02 February 2012 20:17 [Source: ICIS news]
HOUSTON (ICIS)--The Brazilian chemical industry has not capitalised on the nation's economic growth opportunities and it is losing competitiveness in an accelerated fashion, Brazilian chemical industry association, Abiquim, said on Thursday.
In its January report, Abiquim said apparent consumption of chemical products for industrial use grew by 9.68% in 2011 compared with the previous year, but there was a 3.83% decline in production, and a 4% reduction in domestic sales compared with 2010 figures.
Internal demand growth was fulfilled by imports, which grew by nearly 25% compared with 2010. Abiquim attributed the import growth to the high cost of domestic raw materials relative to the competition from international markets.
Prices recovered during 2011, growing by nearly 15% compared with 2010 figures. However, the utilisation of installed capacity was only 80% of the 2010 average.
The decline in production during the last quarter of 2011, recorded at 4.02%, was seasonally expected because the chemical industry uses the low sales season for maintenance stops.
Imports also increased because of the valorisation of the Brazilian real versus the dollar, Abiquim noted.
The international economic crisis has resulted in excess inventories of chemical products around the world, and for this reason, the association believes the flow of products into the Brazilian market will continue.
The Brazilian chemical industry lacks short-term plans to stimulate existing plants in order to elevate capacity utilisation, as well as long-term plans to attract new investment, Abiquim concluded.
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