Nexant Issues New Global Polyolefins Technology Review

Jan 26, 2012
Nexant’s Annual POPS Technology Review Is the Industry-Leading Benchmark

LONDON AND BANGKOK – Nexant, Inc. announced today that it has released its PolyOlefins Planning Service (POPS) 2011 Technology Review, the latest in its annual series of comprehensive polyolefins industry technology reports.

Nexant’s POPS technology review comes at a time when the industry has been impacted by a number of plant closures that have occurred simultaneously with new capacity startups. In addition, despite the ongoing development and promotion of high-performance resins, the industry is becoming increasingly commoditized, with purchasing decisions made on the basis of costs. Production economics for polyolefins show notable disparities both within and between regions, all of which influence market behavior, investment, and consolidation.

As the industry attempts to deal with these major challenges, it becomes more important than ever for companies to have a clear strategic view of the latest polyolefins technology options and opportunities. These technology developments continue to redefine state-of-the-art products and processes throughout the industry. 

At this stage, companies are primarily focused on cost reduction and commercialization of new technologies and products. Technology continues to be a strategic differentiation as companies jockey for a leadership position. These dynamics, coupled with the industry’s continued competitive pressures, have heightened the competition between technology holders and producers. As a result, companies need a better understanding of the global landscape as a prerequisite for understanding their own technical and commercial positions.

One key development over the last few years has been the dramatic increase in single-line capacity size. In an effort to reduce unit-operating costs, technology licensors have continued to increase reactor capacity, with most licensors offering single-line capacities of at least 400 thousand tons (882 million pounds) per year for polyethylene and polypropylene.

However, there are disadvantages to increasing single line capacity, such as problems managing grade flexibility (e.g., transition material quantity), greater inventory requirements, and product/feedstock logistics (i.e., if the line goes down and production stops, the feedstock plant may be disrupted). In addition the optimum plant size in a given market may not necessarily be the largest single-line capacity, although this of lesser importance in highly advantaged export regions. 

While the investment cost per ton of product typically reduces with increased capacity, there may also be higher operating costs (caused for instance by increased catalyst costs due to shorter reactor residence time). In addition, the number and variety of grades to be produced will also affect the optimal size. Since a larger reactor will result in more transition material than a smaller reactor, inventory management becomes more problematic at larger scales. Also, the maximum single reactor line capacity for some licensors is larger than the single-line extruder capacity, resulting in the need for parallel pelletizing lines. The current technical limitation for true single-line capacity for both polyethylene and polypropylene is governed by this limitation on extrusion and pelletizing equipment sizing.

In addition to ongoing process improvement, there are other key technology issues facing the industry—such as industry consolidation, which has reduced the number of third-party licenses available, while increased plant scale has also reduced the number of individual licenses that need granting in any given period (despite an increase in the number of technologies available for license).

The POPS 2011 Technology Review presents Nexant’s analysis of developments in polyolefin technology and how these changes are likely to affect the polyolefins business. It addresses the fundamental drivers of technology development, including:

  • Product development—resins for new applications, product substitution and application specific improvements
  • Process technology—impact of increasing plant scale and the evolution of new technologies
  • Process chemistry—focuses on new catalysts, modified formulation and increased yields
  • Other issues—such as trends in technology licensing and impact of steel pricing

Nexant’s polyolefins technology review is essential reading for companies concerned with their competitive situation. The analysis includes technology-by-technology benchmarking, plus descriptions of the latest enhancements and developments in each technology. Each major licensor has been encouraged to review and update its information, and every technology profile has been revised with the most recent information and data publicly available.

For additional information on the POPS 2011 Technology Review please visit or contact: Paul Willbourne, +44 20 7950 1599,