The global demand for PTA from polyesters has grown at an annual average of slightly more than 5% since 2005. Historically, The PTA market has exhibited high growth and strong investment before the economic crisis from 2005 - 2008. Most of the new projects were in China due to removal of tarrifs by the WTO which caused an oversupply situation. The strong demand growth and low operating rates were not able to offset the increase supply due to increase in number of producers.
The main growth driver is the polyester fibres; the bulk of this is now produced in China. In Western Europe and North America, PET packaging resin is the major driver for PTA growth. On a global scale, Asia-Pacific accounts for the largest Producing and Consuming region. PTA has historically witnessed fast growth owing to versatility, cost 2-3 time lesser than Nylon, performance and comfort.
Purified Terephthalic Acid (PTA) is an organic compound which is primarily consumed in the production of linear, saturated polyester resins and is produced from paraxylene (PX); end product of crude oil. The fluctuating prices of crude oil and increasing environmental impact of paraxylene are some of the restraining factors for the PTA market.
PTA exhibits excellent properties such as chemical and stain resistance, hardness, flexibility, glass transition temperature range and weathering. Some of the eminent drivers for the growth of PTA market include rapid industrialization, rising demand of solvent free and environmental friendly powder coatings and in food & beverages packaging. Asia-Pacific and Middle East and Africa are estimated to be the leading regions owing to expanding food & beverage industries and rapid industrialization. North America, Europe and Latin America have been estimated to witness sluggish PTA demand for PET resin segment as these regions are focusing on developing new methods for recycling the existing waste PET bottles.
Historically China has had four companies Petrochina, Sinopec Shangahai Petrochemical, Yangzi petrochemical and Yizheng chemicals fiber and together they accounted for majority of the PTA production capacity before 2000. There was a change in this scenario after 2000 as series of new plants were constructed by the upstream business, government incentives and foreign direct investements (FDI) resulting in a sharp growth in the name plate production capacity. Most of the bigger players in the region are of Sinopec affiliates.