Global chemicals output could fall 6% in '09 - OEF

24 February 2009 16:14  [Source: ICIS news]

LONDON (ICIS news)--Global chemicals output could fall 6% this year with output from the EU, the US and Japan down by 8.25% and that from emerging markets flat, UK-based Oxford Economic Forecasting (OEF) said on Tuesday.

Chemicals output from the triad regions of the EU, US and Japan could fall by 12.5% if pharmaceuticals are excluded, it added.

Total chemicals output by China may grow a little over 4% but Eastern Europe could fall by 12%, the consultancy said in a note to clients.

The national pattern in the triad in 2009 is likely to be similar to the end of 2008 with total German chemicals output down 10%.

Chemicals output fell more sharply that expected in the fourth quarter of 2009 with end use demand collapsing and customers de-stocking. Quarterly total chemicals output from the triad was down 6.1% and that from emerging markets down 4.3% quarter on quarter.

Countries heavily dependant on basic chemicals such as Germany and the Netherlands registered double digit falls, while those with a strong pharmaceutical base such as Sweden and the UK fell by far less. Soaps and detergents suffered less than most sectors with a fall of 2%, OEF said.

“Within the triad pharmaceutical output may be 1% down this year while basic chemicals and man-made fibres will see the worst of the fall dropping by over 16%. Soaps and detergents will be protected from any major downturn but paints and other chemicals must await recovery in motors and construction before they improve significantly,” it added.

“In our view there still remains considerable downside to these numbers in the next couple of quarters with a significant probability then of a stronger recovery beyond that,” OEF consultant, Davis Thomas said.

 

 

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By: Nigel Davis
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