Europe building block chemicals future confidence rises in June – CMCI

LONDON (ICIS)–European building block petrochemical players have become sharply more confident on improving future business conditions, order book volumes and profitability compared with May, analysis of the June ICIS Europe Chemical Markets Confidence Index (CMCI) showed on Wednesday.

Nevertheless, confidence in current business conditions, order book volumes and profitability compared with 12 months ago has markedly decreased since May.

The decrease in current indicators may be a reflection of recent volatility in crude oil and the difficulty with managing changing costs further down the chain.

Simultaneously, the improvement in future expectations may be linked to greater financial stability in June and a decrease in crude oil volatility boosting confidence.

It is unclear what role the so-called Brexit vote played in expectations of current conditions compared with 12  months ago, as the index was collated in the week preceding and in the immediate aftermath of the vote.

Although it is likely that it played a role for some players in their views in confidence at the end of the week, it is too early to see the full manifestation of the impact.

The newly established ICIS Europe CMCI aggregates sentiment from hundreds of petrochemical market players actively involved in price negotiations across more than 60 different markets.

The Europe CMCI runs from +100, to -100, with zero on each index representing neutral, or uncertain conditions, a negative score indicating bearish expectations and a positive score representing bullish expectations. The indexes also gather sentiment on the comparison between the current situation and the situation across the past 12 months to give a complete picture of current market conditions and confidence. The information is gathered in the third week of each month.  A full methodology is available on request.

For more details on the overall Europe CMCI data, click here