Polypropylene Suffers From Overcapacity.

Chemical Market Reporter, May, 2001 by BROWN, ROBERT

Basell sells 180,000-ton PP plant in the Netherlands to flooring company Domo.

WHILE ITS LONG-TERM outlook remains bright, the polypropylene (PP) market is suffering through a stormy period of overcapacity, weakening demand and margin erosion. Industry leader Basell has mothballed several plants in response to poor returns and has divested others to comply with competition issues raised by the European Commission (EC) at the time of its formation last year. However, despite the oversupply, some PP producers are proceeding with plans to bring on more capacity.

Averaging annual growth of 7 to 9 percent over the past few years, PP producers became accustomed to strong growth and added capacity. Last year producers added almost 3 million tons of new...

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