Planning for Uncertainty

Question mark.pngThe blog’s New Year Outlook has just been published in ICIS Chemical Business. Please click here if you would like to download a copy

It suggests that 2010 turned out to be a better year than many in the industry had expected. But even so, global operating rates (OR%), at 86%, remain well below those considered normal over the past 20 years.

So the key question is: What happens next?

Will the recovery continue, and OR% return to more normal levels, perhaps even to another ‘super-cycle’?
Will they simply stabilise at today’s levels?
Or will a slowing Chinese economy, plus the switch from stimulus to austerity measures by many governments (particularly in Europe), lead to a further fall as demand growth slows?

Equally, it is becoming clear that we are heading towards a New Normal in terms of global demand patterns.

So the article suggests that Scenario Planning is becoming essential, as we seek to position our businesses for an increasingly uncertain future.

About Paul Hodges

Paul Hodges is Chairman of International eChem, trusted commercial advisers to the global chemical industry. Paul is also an invited member of the World Economic Forum’s Global Agenda Council. The aim of this blog is to share ideas about the influences that may shape the chemical industry over the next 12 – 18 months. It will try to look behind today’s headlines, to understand what may happen next in important issues such as oil prices, economic growth and the environment. We may also have some fun, investigating a few of the more offbeat events that take place from time to time. Please do join me and share your thoughts. Between us, we will hopefully develop useful insights into the key factors that will drive the industry's future performance.

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