Specialty-chem focus to help Europe chems fight higher costs - S&P

23 April 2013 16:38  [Source: ICIS news]

HOUSTON (ICIS)--Several European chemical companies can withstand the feedstock advantage of their US competitors because of their geographic diversity and their orientation towards specialty chemicals, Standard & Poor's (S&P) Ratings Services said on Tuesday.

"Despite the challenges that European chemical manufacturers face," said S&P credit analyst Paulina Grabowiec, "we have stable outlooks on most of them, indicating our belief that many will undertake profit improvement measures."

Nonetheless, European producers will likely remain at a cost disadvantage versus their peers in North America, who are benefitting from low-cost feedstock made available by the advent of shale gas, S&P said.

In all likelihood, North American producers will continue to benefit from low-cost natural-gas liquids (NGLs), S&P said.

As a result, North American companies can withstand any future downturn in the chemical industry, according to a statement by S&P credit analyst Cynthia Werneth.

Werneth comments come as S&P released its report, "Low-Cost Shale Gas Gives North American Petrochemical Producers Advantages Over Europe".

By: Al Greenwood
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