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EU chemical production grows ever so slowly

11.01.2011  |  Thinnes, Billy,  Hydrocarbon Processing Staff, Houston, TX

Keywords: [EU] [European Union] [chemcials] [chemcial production] [chemical sector] [net trade] [inorganics] [plastics] [speciality chemcials]

European Union (EU) chemicals production in July grew by 0.8% compared with July 2010, according to the latest chemicals trends report released by the European Chemical Industry Council (Cefic). However, that figure continues a trend of slower-than-expected growth, the group said.

Production moved back into positive territory in July after output in June had moved slightly into negative territory. The July production figure dragged down further year-to-date output growth, which now stands at 3.0% for the first seven months of the year, well below the 4.5% full-year 2011 forecast by the trade group in late June.

Data showed a near double-digit, year-on-year price increase in July, led by a 15.2% overall price increase in petrochemicals. For the first six months of 2011, the EU chemical sector net trade surplus reached €20.4 billion, off by €3.2 billion when compared with the same period in 2010.

“The July EU chemical production data show the pace of growth stalling a bit, continuing the trend seen during an unexpectedly moderate second quarter,” Cefic chief economist Moncef Hadhri said. “After an impressive first quarter, the sector appears to have downshifted, in line with EU industrial growth. Despite slow growth in June, EU chemicals production levels remain 19.4% higher as compared with the December 2008 trough.”

Chemical output up. EU chemicals output rose in July 2011 compared with July 2010. The EU production index for July was up 0.8% compared with July the year prior. Petrochemicals output increased 1.4% in July compared with the year prior, while basic inorganics production rose by 5.1%. Year-on-year consumer chemicals production rose by 5.9% in July; specialty chemicals and polymers output fell by 2.2% and 0.8%, respectively.

Trade surplus. Trade data show a €20.4 billion trade surplus for the EU chemicals sector in the first six months of 2011(Fig. 2), down 13.6% compared with the same period in 2010. The EU-27 posted a €5.4 billion net trade surplus with the NAFTA region from January to June and a €3.3 billion surplus with Asia, excluding Japan and China. The EU sector ran a €1.3 billion net trade deficit with China. The EU net trade surplus with non-EU Europe reached €6 billion.

Sales level trending higher. The June sales level increased, remaining above the pre-crisis peak. June 2011 chemicals sales were 5.6% higher compared with June the year prior. For the first six months of 2011, total sales were 16.9% higher as compared to the same period in 2010. Sales values during first half of 2011 were 5.0% higher compared to the peak level reached in first half 2008.

Price increase for basic inorganics. Basic inorganics prices pushed upward 14.4% year-on-year during July, and plastics were up 9.1%. The price of consumer chemicals continued to increase modestly, up 3.0% year-on-year for July.  HP


  Fig. 1. Trade data shows a €20.4 billion trade surplus for
  the EU chemicals sector in the first six months of 2011,
  down 13.6% when compared with the same period in 2010.


  Fig. 2. June 2011 chemical sales were 5.6% higher compared with June the year prior.

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