China's development of coal-to-olefin technology may change the dynamics of the global polyethylene market

If the development of coal-to-olefin (CTO) technology in China continues in the next five-year plan, the global polyethylene (PE) market is likely to be saturated with materials by 2019, as every report by Platts Energy Information. More than 30 coal-to-olefins and methanol-to-olefins projects are likely to flow in China by 2020. These new plants are expected to add more than 100,000 metric tons of ethylene to the Chinese market. The Platts Shale-to-Polyethylene report indicated that the expected amount of ethylene produced in China from coal to olefins was converted to match the amount of ethylene produced from projects connected to shale gas to develop new steam crackers in North America. The report data shows that China is not only increasing ethylene production capacity, it is adding additional polyethylene production capacity of more than 140,000 metric tons between 2014 and 2021, most of which are fed ethylene produced from coal to olefins. The report looks at the world-wide development of new ethylene and polyethylene production and clearly states that new Asian production capacity-most of which is China-will reach the global market in North America in the future with new production plans. The largest gain in capacity is expected in the Americas when the new shale-based production flow will occur in 2017 and 2020, where every two years will rarely see an increase of more than 20,000 metric tons, but in 2015 and 2016 In addition, Asia's PE production capacity has climbed by more than 7 million metric tons. The report shows that the influx of Asian materials will exceed 50% and may increase the global polyethylene surplus from 2013 to 2015. The global surplus of plastics is expected to climb to more than 7 million metric tons between 2016 and 2018.