 |
 |
Chemicals & Materials Industry Outlook
+ Case studies of Spire's work in Chemicals & Materials
As chemicals and materials are widely used across verticals, the industry is generally vulnerable to broad GDP fluctuations. When the economy slows to a crawl, manufacturing often takes the brunt and plant shutdowns, layoffs and other cost-cutting initiatives tend to follow, resulting in a slowdown in demand for the chemicals that go into all kinds of products. In particular, the volatility of crude oil prices since 2008 have brought the petrochemicals industry on a roller-coaster ride.
However relief will come in the form fiscal stimulus measures that boost construction, a major customer segment for chemicals and materials. State-led construction in China, for instance, has already boosted the country’s consumption of steel and iron ore since late 2008.
While oil remains an important fuel in Asia, where several refineries and unexplored oil fields are located, governments are mandating and supporting the use of bio-fuels as well as other forms of alternative energy. Demand is likely to soar in the medium-term. Malaysia, Indonesia and several countries in South America are major producers of bio-fuel feedstock such as palm oil, jatropha and sugar cane, and will continue to see investment in these areas. Government support towards solar energy R&D and manufacturing is particularly evident in China and Hong Kong, a development that will create opportunities for chemicals suppliers.
Despite the current downturn, the nature of the chemicals and materials industry requires capital-intensive investments and long lead-times between ground-breaking and peak production. Hence the progress of new and existing investments is unlikely to see substantial cuts. Asia will remain an attractive location due to low operational costs and healthy demand.
In today's challenging environment, chemicals and materials manufacturers need to stay focused on the countries and segments where long-term demand is healthy, while ensuring that they remain sufficiently engaged with customers to be able to benefit from the eventual recovery.
Spire’s chemicals & materials expertise
Spire’s work in the chemicals and materials space has addressed subjects ranging from sales and marketing problems to competitor benchmarking and threat response. We are well-versed in products ranging from industrial gases, organo-silanes, melamine and palm oil, through building materials such as cement and structural wood, to PE and PP used for a variety of applications.
Case Studies:
To request more information on our research and consulting services in the chemicals and materials industry, please contact either our country offices or email info@spireresearch.com.
| |
|