Page 130 - CW E-Magazine (3-6-2025)

Point of View
FOR YOUR COMPETITIVE AND DIRECT IMPORTS FROM OUR ACCREDITED OVERSEAS
MANUFACTURERS FOR THE ITEMS AS UNDER:-
South Korea – falling profitability
Historically, South Korea has been a leader in producing ethylene through naphtha cracking and exporting high-value-added processed 1-Bromo-3-Chloropropane Dimethyl Acetyl Succinate
products. Here too, China’s push towards self-sufficiency has significantly impacted South Korean exports, and profitability.
1-Propanephosphonic Acid Cyclic Dimethyl Succinylo Succinate
The country’s petrochemical giants, including LG Chem, Lotte Chemical, Hanwha Solutions, and Kumho Petrochemical, have seen profits Anhydride Ethyl-4-Chloroaceto Acetate
dwindle. In 2022, their combined operating profit totalled $2.98-bn, but this plummeted to $1.6-bn in 2023 and just $163-mn in 2024. Experts
agree the crisis is structural rather than cyclical and requires comprehensive institutional reform and financial support from the government. 2,3-Xylidine Hydroxyacetone
Some promises have been made, but no concrete proposals have been forthcoming.
2,4-Xylidine Iron Oxide Red
While Japan is the world’s oldest society (with 30% of its population over the age of 65), South Korea presently has half that share, but
the fear is that it is going the same way. The contraction in the petrochemical industry in the former may portend what may come to the latter. 2,6-Xylidine Isododecane
3,4-Xylidine Isopropyl Alcohol
Taiwan – regional competition takes a toll
According to data from the Petrochemical Industry Association of Taiwan, the country’s ethylene capacity is about 4.0-mtpa, while 4-Nitroacetophenone Isopropyl Chloroformate
its propylene capacity is about 3.4-mtpa. In 2024, production of major petrochemicals dropped 2.39%, exports were down by 4.3% and
demand fell by 1.1% from the previous year. 4-Nox Malononitrile
5-Ethyl-2-Methylpyridine Ortho Nitrotoluene
And the prospects for 2025 also seem grim. Weak downstream demand and regional competition are expected to keep cracker utilization
rates in the range of 60-70% in 2025. Symptomatic of the industry’s travails, Formosa Petrochemical, a leading producer, has been operating Benzaldehyde Orthophthalodinitrile
just one of three crackers, citing poor demand and unhealthy margins.
Benzyl Alcohol Para Nitrotoluene
India – a lone bright star
Amongst all the gloom, India is seen as an exception, with demand expected to continue to grow for the near-term, though possibly Creapure Phenothiazine
slower than hitherto. Growth will be driven by demographics and rising aspirations of the expanding middle class, as well as investments Cyanuric Chloride Thiophenol
in industrial sectors such as automobiles, infrastructure and construction, among others. The Chemicals and Petrochemical Manufacturers’
Association, an industry lobby group, reckons India’s petrochemical industry has entered a new phase of growth, manifest in a slew of projects. Diisopropyl Ether Transglutaminase Enzyme
The first of these to come online in the next few months will be the refinery and petrochemical complex being set up by HPCL Rajasthan
Refinery Ltd. (HRRL), a joint venture between Hindustan Petroleum Corporation Ltd. (HPCL) (74% stake) and the Rajasthan State Government PLEASE CONTACT WITH YOUR SPECIFIC REQUIREMENTS
(26%), at Barmer. This dual-feed cracker will have the capacity to produce 820-ktpa of ethylene, 400-ktpa of propylene, aromatics (benzene &
toluene), and polyolefins. Mechanical completion is expected by September this year, with full operations anticipated by December. CHEMET

Another project also expected to go online this year is a propane dehydrogenation (PDH) unit being built by gas major, GAIL India Ltd.,
at Usar (Maharashtra) at a cost of $1.2-bn. This unit will have a nameplate capacity of 500-ktpa for propylene and matching capacity for
polypropylene. GAIL has selected US engineering company Lummus Technology and Switzerland-based specialty chemical firm Clariant for HEAD OFFICE : Span Centre, 2nd Floor, Ramakrishana Mission Road, Santacruz(West), Mumbai - 400 054, INDIA.
catalyst supply. Further down the line is a similar project from Indian Oil Corporation (IOC), India’s largest refiner. Tel : +91-22-66802222 / 26045601 E-Mail : info@chemetindia.com Website: www.chemetindia.com
BRANCH OFFICES
Petrochemical projects in India are also recalibrating feedstock choices to include ethane imported from the US.Ethane-based crackers AHMEDABAD OFFICE : 1101, Safal Prelude, HYDERABAD OFFICE : Flat No. 104, K1 Primo,
have the lowest cash cost position for ethylene and though importing it does add to costs due the complex logistics, it is still an attractive Corporate Road, Nr.Prahladnagar Garden,
option. Reliance Industries Ltd. was the first to get on this act and is now one of the largest importers of ethane in the world. And others are Kondapur X Roads, Hanuman Nagar, Kondapur,
set to follow. ONGC, for one, is eyeing import of 800-ktpa of ethane for its dual-feed cracker at Dahej, which is operated by its 95%-owned Anandnagar, Ahmedabad - 380 015, INDIA. Hyderabad-500 084, Telangana, INDIA.
subsidiary, ONGC Petro-additions Ltd. The cracker currently runs on a mix of naphtha and C2 (ethane), C3 (propane) & C4 (butane) feedstock. Tel : +91-79-40370725 Tel : +91-40-4856 5970 / 71
ONGC has recently expressed an intent to partner with firms that will operate and manage Very Large Ethane Carriers, Very Large Gas Carriers E-Mail : chemetahmedabad@chemetindia.com E-Mail : chemethyderabad@chemetindia.com
and Liquefied Natural Gas Carriers. The government – prodded by industry participants – is believed to have offered to slash import duties on NEW DELHI OFFICE : 214, Hans Bhavan,
US ethane from 2.5% currently to nil. While this is being offered as a sop to partly correct the ~$46-bn trade surplus India has with the US, it Wing No.1, Bahadurshah Zafer Marg, KOLKATA OFFICE : Sharma House, 3rd Floor, 1/2, Lord
will also improve the competitiveness of crackers here that use ethane as feedstock. New Delhi - 110 002, INDIA. Sinha Road, Kolkata - 700 071, INDIA.
Tel : +91-11-45751865 Tel : +91-33-22827247 / 22826511
While the new petrochemical capacity coming in the short-term is welcome, growing demand will necessitate continued imports, and E-Mail : chemetdelhi@chemetindia.com
many more projects are needed. Configuring them for commercially viability in a challenging external environment will require investors E-Mail : chemetkolkata@chemetindia.com
to make astute choices when it comes to size, location, level of integration, technology and feedstock, as well as supportive government CHENNAI OFFICE : 8-J, Century Plaza, 560-562,
policies that ensure imports – from the region and beyond – at predatory pricing are kept at bay. Anna Salai, Teynampet, Chennai - 600 018, INDIA.
Tel : +91-44-24342245 / 24349301
Ravi Raghavan E-Mail : chemetchennai@chemetindia.com

130 Chemical Weekly June 3, 2025

Contents Index to Advertisers Index to Products Advertised