Experts have predicted a two-fold increase in polymer output in Russia by 2035

Production of basic polymers in Russia (polyethylene and polypropylene) will more than double by 2035 - from 5.4 million tons in 2023 to 12.9 million tons. This conclusion was reached by analysts of the consulting company Kept in their new industry study on the prospects of the Russian petrochemical industry, published on November 28.

According to the materials presented, per capita consumption of polyethylene and polypropylene in Russia will increase from 30 kilograms per person to 48 over the period, which will bring Russia to the level of developed countries.

"The main demand will be provided by the packaging industry (packaging for e-commerce), the construction industry (water and gas pipes, thermal insulation), the automotive industry (interior cabin interiors, bumpers, tanks, etc.) and the medical sector (sterile packaging, equipment)," experts note.

Kept predicts that companies will continue to invest in the expansion of basic polymers production capacities, and among the most promising projects in the medium term they single out the Amur Mining and Chemical Complex in Khabarovsk Krai (a joint venture between Sibur Holding and China's Sinopec, already 60% built) and the Baltic Chemical Complex in Leningrad Oblast (a project with the participation of Gazprom). It is expected that by 2030, when these facilities are completed and reach full capacity, the volume of ethane consumption in Russia will grow sixfold. This material is the most efficient feedstock for the production of ethylene and its derivatives, and such growth will provide additional competitive advantages for the Russian industry.

Analysts also expect that in the future Russian producers will continue to reorient polypropylene and polyethylene exports from EU countries to Turkey, China, Southeast Asia, and CIS countries. Due to China's capacity expansion, the least efficient producers with the highest production costs in the PRC itself, Japan, South Korea, Taiwan and Western Europe are at risk of closure. However, Russian producers have found themselves in a more favorable position in both domestic and foreign markets due to access to raw materials in their home market and government support, including a reverse excise tax on raw materials for the petrochemical industry.

The petrochemicals industry has been undergoing a new phase of active development in Russia since 2018 due to the fact that domestic producers have significantly increased production capacity and output. For example, the largest polymer production complex since the collapse of the USSR, ZapSibNeftekhim in Tobolsk (part of Sibur Holding), was launched during this period.