Brazilian Adirplast expects coronavirus pandemic to intensify plastics demand

Brazil's largest petrochemical distributor association, Adirplast, expects the coronavirus pandemic to intensify the demand in the plastics chain in Brazil, it said Monday.

According to Adirplast, the coronavirus pandemic has already increased the demand for disposable products by 20%, mainly in the medical and pharmaceutical fields, it said in a statement.

"To ensure that there is no shortage of products in hospitals ..., our customers, especially the largest ones, have been working even harder. For 70% of them, which work in the packaging area, hospital products, cleaning and hygiene or pharmaceutical segments, the demand has even grown by up to 20% in the last few days," said Adirplast President Laercio Goncalves.

According to Goncalves, Brazil has not reached its most critical phase of the crisis, and it is hard to predict how the market will behave. "This is a problem that should be extended for at least another 60 days, at least. Therefore, we are working to prevent productivity from falling sharply, as in China, where it fell by two-thirds," Goncalves said.

According to Adirplast, after the coronavirus pandemic is over, the expectation is for the plastics sector to see a potential growth as the outcome.

The association also said domestically the petrochemical sector is facing challenges. "The lack of raw materials, coupled with other problems such as the rise of the US dollar [compared to the Brazilian real], the fall in the price of the oil and the industry's own performance, can certainly promote not only a greater oscillation in resin prices, but the instability of the business itself," Goncalves said.

In 2019, Adirplast associates sold 239,107 mt of polyethylene in the Brazilian market, up 7.8% year on year and 8.4% from 2017. Polyethylene sales were similar on the year at 99,386 mt, but up 5.5% from 2017. Polystyrene shipments were up 9.1% from 2018 to 56,037 mt, and was also up 18.2% from 2017.

Adirplast is the largest association of resin distributors in Brazil. Adirplast represents around 40% of the distribution market in Brazil.