According to the latest report from research and consulting firm GlobalData, Global polypropylene capacity increased at a compound annual growth rate (CAGR) of 5.2% from 2003 to reach 65 million tons per year (mtpy) in 2013. It is expected to continue rising to 86 mtpy by 2018, at a CAGR of 5.8%, GlobalData said.

The report said that China and Russia will be the leading contributors to future polypropylene capacity increases, accounting for a combined 45% of global additions over the next five years.

China will be the leading contributor to growth, with an expected 7.48 mtpy of additions, 97.6% of which will come from new plants, according to Carmine Rositano, GlobalData’s managing analyst covering downstream oil and gas. “A demand-side push is driving additional capacity in China, forcing it to produce more domestic polypropylene,” said Rositano. The report forecasts that the country will account 62.4% and 35.5% of planned Asian and global capacity increases by 2018, respectively.

GlobalData expects Russia to be the second largest contributor to growth, mainly due to its recent diversification into the petrochemicals sector, which has seen substantial investment in bulk polymer industries like polyethylene and polypropylene.

“Until 2012, Russia’s polypropylene capacity was only 0.65 mtpy, but this increased to 1.33 mtpy in 2013 and is further expected to reach approximately 3.48 mtpy by 2018, with all additions coming from new plants,” Rositano said.

The report also said that Venezuela and India will be the respective third and fourth largest contributors to capacity increases over the next five years, with both countries investing in the polypropylene sector to replace imports.