Houston, TX, December 12, 2009 --(PR.com
)-- The global petrochemical industry made rapid adjustments to uncertain market conditions throughout 2009. Some capacity closures and record low operating rates were evidence of not only the global recession but the terraforming of the industry. China will make significant progress toward supplying its own continuing, rapid growth; while the Middle Eastern region will expand its role as the incremental petrochemical supplier to the world.
Oil prices and the uneven return to growth in global markets will provide challenges to the petrochemical industry in 2010. The biggest hurdle for petrochemicals will be the growth in capacity which is sure to continue the regional rationalization in the industry. The need for action will be eased by the return to strong demand in Asia which should outpace new supply, at least in the first half of the year.
· A global recession cut nearly 19 million tons of polyethylene from the market
· Global output went from 5.2% in 2007 to -1.1% in 2009
· US housing starts were cut in half
· Several million tons of new capacity was delayed throughout the year until the fourth quarter
· The industry dealt with the recession and corresponding glut of new Middle Eastern capacity by closing some plants, mainly in the US, and maintaining operating rates around 70% for months
· China began to recover quickly pulling US production higher with exports of 25-30% of capacity
· Regional supply will be terraformed by three years of new capacity in the low cost Middle East
· Asian, particularly Chinese demand will likely continue to be so strong that US exports may continue through the first half of the year
· Demand in Asia may take some downward price pressure off of European producers, putting off closures until the end of 2010
· Prices look as if they will remain steady and producers generally profitable, as long as oil prices maintain their forecasted slow climb
The complementary, detailed, twelve page review and forecast are available on the Kevin L. Boyle, Consulting website at klbconsultingservices.com.
Contact Kevin Boyle at email@example.com or go to www.klbconsultingservices.com for further details.
About Kevin L Boyle, Consulting – Since 2003, Kevin L. Boyle has provided industry expertise and quantitative support in petrochemicals, NGL’s and refining to financial services professionals, industry participants and litigation. He publishes MarketWorks, a weekly newsletter for petrochemicals and NGL’s and other quantitative products.