Chandra Asri Petrochemical to Supply Resins to Toyota Motor Corporation

Indonesia: PT Chandra Asri Petrochemical Tbk (CAP), an Indonesia based integrated petrochemical company, has announced its plans to supply its polypropylene impact copolymer resins to PT Toyota Motor Manufacturing Indonesia (TMMIN). The resins would be used as a raw material for manufacturing automotive components for Toyota models such as Toyota Vios and Yaris. Through this deal, the Indonesia petrochemical industry would foray into automotive component sector, that is mainly supplied with raw materials by other countries with international standards. Further, this step would help the government stimulate the industrial setup of the country by improving the performance of compounding and moulding sectors consisting of PT Hexa Indonesia, which offers resins with additives and colours and PT Sugity, involved in moulding resins into automotive components. CAP also plans to expand its polypropylene impact copolymer production from 480,000 metric tons to 580,000 metric tons.

TechSci Research depicts that the deal will help strengthen Indonesia’s foreign exchange and bolster the demand for domestically produced polypropylene resins across country’s growing automotive sector. As a result, the market for propylene, which finds application in the production of polypropylene will witness a surge at both domestic and global level.

According to the recently published report by TechSci Research, “Global Propylene Market By Application, By Region, Competition Forecast and Opportunities, 2011 - 2025”, the global propylene market is forecast to grow at a CAGR around 6% during 2016-2025, on account of growing industrialization and rising demand for demand for eco-friendly paints across commercial and residential set ups. Additionally, announcements of various emerging OPT plants for propylene coupled with smooth trading practices between countries is boosting global propylene market. Furthermore, polypropylene is projected to dominate global propylene market, on account of increasing government regulations for reducing greenhouse gas emissions in environment supported by tremendous growth in the production of light commercial vehicles and packaging industries. Few of the leading players operating in global propylene market include Sinopec Corp., CNPC and ExxonMobil Corporation, among others.