Shell Chems sees 'difficult conditions' for next 18 mos

24 March 2000 18:19  [Source: ICIS news]

LONDON (CNI)--Shell Chemicals said Friday it expected "difficult conditions" to continue in markets for the next 18 months, pending oil price developments and feedstock cost trends.

James Smith, vice president for technology, portfolio and sustainable development, said he expects a "reasonable" first half this year but that for "another year and a half or so, we're going to see some more difficult conditions".

As margins are squeezed, producers are starting to raise product prices, where possible. Evert Henkes, chief executive, said it has been difficult to pass on higher olefins cost increases.

Henkes expects the Shell Chemicals portfolio - divested of some downstream assets - to average 6% growth annually in sales revenues over the next 5-6 years.

Fran Keeth, vice president for finance and business systems, confirmed that the group's cost cut target for 2001 is $550m, up from the initial target of $350m. However, the increase is due primarily to an expanded definition of fixed costs.

On Shell Chemicals' divestment programme, Henkes said he expects soon to make announcements on the status of the final disposals - Kraton elastomers, and, in one block, bisphenol A, epichlorohydrin (ECH), epoxy resins and Versatic monocarboxylic acids.

"By the end of next year," said Henkes, "I believe we will be able to characterise ourselves as a world class performer."

By: Patrick Reynolds
+44 208 652 3214

< previous article(VIDEO – ICIS news Americas Lunchtime Bulletin 2 November 2009)

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly