US Momentive Specialty Chemicals seeing volume growth in Q1 – CEO

02 March 2012 16:49  [Source: ICIS news]

HOUSTON (ICIS)--Momentive Specialty Chemicals is seeing sequential sales and volume increases in the first quarter compared with the fourth quarter of 2011, the US-based specialty chemicals firm said on Friday.

CEO Craig Morrison said that volumes in many of Momentive’s businesses are rebounding in the first quarter, driven by renewed growth, rather than just restocking after a weak fourth quarter.

“You can probably assume that 10 to 15% of [the volume rebound] is due to restocking, the rest of it is renewed growth,” Morrison told analysts during Momentive’s 2011 fourth quarter results conference call.

“I would say, overall we are getting a more optimistic tone in the market place than in the fourth quarter,” Morrison said. “There was a high degree of uncertainty in the fourth quarter, and that seems to be changing in the first quarter.”

Momentive sees a mixed picture in terms of European volumes, Morrison added.

Germany and the Netherlands – both of which Morrison visited this week – were holding up rather well, despite the eurozone crisis, he said.

Poland and other eastern European countries were also doing well but southern Europe and the UK continued to struggle, Morrison added.

Meanwhile, growth rates in China seemed to be slower than in the second half of 2011.

“We thought we were starting to see a little relief [in China] but it really seems to have abated,” he said.

Overall, Momentive expects continued growth in 2012: “A modest recovery, not overly ambitious,” Morrison added.

He added that given short lead-times in the industry, it is difficult for Momentive and others to forecast trends beyond 60 days.

Following the 2008-2009 global economic and financial crisis, industrial producers have become much more adept at managing inventories, which means “things react much faster than they used to five years ago, or 10 years ago,” Morrison said.

“Looking out 60 days, we have a fairly good visibility of what’s going on in the market… but after that you are really having a rather subjective look at market dynamics, market economics etc,” he added.

Paul Hodges studies key influences shaping the chemical industry in his Chemicals and the Economy Blog

By: Stefan Baumgarten
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