Perspective on China’s BOPP

A new study on the 3.2Mt world BOPP film market by PCI Films Consulting concludes that the effect on the world supply/demand balance of planned capacity increases in China may not be as dramatic as some fear. China currently has around 900,000t of capacity to produce BOPP film but is only running at an estimated 72 per cent utilization level. Publicized plans to install another 400,000t over the next two years represent a 44 per cent increase in Chinese capacity and around half of the world’s increases in capacity over the same period. Many industry players are asking: “Where is it all going to go?”

Study author Simon King explains: “The numbers certainly look dramatic, but our research and analysis suggests that the reality will be different. Firstly, we don’t believe all of the announced sales contracts will come to fruition; secondly, those projects that are implemented will take two-three years to reach full utilization. Thirdly, with Chinese demand for BOPP films growing at over 10 per cent/year, within two years a large proportion of the extra capacity could be absorbed by the growth in domestic demand. And finally, China currently imports around 200,000t of BOPP film annually and we see much of this volume being substituted by domestic suppliers in the future. As a result, the rapid expansion of the Chinese BOPP film industry is likely to have little impact on external markets.”

‘The World BOPP Film Market 2002’ covers the world market overall and by region, providing statistical data and trends from 1997 to 2007 on supply/demand balance and capacity utilization. It also profiles the leading producers and examines growth drivers and future prospects.

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PCI Films Consulting