Saudi petchem sector to see solid performance in 2022: Tasnee CEO

Mutlaq Al-Morished, CEO of Tasnee

Mutlaq Al-Morished, Chief Executive Officer (CEO) of National Industrialization Co. (Tasnee), expects the Saudi petrochemicals sector to demonstrate solid performance in 2022.

Prices of ethylene and polypropylene will range between $1,450-1,500 per ton in 2022-23, Al-Morished told Asharq TV, adding this is an excellent price for consumers and producers.

All petrochemical producers reported robust profit in the first nine months of 2021, amid global economic recovery. However, with higher feedstock prices, profit witnessed a simple correction on exceptional prices in the second half of 2021.

Feedstock prices in Saudi Arabia are still very competitive, Al-Morished affirmed, noting that sometimes feedstock costs in the US are cheaper compared to the Kingdom.

Expansion in the petrochemical sector depends on the availability of feedstock. The existing supply in Saudi Arabia and the GCC is only sufficient for ongoing projects, but might not be enough for future expansions. Therefore, some local companies started to tap other countries to enhance their presence there, he concluded.

Tadawul-listed petrochemical producers reported a combined net profit of SAR 31.8 billion in the first nine months of 2021, against a net loss of SAR 5.73 billion a year earlier.

Tansee posted a net profit of SAR 1.017 billion for the nine-month period, versus a net loss of SAR 274.3 million in the year-ago period.