24 January 2013 11:16 [Source: ICIS news]
LONDON (ICIS)--European chemicals production volumes expanded in November 2012, the first month that levels have increased year on year since July 2011, US-headquartered analyst Bernstein Research said on Thursday.
Production volumes grew by 0.3% in the region during November compared with October 2012, and by 1% compared with November 2011. Meanwhile, US chemical production volumes continued to rally in December, expanding by 0.2% month on month and 7% year on year, according to the firm.
Despite the fillip in production levels for the EU, the sector is still struggling to cope with strong economic headwinds as a result of the region’s sluggish recovery.
“Leading indicators... suggest manufacturing is stable, but the eurozone remains weak,” said Bernstein.
“Inventory reduction in the US and Europe has likely weakened Q4 volumes, but rebuilding could boost growth in 2013,” the company added.
General manufacturing volumes continued to decline in Europe during December the company said, citing purchasing managers index (PMI) data, but the US and China sectors expanded slightly during the period.
The growth in EU chemicals production leaves Bernstein “more confident” about German chemicals giant BASF, while the market for crop protection chemicals is deteriorating, and the market trend for the paintings and coatings sector is negative, the company added.
“We are still comfortable with the slight decline we estimate for volumes in 2012, but we will be watching the volume development closely,” the company said, commenting on prospects for the European paints and coatings market .
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