The conference was attended by over 100 delegates, a success difficult to achieve in the present market situation. A general view was that the conference was a success with a number of interesting issues raised and discussed.
There was a general consensus that the market in central, eastern Europe and the Balkans had contracted over the past two years following the banking and credit crisis that had eroded consumer confidence and removed the buyers’ ability to purchase product on credit. However there was cautious optimism for the future, with forecasts that were at least positive for the coming years. The sovereign debt in many countries remained a concern in projecting just how much consumer spending power would stimulate growth in packaging. The supply demand balance was forecast to remain in general oversupply, even before the spate of expansions that were either definite projects or just on the planning board. Most of these new plants were in the Middle or Far East, particularly China where the growth in supply continued to outstrip the growth in demand.
The recent imposition of provisional anti-dumping duties on imports from Pakistan, UAE and Iran provided the basis for divergent views from the resin producer aspect and the converter side of the fence. It was felt by many delegates that such imposition could influence a shift towards producing performs in several periphery countries, such as Morocco, Egypt, Turkey and the Ukraine, the latter where they have capitalized on the differential in costs between importing performs and resin. However creating such a shift in trade flows would take time so the immediate effect of the anti-dumping would be to reduce the levels of imports from these countries into Europe.
Presentations suggested that the market across the region was starting to expand again after the low point in 2009, but the projections for 2010 were still below the level reached in 2008. It was clear that the resin supply to converters was served to date largely by imports from the Far and Middle East, but that this pattern is likely to change as a consequence of the antidumping. However the future is now unclear as to the origin of continued supplies. The applications for performs concentrated more on other end uses than the traditional CSD and water markets, with milk and non food applications coming to the fore. Milk seems to have grown in prominence as an application in this region.
Research and development continues apace on the resin side with more barrier resins coming onto the market. M & G have developed a new resin with a separate barrier layer imbedded in the resin that can be injection moulded and blown as though it is a mono-layer resin. The performance was presented as being the same if not better as multi-layer bottles. M & G are offering this resin exclusively.
A clear message from the conference was that environmental issues relating to the use and recycling of PET bottles was a growing concern to all participants in the supply chain. A continuing shift to lighter bottles, thus using less PET, either through wall thickness or lower neck heights, and the increasing need to include RPET in formulations were among the options suggested. Another option was promulgated by Coca Cola in their objective of shifting the raw material sourcing away from oil based towards sustainable sources; the sources as yet unclear. This objective included both the major raw materials, PTA and MEG with much innovative work continuing in this field.
Development of new uses for PET continues, especially in the use of R-PET where Arel, the sister company of SETA who recover PET from the recycle stream, are finding alternatives uses in the engineering polymer fields where R-PET blends with PP or glass fibre are matching technical performance at a fraction of the cost. Inroads into the market for large containers in competition with products such as PC and HDPE continues apace with Siapi introducing some novel designs to introduce some competitive edge for PET containers.
Overall the mood of the conference was one of optimism, with slow emergence from a torrid time experienced by all sectors of the supply chain over the last couple of years. However this mood of optimism was tinged with caution as the anticipated upturn could have some surprises in terms of dips in the growth curve over the short to medium term.
Mervyn Toogood, Senior Consultant
PCI (PET Packaging, Resin and Recycling) Ltd
BMJT ~ 24th June 2010