Chemical Industry - Economic Outlook 2011
(per the American Chemistry Council)
Dr. Kevin Swift, Chief Economist at the American Chemistry Council gave a riveting presentation to a packed house at yesterday’s lunch meeting of the CM&E group. A crowd of 80 chemicals executives, bankers, investors, lawyers, consultants and other service providers heard data-packed and highly useful analysis of where we are in the chemicals cycle and where we go next. The lunch audience, including senior members of BASF, Rhodia, Lonza, Helm, Mitsui, Lonza, Huber and DSM was joined by webcast attendees from across North America, Europe and Asia. Hard data and concise opinion was served up with grace and humor and everyone went away with something they would use in their chemicals activities in the coming year.
And before you ask, no I cannot send you the slides and yep – I have to say again– you really do “gotta be there”. However, in this case, I am told you will soon be able to purchase access to a recording of the webcast, with the slides, here. In coming months I urge you to come to some of these meetings as we have BASF speaking in February, a Green Chemistry panel in March and in May, the long awaited Latin American event, sponsored by CM&E’s own cachaça distiller, Sagatiba of Brazil (yes, that is free caipirinhas for all attendees - and we haven’t yet figured out how to deliver those via the webcast).
Some bullets from Kevin’s talk to give you a flavor of what we enjoyed:
- We are about 25% of the way up between last year’s trough and the next peak for our industry.
- Car manufacturing recovery and growth particularly in China pulls along a lot of chemicals – about $2,400 worth of chemicals per car.
- Housing is an issue. We have a double dip here in the US and that is a concern as each new house is worth about $17K in chemicals. In addition, household debt is climbing at a rate that suggests a reckoning has to come due and the risk for the US economy cannot be ignored.
- Shale gas featured very prominently in the talk and Kevin’s view of this as a game changer for North American Chemicals was very well received. A number of off-line discussions I had at the event, confirmed that serious investment decisions will be made with the shale gas economic effect on the chemical value chain – a huge factor. By the way, I have to add that the networking, pre and post the talk - at this event was outstanding.