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Investment boom in Chinese BOPP sector

Article-Investment boom in Chinese BOPP sector

Guangzhou, China — The Chinese BOPP sector is gearing up for a new wave of investment after a relatively quiet few years, expanding from 1.8–1.9 million tonnes in 2006 to 2.2–2.3 million tonnes this year. Total capacity on the mainland at of the end of 2006 stood at around 2.2 million tonnes.
Phillip Chen, managing director of Brückner Far East Ltd. (Hong Kong) says 18 to 20 lines are likely to be installed in China this year. From a machine supplier’s perspective, Chen says they would prefer if the market was more stable year to year but in China, investment tends to come in waves. “The same thing is happening for BOPET,” he adds.
Most new BOPP lines destined for China are configured for high-speed extrusion of 18–20-µm film and are 8m in width. Conversely, extrusion of thick film is proving more popular in China right now as it is easier to process. “Profit margins may be lower but higher output means the same profit is achieved,” says Chen. To cater to both markets, Brückner configures its lines for either thick- or thin-film production.
Growing demand in China is good news for BOPP processors located elsewhere. “Chinese processors are enjoying better margins locally and are less interested in exporting,” notes Chen. Previously, up to 25% of Chinese BOPP production was exported due to overcapacity. Outside of China, new BOPP investments are expected in South America, the Middle East, and India.—[email protected]
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