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Netherlands Petrochemicals Report 2012
Business Monitor International, Dec 2011, Pages: 41
The Dutch petrochemicals industry has been excellently placed to take advantage of inventory restocking and uplift in overall demand, and has benefitted from its advanced and diversified product portfolio. BMI’s latest Netherlands Petrochemicals Report expects the industry’s strengths to see it through the downturn.
With polymer demand linked to GDP growth, the expected loss of economic momentum in coming quarters will dampen the industry’s performance as export growth continues to slow and consumer confidence remains fragile. While we do not expect the economic recovery to be derailed, the PVC segment will remain under pressure due to the continued lacklustre performance of the residential housing sector. Meanwhile, PP will come under pressure from the expected slump in car making. Private consumption is expected to be constrained by weak employment conditions, leading to a stagnation in demand for consumer-oriented plastics, particularly in the PE segment. This is particularly the case given that fiscal austerity measures will start to take effect in the coming quarters. Additionally, export demand from outside the eurozone will be challenged by the weak US economy and China's monetary tightening efforts. Demand from the US is of particular concern with economic recovery is significantly weaker than had previously been anticipated.
On the upside, the Dutch petrochemicals industry will continue to play on its high level of integration and competitiveness, particularly in high-value finished products, in order to secure its share of eurozone markets. The Dutch petrochemicals industry continues to attract investment with Teijin opening its first high-performance polyethylene (HPPE) production facility at Emmen in October 2011, marking the Netherlands’ continued diversification of downstream products. Meanwhile, Thailand’s Indorama Ventures is planning to increase PTA capacity at the company's Rotterdam plant by 250,000tpa to 600,000tpa with completion in 2014 thereby serving as a major feedstock supplier to PET producers in Western Europe.
With 72.4 points, the Netherlands is in second place out of six countries assessed in BMI’s West European Petrochemicals Business Environment Ratings. A recovery in country risk ratings, even in the face of economic headwinds in H211, led to a 0.6 point rise in its score and increasing its position in the rankings from third place last year. It is now 7.4 points behind Germany and 0.7 points ahead of France. The Netherlands scores close to the regional average in petrochemicals-related scores and its risk ratings have now risen above the regional average, marking it out as a prime investment destination.
Business Monitor International's Netherlands Petrochemicals Report provides industry professionals and strategists, corporate analysts, petrochemical associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Netherlands's petrochemicals industry.
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