Fri, 23 March 2012

MUSCAT -- The plastic manufacturing sector is recording a boom in the GCC due to its dependence on products of refineries and petrochemicals. The sector witnesses an annual growth between 9 per cent and 11 per cent at the GCC level, while it is estimated that the percentage growth in the Sultanate is still between 3 per cent and 4 per cent.

In the Sultanate, there are 50 small and medium projects currently in the field of plastics in addition to two projects in Sohar and Salalah that are considered major projects in the fields of 'propylene and polyethylene'.

These projects play a vital role in the provision of basic and raw materials for the establishment and the development of medium and small industries in this area.

At the corporate level, the huge government spending on infrastructure projects raises the demand for plastic products and other industries based on oil derivatives.

The industry experts see further growth in the sector with the increase in personal consumption of plastic in the region so that it will climb to the second position in the world by 2020 through the replacement of non-plastic products, which are not produced locally but imported from foreign markets like paper and wood.
With the attempts of the
Sultanate to pump huge investments in oil refineries and petrochemical sector, industries on plastic began growing especially as there is a global demand for these products. Among the local companies operating in this sector is the Gulf Plastic Industries Co, which indicated in its financial report last year that it achieved a return on sales amounted to RO 4.434 million compared to RO 3.586 million for the same period last year. The rate of increase was 23.65 per cent.

It achieved a gross profit amounted to RO 523.428 compared to RO 522.931 in 2010 and net profit of RO 195.393 compared to RO 138.463 in 2010.

On the operational indicators, the company said that 2011 saw a recovery in the global economy which led to the increase in prices as well as increase in sales volume, but these increases were not enough to offset the increased costs as the company responded to the decisions of the country to increase the minimum wage, especially with increasing energy prices around the world.

New markets
The company pointed out that all the production lines of the company, the lines of bags and large bags and small cups, and bags of polyethylene have achieved a growth in production and sales, which in turn helped to stabilise the company's profits last year.

The company focused in particular on opening new markets for their products and increasing the marketing departments to reach the markets of Oman and the Gulf and the international markets as the company entered the US.

The company said that the demand for its products of the large bags in Oman, Gulf and international markets witnessed remarkable growth and the company is looking to take advantage of this in addition to the process of packaging, polypropylene bags and bags of polyethylene and cups, which in turn keeps the increase in demand in the consumer market. It is hoped that the activity in the construction of infrastructure facilities and high oil prices will increase economic activity in the region.
The company experienced growth rates that contributed to an increase in the chances of the company to enhance its activities.

It is expected that the size of the annual production of plastic will grow in the Gulf by 73 per cent from its current levels by 2015, up from 13.6 million tonnes to 23.6 million tonnes.
The GCC countries in general, has become a major player in the list of exporters of petrochemicals and plastics in the world thanks to its position in the field of global oil production.

According to the latest statistics, the production of the Gulf Co-operation Council for polyethylene will increase from 7.1 million tonnes in 2009 to 5.21 million tonnes in 2015 and the production of polypropylene will increase from 8.4 million tonnes in 2009 to 5.9 million tonnes by 2015.

This will help to increase the production rate of the region of the material derived from polo levin to more than 31 million tonnes by the year 2015.

© Oman Daily Observer 2012