1.2.2 Petrochemical Capacity 1.2 Petrochemical business unit 1.2.1 Petrochemical Market Overview Petrochemical market situation in 2023: The demand for petrochemical products continued to be sluggish being affected by several factors. These included the protracted conflict between Russia-Ukraine, along with significant global economic slowdown due to persistent high inflation leading to continuous interest rate hikes by central banks worldwide. China’s economy was obviously seen not recovered as anticipated following intensification of the property crisis. Even though Chinese government issued various economic stimulus measures, the demand remained unrecovered due to lack of purchasing confidence resulting in more cautious spending, especially those in durable goods sector that led to slowdowns in production and export. Nevertheless, with travel restriction eases by several countries, tourism industry continued to recover boosting demand in certain industries such as food packaging as well as health and medical equipment. On the supply side, there was a pressure from new production capacity, especially those in China, Vietnam, and Indonesia entailing excess supply in the region and pulling plastic pellet prices down. Consequently, some producers decided to reduce their utilization to maintain profit margins and market equilibrium. Petrochemical 2023 2022 %Change Utilization Rate Olefins Group 73% 86% (13%) Aromatics and Styrenics Group 74% 86% (12%) In 2023, the utilization rate of Olefins group was 73% declining by 13% from that in 2022 of 86%. In addition, the utilization rate of Aromatics and Styrenics group was 74% being down by 12% from that last year due to production adjustment aligning with market conditions. 1.2.3 Petrochemical Sales Products Sales Volume (KMT) Sales Value (MB) 2023 2022 2023 2022 Olefins Group 864 1,001 31,228 42,448 Aromatics and Styrenics Group 572 600 22,148 27,954 Total 1,436 1,601 53,376 70,402 Net sales of petrochemical businesses in 2023 was down by 24% from that last year as sales volume decreased by 10% and average selling prices decreased by 14%. Remark: Included sales of Trading business (iPolymer) and New S-Curve business (Rakpasak) 176 Management Discussion and Analysis (MD&A) IRPC Public Company Limited
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