Ukraine Petrochemicals Report Q4 2011
Business Monitor International, September 2011, Pages: 46
Business Monitor International's (BMI) Ukraine Petrochemicals Report (Q4 2011) provides industry professionals and strategists, corporate analysts, petrochemical associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Ukraine's petrochemicals industry.
The Ukrainian petrochemicals industry is enjoying a strong export-led recovery, but this remains precarious and subject to high levels of external risk, according to BMI’s latest Ukraine Petrochemicals Report.
In H111, chemical and petrochemical output grew 18.3% y-o-y with basic chemicals up 38.3%, rubber products down 5.3% and plastic products up 7.1%. Performance declined through Q211, particularly in June, as base effects wore off. On a y-o-y basis, primary plastics output in H111 was up 75.1% to 234,800 tonnes with monthly output in June up 155% y-o-y and at the highest level since March 2008. Output was boosted by the start of production at Karpatneftekhim’s new PVC complex at the beginning of the month. The 300,000 tonnes per annum (tpa) suspension vinyl facility in Kalush was expected to be completed in 2009, but has suffered from continuous delays due to the poor performance of the Russian PVC market. The resumption of growth in Russian construction activity in 2011 should support Ukrainian PVC exports and output going forward.
The positive figures mark a stronger-than-expected turnaround in downstream segments, in line with better growth figures prompted by rising exports and investment as well as a significantly stronger than expected recovery in household consumption. Exports rose by 48.7% y-o-y in Q111. BMI’s continues to see robust export performance through to the end of 2011, which will underpin the recovery. BMI expects the export of goods to rise by 18.0% in 2011, slowing from the stellar Q111 rate as positive base effects fade.
According to the Ukrainian State Statistics Committee (Ukrstat), Ukraine boasted real GDP growth of 5.2% y-o-y in Q111 compared to 3.3% in Q410. BMI has revised its estimate upwards from 3.6% to 4.4%, to reflect this trend. In turn, BMI forecasts plastic output of 490,000 tonnes in 2011, an increase of 44% y-o-y, helped in large part by the pull of export growth in plastic-consuming industries. The export-oriented nature of growth in petrochemicals means that the industry is highly exposed to external risks. A significant deterioration in the demand for Ukraine's major export products would pose a major setback for the industry. In addition, BMI highlights that the relative competitiveness enjoyed by Ukrainian petrochemicals exporters will be eroded by rising domestic gas prices as government subsidies are withdrawn under Kiev's International Monetary Fund (IMF) Stand-By Arrangement (SBA) as well as the rise in oil prices, which will spur the growth in naphtha feedstock.
Ukraine remains in joint 8th place – with Bulgaria – in BMI’s Central and Eastern Europe Petrochemicals Business Environment matrix with a score of 40.0 points. This puts Ukraine 6.2 points behind Romania and Slovakia and 6.7 points ahead of Azerbaijan.
Executive Summary
SWOT Analysis
Ukraine Petrochemicals Industry SWOT
Ukraine Political SWOT
Ukraine Economic SWOT
Ukraine Business Environment SWOT
Global Petrochemicals Overview
Table: World Ethylene Production By Country, 2010 And 2015 (‘000 tonnes capacity)
Financial Results
Global Oil Products Price Outlook
Table: Oil Product Price Assumptions, 2011 (US$/BBL)
Table: Oil Product Price Forecasts, 2011-2015 (US$/BBL)
European Petrochemicals Overview
Ukraine Market Overview
Market Structure
Table: Ukraine’s Petrochemicals Sector - Cracker Capacity, 2008-2015 (‘000tpa)
Industry Trends and Developments
Upstream
Business Environment
Petrochemicals Business Environment Ratings
Table: Central And Eastern Europe Petrochemicals Business Environment Ratings
Industry Forecast Scenario
Petrochemicals Outlook
Table: Ukraine’s Petrochemicals Sector, 2007-2015 (‘000tpa, unless otherwise stated)
Macroeconomic Outlook
Ukraine - Economic Activity
Company Monitor
KarpatNaftoKhim
Stirol
TNK-BP
Glossary of Terms
Table: Glossary Of Petrochemicals Terms
BMI Methodology
How We Generate Our Industry Forecasts
Chemicals And Petrochemicals Industry
Cross Checks
Business Environment Ratings
Table: Petrochemicals Business Environment Indicators And Rationale
Weighting
Table: Weighting Of Indicators
- KarpatNaftoKhim
- Stirol
- TNK-BP
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