Page 177 - CW E-Magazine (2-1-2024)

Annual GpcA Forum

DISPARATE TRENDS

Circular solutions and virgin materials to have

separate market dynamics

Two distinct markets are developing
for low carbon circular solutions and
the traditional virgin materials market.

“There is lot of talk of a premium
for circular solution over gas- or oil-
based polymers. That is not how it’s
going to work, because the supply and
demand for these circular solutions –
till at least 2035 – will have its own
dynamics. That market will set its own
prices and it’s not going to be priced
based on fossil-based plus a premium,”
said Mr. Peter Vanacker, CEO, Lyon-
dellBasell, during a CEOs fireside chat.

Mr. Bruce Chinn, President and From L to R: Dr. Bernd Elser, Mr. Peter Vanacker, and Mr. Bruce Chinn
CEO, Chevron Phillips Chemical, said Mr. Vanacker observed that the for a sustainable future and are not
the industry would have to work on global demand for circular products is going to be replaced in the foreseeable
developing the circular solutions mar- slated to be 15-mt and supply is esti- future. In mature economies, maybe
kets, and help downstream customers mated at 10-mt by 2030, indicating a around 50% of the growth is going to
understand the value products bring. supply shortage. be in circular solutions, he added.
“The consumers of virgin polymers
would want the circular products to be He said that at LyondellBasell’s “It is going to take time to build up
available at the same price and that’s catalytic recycling plant being built in a profitable circular & low carbon solu-
not realistic right now,” he said. “Over Germany to convert plastic waste into tions business and to create sustain-
time the market will develop, the attri- feedstock for production of new plastic able value with that business,” he said.
butes of circular products will be clear materials, a big part of the production Dr. Bernd Elser, who leads Accenture’s
and the price setting will happen,” he volumes has been sold already “not at a global Chemicals and Natural Resour-
added. premium, but as a separate product with ces practices and was the moderator for
its own value.” the fireside chat, said various reports
Mr. Chinn stressed that it would suggest that as much as $200-bn worth
be much easier to set a premium when Mr. Chinn said collaboration would demand has been estimated for sustain-
products are in scarcity. But as more of be key to driving the circular economy ability-related chemicals by 2027. Later,
the product becomes available, there forward and, in this context, highligh- speaking specifically about the Gulf
will be pressure, as in any market, to be ted the joint effort of Chevron Phillips Co-operation Council (GCC) region,
a low-cost producer. “The availability Chemical, Technip Energies and Lyon- Mr. Chinn said demand for virgin and
of feedstocks will be key to how the cir- dellBasell on the design, construction circular polymers is expected to be
cular economy develops in the future,” and operation of a demonstration unit strong and the GCC is well-positioned
he noted. for Technip Energies’ electric steam to provide feedstocks and has access to
cracking furnace technology, designed wider geographies. “This region is well
“We need to engage with the entire to cut the greenhouse gas emissions as- positioned because it plays an impor-
value chain,” he said, adding waste man- sociated with olefins production. tant role in providing feedstocks and
agement infrastructure is going to be key it has access to markets, whether it be
way to evolve the circular economy. Mr. Vanacker said plastics are needed Europe or Asia,” he said.

Chemical Weekly January 2, 2024 177

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