Saudi Petrochemicals - NCBC

INDUSTRY OUTLOOKEvident in exhibit 15, the propylene surplus has gradually increased in recent yearsas supply grew at a CAGR of 3.0% during 2003-2008, outpacing the consumptiongrowth of 2.9% during the same period. The increased focus of Middle Easternpetrochemical players on propylene is set to further disturb the equilibrium betweendemand and supply amidst anticipated demand weaknesses in the near to mediumterm.We project propylene prices to increase at a CAGR of 4.9% during 2009-2015E, slower than the price recovery in ethylene. Polypropylene prices areexpected to track the trend followed by propylene and expand at a CAGR of 4.1%during the same period.Exhibit 16: Propylene and polypropylene prices (historic and forecasts)USD/mt2,2502,0001,7501,5001,2501,0007505002500200520062007200820092010E2011E2012E2013E2014E2015E2016E2017E2018EPropylenePolypropyleneSource: Bloomberg, NCBC Research estimates27 April 2010 SAUDI PETROCHEMICAL SECTOR16