RIL's crackers at Hazira, Nagothane, Dahej and Vadodara
are among the world's most integrated petrochemical
complexes with upstream refining, E&P and downstream
chemical facilities. RIL is a leading producer of LAB,
benzene and butadiene in India. RIL also produces basic
aromatic building blocks of the highest purity, conforming
to the product grades. These include toluene, mixed-xylene
The global chemical industry has undergone a
transformation since major financial crisis of 2008. The
chemical industry benefitted from industry discipline and
rapid economic recovery, especially in China and India.
Despite unplanned outages, the industry demonstrated a
slow and consistent improvement in production volumes.
The overall margins improved as increase in raw materials
could be passed on to the end-user even as operating
rates remained stable.
An excessive demand pull from the automotive sector
coupled with high natural rubber prices created high margin
environment in the elastomer segment. Shortage of cotton
created superior performance in acrylic fibres and provided
support to acrylonitrile.
Benzene : The global capacity of benzene in 2010 was 56
MMT against production of 40 MMT, resulting in average
operating rate of 72%. Demand for the year was 39.8 MMT.
Globally, capacity has increased by more than 7.5 MMT
in the past 4-5 years resulting in excess capacity.
Butadiene : North-East Asia remains the world's largest
market with a global market share of 44%, followed by
22%, and 21% by USA and Europe respectively. The
demand grew at 10% on a year-on-year basis.
Polybutadiene Rubber (PBR) is the second largest
synthetic rubber among elastomers and its demand is
estimated at 2.7 MMT. Global demand for synthetic rubber
in coming years is expected to grow at 4.8% annually.
Caustic Soda (CS) : The installed capacity of caustic soda
is 85 MMT globally. The global consumption of caustic
soda increased to 63 MMT in FY-11, an increase of about
6% over FY-10 and operating rate of 74%. Around 55% of
the global chlor alkali capacity is now in Asia.
Linear Alkyl Benzene (LAB) : Globally, the consumption
of LAB is pegged close to 3 MMTPA against capacity of
3.6 MMTPA. The consumption growth is at 2.5% per
annum and is expected to continue at this rate driven by
Asian demand. With an installed capacity of 182 KT,
Reliance is the world's fifth largest producer of LAB.
Acrylonitrile : The global capacity of acrylonitrile in 2010
was 5.7 MMT against production of 5.1 MMT, resulting
in average operating rate of 90%. The demand for the year
was 5.08 MMT.
Indian chemical scenario
The Indian chemical industry environment was in line with
the global business environment with the exception of
the elastomer segment due to the excessive demand from
the automobile segment. RIL has leadership position in
aromatic segment constituting benzene, toluene and
The demand from downstream sectors covering SBS
rubber, PBR, ABS and styrene butadiene latex recovered
during the year and total demand is pegged at 117 KT.
Domestic demand for PBR is met by RIL besides imports
with consumption estimated at 135 KT. The market
estimates demand for PBR to reach 155 KT by 2013 (a
growth of 5% CAGR).
RIL is the sole producer of acrylonitrile in India with a
capacity of 41 KTA. RIL's production in entirety is sold in
the domestic market and represents nearly 30% share with
the rest being imported.
For the year 2010-11, RIL's benzene production was at 700 KT, a
growth of 4% on a year-on-year basis. Total sales for the
year were 681 KT, out of which 381 KT was exports, 215
KT was domestic and 85 KT was for captive consumption.
Exports of benzene during FY-11 were at 381 KT mainly to
the US, Europe, besides Middle East. Toluene, a major biproduct
of BTX group, registered production volumes of
RIL produced 174 KT of butadiene during the year of
which 61 KT was exported after meeting the entire domestic
requirement and captive consumption.
RIL is the only manufacturer of PBR in India. During the
year, it produced 76 KT, an increase of 4.7 % on a year-onyear
basis, most of which was sold in the domestic market.
RIL has the annual capacity to produce 168 KTA of caustic
soda and 141 KT of chlorine. RIL's capacity utilization for the year was at 97% as against average domestic capacity
utilization of 75%.
RIL produces 163 KT of LAB on an annualized basis.
Tightness of normal paraffins resulted in lower utilization
of LAB capacity.
RIL's entire production of acrylonitrile was sold in the
domestic market. The upswing in demand from derivatives
and restricted global supplies supported prices and