The Five Regions of Latin America

Petro
Chemical
Consultingg
Alliance
The Five Regions of Latin AmericaThe Five Regions of Latin America
by
J O Bühl Vid lJorge O. Bühler-Vidal
SPE Polyolefins 2015 Conference
Houston, TX
February 22 - 25 2015February 22 25, 2015
North Brunswick Los Angeles México D F Bogotá São Paulo Buenos Aires
Polyolefins Consulting, L.L.C.
www.polyolefinsconsulting.com
www.polyolefinsconsulting.comPO 2015 February 22 – 25, 2015
North Brunswick – Los Angeles – México D.F. – Bogotá – São Paulo – Buenos Aires
Bahía Blanca – Mendoza – Santiago – Porto Alegre – Guatemala – Charleston – Houston – New York

Polyolefins Consulting, LLCy g,
member of the Petrochemical Consulting Alliance
 Provides market, product and process technology selection
consulting to the global polyolefins industry, from producers
to extruders, converters and transformers
 Clients are olefins and polyolefins producers; technology
licensors; equipment and additive suppliers; polyethylene and
polypropylene extruders, transformers and converters; end
users; construction companies; investment banks;users; construction companies; investment banks;
international organizations; and professional and trade
associations
 Highly experienced consultants located throughout the
Americas and the world
 Functional and geographic coverage of polyolefins and sectors
PO 2015 February 22 - 25, 2015
 Functional and geographic coverage of polyolefins and sectors
of the petrochemical industry

P t Ch i l C lti Alli
Petro
Chemical
Consulting
 Provides consulting products and services to clients in the
PetroChemical Consulting Alliance
g
Alliance
worldwide petrochemical and plastics industries, combining
local insights with a global perspective
 Members
– Dr. Alfredo Friedlander, Buenos Aires, Argentina
– INovatius ICS, São Paulo, Brazil
– Meem Consulting, Costa Mesa, CA, USA
– Multidynamics Ltda., Bogotá, Colombiay , g ,
– Polyolefins Consulting, LLC, North Brunswick, NJ, USA
– Unisouth SRL, Buenos Aires, Argentina
Th b d t t k f t h i l lt t i th
PO 2015 February 22 - 25, 2015
 The broadest network of petrochemical consultants in the
American continent

F ti l d hi l
Petro
Chemical
Consulting
Functional and geographical coverage
 Highly experienced consultants
located throughout the Americas
A ti
 Professionals specialized in:
– Project planning
g
Alliance
– Argentina
• Buenos Aires, Bahia Blanca,
Mendoza
– Brasil
– Product development and
applications
– Development and selection of
production technology
• São Paulo, Porto Alegre
– Chile
• Santiago
Peru
production technology
– Operations
– Logistics
– Commercialization, marketing– Peru
• Lima
– Colombia
• Bogotá
, g
and sales
– Technology and technical
service for processors
– Guatemala
• Guatemala
– Mexico
• Mexico D F
 Relationships with related and
complementary consulting
firms• Mexico, D.F.
– U.S.A.
• Los Angeles, Houston,
Charleston, New York
C i l l fi d th t h i l i d t
PO 2015 February 22 - 25, 2015
 Covering polyolefins and the petrochemical industry
functionally and geographically

O tliOutline
 Similarities that unite
– Languages
– Economic weight
– Sustainabilityy
 The five regions
– Competing trade blocksCompeting trade blocks
– Unique polyolefin applications
– Project update
PE and PP imports– PE and PP imports
– Processors and end users
O t iti Opportunities
Many similarities and many differences
PO 2015 February 22 - 25, 2015
 Many similarities and many differences

L f th W ldLanguages of the World
Source: Languages world map - Eric Gaba
Note: Blue – Spanish, Portuguese and other romance languages
Largest land mass joined by two major common
PO 2015 February 22 - 25, 2015
 Largest land mass joined by two major common
languages

Economic Weight of Languages with More
Th 100 Milli S kThan 100 Million Speakers
Source: Ethnologue (2013) and World Development Indicators 2013, World Bank
Two major common languages unite Latin America
PO 2015 February 22 - 25, 2015
 Two major common languages unite Latin America

Th M t B l d R i f th W ldThe Most Balanced Region of the World
Index uses global data on life expectancy, experienced well-being and
Ecological Footprint to calculate HPI
Source: HPI - Happy Planet Index (2012)
The region heading to sustainable well living with
PO 2015 February 22 - 25, 2015
 The region heading to sustainable well living with
relatively low ecological footprint

Countries and Economies
G D ti P d t 2013 C t US$Gross Domestic Product 2013 - Current US$
Rank Economy GDP
Milli
Rank Economy GDP
MilliMillions
US$
Millions
US$
World 75,592,941 7 Brazil 2,245,673
European Union 17,958,073 8 Italy 2,149,485
1 United States 16,768,100 9 Russia 2,096,777
2 China 9 240 270 10 India 1 876 7972 China 9,240,270 10 India 1,876,797
Latin America &
Caribbean
5,657,372 11 Canada 1,826,769
3 Japan 4 919 563 12 Australia 1 560 3723 Japan 4,919,563 12 Australia 1,560,372
4 Germany 3,730,261 13 Spain 1,393,040
5 France 2,806,428 14 South Korea 1,304,554
6 United Kingdom 2,678,455 15 Mexico 1,260,915
The Latin America & Caribbean region is the fourth
Source: World Bank World Development Indicators Dec. 2014
PO 2015 February 22 - 25, 2015
 The Latin America & Caribbean region is the fourth
largest economy

G i M ltil ti i P t h i lGrowing Multilatinas in Petrochemicals
 Alpek – Mexico
– Second largest producer of PET in the Americas, only PP
producer in Mexico
– Recently added the PTA and PET business of Eastman
Chemical to its U.S. operations
– Operates facilities in 20 sites in the U.S., Mexico and Argentina
 Mexichem – Mexico
– Produces vinyl chloride monomer (VCM); PVC in Mexico and
Colombia; compounds in Mexico, Colombia and U.S.; and PVC
pipe throughout region
B k B il Braskem – Brazil
– Leader in the thermoplastic resins segment in the Americas, 8th
largest resin producer in the world, largest petrochemical
company in Latin Americacompany in Latin America
– PE, PP and PVC producer in Brazil, U.S. and Germany
L ti A i t h i l i l b l
PO 2015 February 22 - 25, 2015
 Latin American petrochemical companies are global
competitors

Not Such a Thing as a Latin American
M k t
MEXICO
CENTRAL AMERICA & CARIBBEAN
Market
CENTRAL AMERICA & CARIBBEAN
(Guatemala, El Salvador, Honduras, Nicaragua,
Costa Rica, etc.)
NORTHERN SOUTH AMERICA
(Venezuela, Colombia, Ecuador & Peru)
BRAZIL
SOUTHERN CONE
(Argentina, Chile, Uruguay,
Paraguay & Bolivia)Source: Unisouth
PO 2015 February 22 - 25, 2015
 There are many markets in Latin America

Mercosur and Pacific Alliance Trade Blocs
E i P f F Diff t A hEconomic Performance From Different Approaches
 Mercosur – Argentina, Brazil,
P U d V l Gross Domestic Product –
Paraguay, Uruguay and Venezuela
 Combined purchasing power parity
GDP over US$ 3.4 trillion a year
 Fifth largest economy in the world
Gross Domestic Product –
Latin America and Trade Blocs
[Percent Year on Year Variation]
 Fifth largest economy in the world
 Pacific Alliance – Chile, Colombia,
Mexico and PeruMexico and Peru
 Combined purchasing power parity
GDP over US$ 3.1 trillion a year
 Sixth largest economy in the worldSixth largest economy in the world
 Member nations share several
decades of positive growth, stable
macroeconomic foundations, Source: BBVA Research,
stable governance and openness
to global integration
Many Latin American countries in virtuous circle others
PO 2015 February 22 - 25, 2015
 Many Latin American countries in virtuous circle, others
perceived as more turbulent

U i P l l fi P d tUnique Polyolefin Products
 Consumer Products
– Flexible packaging for fruit export – grapes and papaya – Chile
later Peru
– Bags with colorful stripes – Central America and Andean
countries
– Water bags – Central America and Colombia
 Industrial Products
– Banana bags – Central America, Colombia and Ecuador
– Silo bags – Argentinag g
– Rotomolded water tanks – Initiated in Mexico, now in Argentina
– Large diameter PE-100 pipe – Initially demanded in Chile
– Hot water PP pipe – ArgentinaHot water PP pipe Argentina
– PE flower packaging – Ecuador
While many products are globally uniform many are
PO 2015 February 22 - 25, 2015
 While many products are globally uniform, many are
uniquely local

I d t i l P d t M t i l H dliIndustrial Products – Materials Handling
rnational,,
dadAutónoma
Latin America and most of world
urce:PlastoInte
biernodelaCiud
BuenosAires
ChileLatin America and most of world
Sou
Gob
deB
Chile
Argentina
Local solutions for common problems
PO 2015 February 22 - 25, 2015
 Local solutions for common problems

I d t i l P d t O tdIndustrial Products - Outdoor
desa,
Consultants
Geomembrane for mining - Chile and Peru
urce:BraskemId
stiChemLatAm
g
Sou
Plas
Silo bags - Argentina and exports
Large solutions for critical applications
PO 2015 February 22 - 25, 2015
 Large solutions for critical applications

M i H h ld d CMexico – Household and Consumer
Source: Rotoplas
Source: aba
A liti l d ti i b l t i 150 kt f
PO 2015 February 22 - 25, 2015
 As more political advertising becomes electronic, 150 kt of
plastic will be reduced

D i P d tDairy Products
rnational,
Consultantsl
U.S. Colombia, Ecuador,
Peru Argentina Brazil
Colombia,
Argentina and
urce:PlastoInte
stiChemLatAm
Peru, Argentina, Brazil,
parts of C. America
Argentina and
others
Sou
Plas
Colombia MexicoBrazil
Dairy products are consumed in many different ways
PO 2015 February 22 - 25, 2015
 Dairy products are consumed in many different ways

C P d tConsumer Products
rnationaland
Water - Colombia, parts
of C America
urce:PlastoInte
skemIDESA
of C. America
Sou
Bras
Mexico
Unusual? Colorful?
PO 2015 February 22 - 25, 2015
 Unusual? Colorful?

R t t bl Fl ibl P k iRetortable Flexible Packaging
 A flexible package in which
prepared food is hermetically
sealed for long-term
unrefrigerated storage
mLatAm
 Already big in Asia and
Europe poised to penetrate
U S markets still dominated
urce:PlastiChem
nsultants
U.S. markets still dominated
by metal cans and glass
bottles
Sou
Con
 Booming specially in Central
America, Ecuador and Mexico
El Salvador
Packaging innovations sometimes flow in unexpected
PO 2015 February 22 - 25, 2015
 Packaging innovations sometimes flow in unexpected
ways

F it P k iFruit Packaging
 Sliced papaya in stand upp p y p
pouch
 Provides
mLatAm
Provides
– Excellent gas barrier
– Transparency
urce:PlastiChem
nsultants
– Resealable
Sou
Con
A ready to eat treat!
PO 2015 February 22 - 25, 2015
 A ready to eat treat!

Chil GChilean Grapes
 First quarter of the year in the
U S E t C t
 Well protected, all grains
ld d d li iU.S. East Coast
– Chilean grapes, deliciously
perfect, start showing in the
market
are sold and are delicious
 Result of synergy between
growers plastic processors
 Quality superior to California or
Mexico grapes at end of
northern hemisphere summer
growers, plastic processors,
transportation,
supermarkets and
consumers
northern hemisphere summer
 Each year brings an advance
Initially loose bunches in– Initially loose bunches in
cardboard box
– Later strong, clear, ventilated
PE bags with zipper
– Now carefully printed PP bags
 Chile Peru Colombia and Mexico partnering to sell grapes
PO 2015 February 22 - 25, 2015
 Chile, Peru, Colombia and Mexico partnering to sell grapes
to China year round

YPFB – Bolivia Olefins and Polyolefins
C lComplex
Capacity Start Up Investment
Location
Capacity
[kt/yr]
Product Contractor
Start Up
[year]
Investment
[US$ million]
2 247 t/d LPG
Liquids
separation
plant
Yacuiba,
Tarija, Gran
Chaco
2,247 t/d
1,658 bpd
3,144 t/d
1,044 bpd
LPG
Gasoline
Ethane
Iso-pentane
Técnicas
Reunidas
1H 2015 680
Olefins and
polyolefins
complex
Santa Cruz
~1,000
200
200
Ethylene
LDPE
LLDPE
Tecnimont
(conceptual
engineering)
2022 3,000
complex
350 HDPE
engineering)
Olefins and
polyolefins
Tarija, Gran
Ch
~400 Propylene
Tecnimont
(conceptual 2018 1,800polyolefins
complex
Chaco 350 PP
(conceptual
engineering)
2018 1,800
Ethane available while olefin and polyolefins locations
PO 2015 February 22 - 25, 2015
 Ethane available while olefin and polyolefins locations
still being determined

M i S l d D d PE d PPMexico Supply and Demand – PE and PP
PolypropylenePolyethylene
 Opportunity for additional
capacity
 Time to start planning even
more capacity p y
 C3 expansion under study
more capacity
 Importers will not give up on
this market
 Additional local supply will
The large supply deficit provided an obvious incentive
Additional local supply will
bump demand
PO 2015 February 22 - 25, 2015
 The large supply deficit provided an obvious incentive
for additional PE capacity

Ethylene XXI by Braskem IDESA JV
L di N th A i E i WLeading North American Expansion Wave
 Coatzacoalcos, VC, Mexico
– 1,050 kt/yr cracker – Technip
– 400 kt/yr HDPE – Ineos
Innovene S
– 350 kt/yr HDPE – Ineos
Innovene S
– 300 kt/yr LDPE/EVA –
urce:Braskem
Lyondell Basell Lupotech T
 ~ US$ 4.5 billion investment
Sou
 Pre marketing portfolio of 320
clients
Construction reached 88% completion by end of 2014
PO 2015 February 22 - 25, 2015
 Construction reached 88% completion by end of 2014,
commissioning planned by end of 2015

S f PE d PP S lSources of PE and PP Supply
 A highly dynamic situation but in general sources areg y y g
– Mexico: U.S.
– Central America & Caribbean: U.S., Korea
– South America (Pacific Coast): U.S., Korea, Argentina,
Brazil
– Southern Mercosur: Argentina, Brazil, Korea, China,
Middle East
PO 2015 February 22 - 25, 2015
 Geography and logistics matter

Lik l F t S liLikely Future Suppliers
 Still a highly dynamic situation, but importers for each areag y y p
will be
– México: U SMéxico: U.S.
– Central America and Caribbean: Mexico and U.S.
– South America Pacific Coast: U.S., Argentina, Brasil, later
Per and Boli iaPeru and Bolivia
– Southern Mercosur: Argentina, Brasil and later Bolivia
 Imports from East Asia will be displaced by U.S. imports
 Local producers will have regional competitors
PO 2015 February 22 - 25, 2015
 Geography and logistics still matter

S P d E d U NSome Processor and End User News
 Borealis Brasil – Expands PP compounding – € 45 million
 Brazil's Cutrale and Safra acquire Chiquita Brands – US$ 1.3
billion
 MAUSER and SAI launch Intermediate Bulk Container venture
in Monterrey, Mexico
 Cardia Bioplastics sets up film and bag production in Sao
Paulo
 Tetra Pak completes € 65 million upgrade in Ponta Grossa,
B ilBrazil
 EBIH building HDPE pipe, fittings, agricultural film and
geomembranes facility in El Alto, Bolivia
 ADS and Tigre double HDPE pipe capacity in Maceio, Brazil
P i it d ti i t dil
PO 2015 February 22 - 25, 2015
 Processing capacity and consumption growing steadily

O t itiOpportunities
 Critical elements for success
T ki d t f th ti f t– Taking advantage of the connecting factors
• Languages
• Trade agreements
• LogisticsLogistics
– Tailoring products – resins and processed products
• Local traditions
• Local circumstances
L l li ti• Local applications
 Recognize that business practices are not uniform
– Even within a country!Even within a country!
 Acknowledgements
– Information and many photos from Braskem IDESA, Grupoy p p
Texne, Mondelez, PlastiChem LatAm Consultants, Plasto
International, Unisouth and IPA Polyolefins course students
M b i t iti th h t th l h i
PO 2015 February 22 - 25, 2015
 Many business opportunities throughout the value chain

PO 2015 February 22 - 25, 2015

C t t
Petro
Chemical
Consulting
Contact
g
Alliance
Jorge O. Bühler Vidal
22 Hidden Lake Dr.
No Brunswick NJ 08902No. Brunswick, NJ 08902
U.S.A.
Telephone: 1 (732) 951 8710Telephone: 1 (732) 951-8710
e-mail: buhlerjo@polyolefinsconsulting.com
PO 2015 February 22 - 25, 2015

The Five Regions of Latin America

Recommended

Recommended

More Related Content

What's hot

What's hot (16)

Similar to The Five Regions of Latin America

Similar to The Five Regions of Latin America (20)

More from Jorge Bühler-Vidal

More from Jorge Bühler-Vidal (7)

Recently uploaded

Recently uploaded (20)

The Five Regions of Latin America