APIC ’12: Reconstruction boosts Japan demand; crisis not over yet

18 May 2012 04:10  [Source: ICIS news]

KUALA LUMPUR (ICIS)--Reconstruction works in Japan improved the country’s demand, but it will take a while before demand goes back to levels seen before the natural disasters struck in March 2011, a Japanese supplier said on Friday.

“People are buying materials for the reconstruction of damaged areas, but consumer confidence and household spending is very low and it will be a while before people are buying at pre-earthquake levels,” the supplier said on the sidelines of the 34th annual Asia Petrochemical Industry Conference (APIC) in Kuala Lumpur.

The supplier said that with production now at normal levels, his company is working hard to export material to the US and South America, as the Japanese buyers are not consuming enough.

“Exports are expected to increase as an adjustment of the overvalued Japanese yen takes place and the world economy gradually improves,” Kyohei Takahashi, chairman of the Japan Petrochemical Industry Association said in a speech at APIC.

However, the industry should be aware that there are a number of uncertainties remaining which pose risk to economic growth, Takahashi said.

“The earthquake and tsunami in Japan and the flood in Thailand significantly affected the world supply chain and gave our industry violent reminders that the world is so integrated in the economic and industrial sense that a disruption in one piece of the supply chain can cause a systemic halt to all activities around the world,” Takahashi said.

“It is important for us to prepare for the unexpected.”

The earthquake and tsunami that wrought havoc in Japan in March 2011 also devastated the commerce that flows in and out of the country. Supply chains were cut and companies all over the world scrambled to find replacement materials and parts.

Takahashi said that companies must develop business continuity plans for alternative means of supply and logistics.

APIC runs from 17-18 May.

Author: Heather Doyle

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