emerging economies. This holds especially true in Southeast Asia and parts of East Asia. China, in particular, is currently the largest primary driver for demand. Places like Japan, the United States and Germany are experiencing some recovery in polycarbonate demand, but no large capacity increases are expected. Along with chemical processing, Asia represents the largest number of projects and investments in other industries, including petroleum refining and power.

Due to its versatility, polycarbonate is used in a variety of applications. In the electrical and electronics sectors, the largest consumers of polycarbonate, it's used primarily as an electrical insulator and a heat or flame retardant. The construction sector, which utilizes polycarbonate in sound walls and glazing, is also poised to become a significant consumer as well.

Asia is one of the top leaders in electronics and electrical equipment, and Southeast Asia, Vietnam in particular, is experiencing a construction boom. Two years ago, Asia represented more than half of the global demand for polycarbonate, and annual growth is estimated to reach 5% from now through 2015.

As of now, Industrial Info is tracking the development of nearly 1.5 million metric tons of new annual capacity throughout Asia. Most of these capital projects, which are worth approximately $4 billion, are under development in China. This includes one of the largest tracked capacities in the form of a unit addition.

China currently represents half of the polycarbonate projects investments in Asia, while South Korea accounts for another quarter via one project. Cheil Industries Incorporated (SEO:001300) (Gumi, South Korea) recently began construction on a $1.4 billion plant expansion at its Yeosu polycarbonate plant. Including the Yeosu expansion, approximately 170,000 metric tons' worth of annual capacity is currently under construction, while the remainder is scheduled is start next year.

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