Chemical industry back on track

31-May-2010 - Netherlands

Dutch chemical industry production shows a substantial recovery. In particular, basic chemicals showed a sharp increase in demand. This was reported by the Netherlands Chemical Industry Association (VNCI) during a presentation of the economic results in The Hague. A structural recovery is still uncertain, and partly depends on the developments in the financial markets.

In the first quarter of 2010, production showed a 21.7% increase compared to the first quarter of 2009. This brings production reasonably close to standard levels. This is partly due to buyers building up their stocks again. In the first quarter of 2010, the turnover showed a 34.1% increase compared to the first quarter of 2009. The output prices showed a 12.7% increase. The output prices and corresponding turnover are still approximately 20% off the levels that were achieved shortly before the outbreak of the crisis.

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In his explanatory notes to the economic results, VNCI chairman, Jan Zuidam, emphasised that the volume of orders is still lower than prior to the crisis. He also pointed out that many companies are experiencing a pressure on margins with respect to the current supply and demand ratios; among other things, this is connected to the cost increase in energy and raw materials. The costs necessary to satisfy the laws and regulations are very high particularly in the case of smaller companies. The situation on the financial markets also presents many uncertainties. To what extent the ‘perceived’ recovery is structural therefore remains uncertain.

Results 2009

In 2009, the Dutch chemical industry achieved a turnover of € 38 billion. That is 24% lower than the previous year. Compared to 2008, production showed a 5.1% decrease in 2009. The total export came to approximately € 60 billion (partly re-exportation) in 2009. Although this is a ten percent decrease compared to 2008, the export share to countries outside the European Union showed a 4.5% increase.

Energy

Chemical companies want to continue to invest in order to cut back the use of fossil fuels and to reduce CO2 emissions. Within the framework of the Regiegroep Chemie (Chemistry Directive Group), the sector is aspiring to cut down CO2 emissions by 50% within a 25 year period. The sector recently completed a study that identified the potential for installing additional combined heat and power systems for saving energy. To actively realise energy savings, a firm, consistent and motivating government policy is necessary.

https://www.chemeurope.com/en/news/118230/chemical-industry-back-on-track.html