Netherlands Petrochemicals Report 2011
BMI anticipates Dutch petrochemicals volumes levelling out in 2011 as the industry has made up for most of the declines witnessed during the economic crisis, according to BMI’s latest Netherlands Petrochemicals Report.
The Dutch chemical industry saw turnover grow by at least 25% in 2010 due in large part to price rises. We believe the Dutch petrochemicals industry is best placed to take advantage of modest inventory restocking and uplift in overall demand and will benefit from its advanced and diversified product portfolio. With polymer demand linked to GDP growth, a recovery in consumer spending and investment in both the Netherlands and the rest of the eurozone is crucial to the recovery of the Dutch petrochemicals industry.
The industry faces a likely slowdown in growth in 2011, caused by EU-wide fiscal austerity measures and the expected slump in car making – a major consumer of PP – following the withdrawal of purchase incentives, and the slow revival in construction, which is the chief consumer of PVC. The onset of fiscal austerity in eurozone economies should constrain consumer demand and hamper Dutch export growth. Although sovereign risks remain prevalent, we do not foresee a renewed bout of euro-depreciation to match that seen in May and June. Therefore, the increase in competitiveness enjoyed by petrochemicals exporters over this period is unlikely to be replicated in the near future.
Despite the downside risks, Dutch petrochemicals still offer some distinct competitive advantages in the medium to long term. The size and integration of the Dutch petrochemicals industry enables economies of scale, which means investors will sustain their interests in some segments where global market conditions are favourable. However, a volatile Asian market and a fragile recovery means that product are unpredictable, making it too early to say whether Dutch petrochemicals production will see any growth in value in 2011. While BMI does not envisage new olefins and polyolefins plants in the Netherlands in the next five years, producers will focus on upgrading existing production capacities in order to enhance competitiveness with the possibility of incremental cracker capacity projects.
With 71.8 points, the Netherlands is in third place out of six countries assessed in BMI’s West European Petrochemicals Business Environment Rating. A rapid recovery in country risk ratings led to a 1.6 point rise in its score and increasing its position in the rankings from fifth place last year. It is now 1.4 points behind France and 0.6 points ahead of Belgium. The Netherlands scores close to the regional average in petrochemicals-related scores, but its overall score is held back by relatively poorer risk ratings related to long-term financial and external risk, wiping the shine off its scenario for risk to realisation of potential returns.
The Dutch chemical industry saw turnover grow by at least 25% in 2010 due in large part to price rises. We believe the Dutch petrochemicals industry is best placed to take advantage of modest inventory restocking and uplift in overall demand and will benefit from its advanced and diversified product portfolio. With polymer demand linked to GDP growth, a recovery in consumer spending and investment in both the Netherlands and the rest of the eurozone is crucial to the recovery of the Dutch petrochemicals industry.
The industry faces a likely slowdown in growth in 2011, caused by EU-wide fiscal austerity measures and the expected slump in car making – a major consumer of PP – following the withdrawal of purchase incentives, and the slow revival in construction, which is the chief consumer of PVC. The onset of fiscal austerity in eurozone economies should constrain consumer demand and hamper Dutch export growth. Although sovereign risks remain prevalent, we do not foresee a renewed bout of euro-depreciation to match that seen in May and June. Therefore, the increase in competitiveness enjoyed by petrochemicals exporters over this period is unlikely to be replicated in the near future.
Despite the downside risks, Dutch petrochemicals still offer some distinct competitive advantages in the medium to long term. The size and integration of the Dutch petrochemicals industry enables economies of scale, which means investors will sustain their interests in some segments where global market conditions are favourable. However, a volatile Asian market and a fragile recovery means that product are unpredictable, making it too early to say whether Dutch petrochemicals production will see any growth in value in 2011. While BMI does not envisage new olefins and polyolefins plants in the Netherlands in the next five years, producers will focus on upgrading existing production capacities in order to enhance competitiveness with the possibility of incremental cracker capacity projects.
With 71.8 points, the Netherlands is in third place out of six countries assessed in BMI’s West European Petrochemicals Business Environment Rating. A rapid recovery in country risk ratings led to a 1.6 point rise in its score and increasing its position in the rankings from fifth place last year. It is now 1.4 points behind France and 0.6 points ahead of Belgium. The Netherlands scores close to the regional average in petrochemicals-related scores, but its overall score is held back by relatively poorer risk ratings related to long-term financial and external risk, wiping the shine off its scenario for risk to realisation of potential returns.
Contents
Executive SummarySWOT Analysis
Netherlands Petrochemicals Sector SWOT
Netherlands Political SWOT
Netherlands Economic SWOT
Global Overview
Petrochemicals Market Overview
Financial Results
Global Oil Products Price Outlook
Table: Oil Product Price Assumptions, 2010 (US$/bbl)
Table: Oil Product Price Forecasts, 2008-2015 (US$/bbl)
European Petrochemicals Overview
Table: Financial Results Of European Petrochemicals Producers, Q110 (EURmn)
Business Environment Ratings
Table: Western Europe Petrochemicals Business Environment Ratings
Limits Of Potential Returns
Risks To Realisation Of Returns
Market Overview
Table: Netherlands’ Olefins Facilities 2010
Table: Netherlands’ Aromatics and Intermediates Facilities 2010
Competitive Landscape
Industry Trends And Developments
Mergers And Acquisitions
LyondellBasell Bankruptcy
Industry Forecast Scenario
Table: Netherlands’ Oil & Gas And Petrochemicals Sector, 2008-2015 (‘000 tonnes, unless otherwise stated)
Macroeconomic Forecast
Table: Netherlands – Economic Activity, 2007-2015
Table: Netherlands’ Long-Term Macroeconomic Forecasts, 2013-2020
Company Profiles
LyondellBasell Industries
Sabic Europe
Country Snapshot: Netherlands Demographic Data
Section 1: Population
Table: Demographic Indicators, 2005-2030
Table: Rural/Urban Breakdown, 2005-2030
Section 2: Education And Healthcare
Table: Education, 2002-2005
Table: Vital Statistics, 2005-2030
Section 3: Labour Market And Spending Power
Table: Employment Indicators, 2000-2005
Table: Consumer Expenditure, 2000-2012 (US$)
Table: Average Annual Wages, 2000-2012
BMI Methodology
How We Generate Our Industry Forecasts
Chemicals And Petrochemicals Industry
Cross Checks
Business Environment Ratings
Table: Petrochemicals Business Environment Indicators And Rationale
Table: Weighting Of Indicators Skip to top