In 2021, the acetone business slowed down compared to 2020 due to less tight market conditions. However, the supply decreased according to the situation of phenol production from the above factors. However, demand for isopropyl alcohol (IPA), methyl methacrylate (MMA), and other related industries was quite slow. In 2021, the average acetone product price was US$ 862 per ton, or an increase of US$ 64 per ton, or 8% compared to 2020, as a result of raw material prices driving up product prices in the petrochemical market. In 2021, the Bisphenol A (BPA) business was at a record high on the impact of the Polar Vortex phenomenon in the United States. As a result, the market for epoxy products, which were downstream products, became tight, and prices increased dramatically coupled with the demand for wind turbine production in line with clean energy policy and carbon emission reduction in Europe, the US, and Northeast Asia, especially in China. In addition, there was the postponement of commercial production with a total production capacity of more than 610,000 tons per year. From the above factors, the price of bisphenol products was increased at an average of US$ 2,889 per ton, or increased by US$ 1,501 per ton, or 108%, and the difference between the product and raw material prices was at the average of US$ 1,649 per ton or increased by US$ 1,118 per ton compared to 2020. FORECAST FOR THE PHENOL MARKET IN 2022 In 2022, the phenol business is expected to maintain a high-profit margin but may be weakened from 2021. Although supply in the first and second quarters remained tight due to the factory shutdowns in Northeast Asia, there will be more new supply, especially from China, with a new capacity to be added in 2022, initially at 330,000 tons per year (Effective capacity), while demand is expected to increase from BPA products and Cyclohexanone products that have greater demand due to economic recovery and growth in alternative energy businesses such as wind turbines. The acetone business in 2022 is projected to weaken slightly as a result of plant expansion in China while the demand is expected to improve as the economy recovers from the COVID-19 pandemic. However, the profit margin of acetone shows signs of weakening due to the expectation of consistently lowered price of downstream products. In 2022, the Bisphenol A (BPA) business is expected to weaken from 2021 due to an additional 930,000 tons of effective capacity from China, including 610,000 tons per year of new supply at the end of the year. The demand is expected improve with economic recovery and growth of alternative energy business, namely wind turbine. MARKET OVERVIEW – POLYMERS In 2021, the polyethylene (PE) market was better than in 2020, with global demand for PE products increased by 5.7 million tons to 115.3 million tons from 109.6 million tons, or 5.2%, due to the relaxation of the COVID-19 pandemic control measures around the world. This was a factor that increased the demand for PE products. Meanwhile, the production capacity of PE products increased by 7.4 million tons to 133.2 million tons from 125.8 million tons or 5.8%. Factors affecting PE product prices in 2021 included the tight supply of raw materials and petrochemical products worldwide during Q1 to early Q2 after US manufacturing disruption due to the Polar Vortex’s impact, resulting in higher PE product prices. Until the end of the third quarter, the steady freight and container shortage impacted global supply chains. The Chinese government announced the Dual Control Policy, causing manufacturers in China affected by such measures to halt or cut their production capacities. However, the COVID-19 pandemic continued to be a key force on PE product prices throughout 2021, resulting in the average price of HDPE and LLDPE in Southeast Asia in 2021 at approximately $1,181 and $1,200 per ton, an increase of approximately 302 from 2020; 301 and 333 US$ per ton respectively. For LDPE products, the average price was around 1,516, increasing around $506/ton from 2020 due to tight supply conditions throughout the year. HDPE, LLDPE, and LDPE over naphtha spread in 2021 were US$ 536, 554, and 870 per ton, rising from US$ 36, 67, and 240 per ton in 2020, respectively. In 2021, the polypropylene (PP) market was volatile from a continued decline in supply from the US., which were PP exporters to the South American market. As a result of the Polar Vortex phenomenon, the petrochemical plants were halted. while the ocean export volume among regions decreased, as the volume of available containers and ships decreased, PP supply from Asia, with the increase in volume from the new capacity, could not be exported to markets that experienced PP shortages or markets with the increase in PP demand, such as South America, the United States, or Europe 64 PTT GLOBAL CHEMICAL PUBLIC COMPANY LIMITED Form 56-1 One Report 2021
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