08 March 2013 09:26 [Source: ICB]
European engineering plastics demand is sharply fragmented depending on end-use sector, sources said.
Sources in the nylon (or polyamide), polyacetal (POM) and polybutylene terephthalate (PBT) markets said demand in February month was between 15% below and 15% above year-ago, depending on end-use market.
Demand from the small- and mid-sized automotive and fibre industries is weak - with sources estimating consumption in February at up to 15% below February 2012 levels - as poor general economic conditions have reduced consumer purchasing power.
Sources connected to the premium automotive sector, however, have seen demand rise by up to 10% in February year on year. This has been attributed to a growth in exports to Asia, where upward social mobility is increasing demand for luxury car brands.
There are some concerns the strengthening euro against the US dollar could weaken exports of finished goods in the short term, but most sources expect upward social mobility to shield the premium automotive market from the demand downturn in other industries.
Consumption from the electrical sector is also strong, with sources estimating February demand at 15% above February 2012 levels. This has been attributed to a growth in PBT use in the sector.
Demand from southern Europe is weaker than in northern Europe. This is because southern Europe has been more heavily affected by the eurozone debt crisis, and northern Europe has stronger ties to the premium automotive industry.
A producer of PBT feedstock butanediol (BDO) said demand from the northern part of Europe was robust in comparison to southern Europe, particularly from the car manufacturing industry in Germany, which exports to Asia.
The source predicted a strong BDO market in the second quarter, on seasonally high demand.
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