Just Published: "United States Petrochemicals Report Q2 2015"

The US petrochemicals industry saw a decline in resins output and sales in 2014, but with capacity growth set to abate until 2016 at the earliest, BMI expects tightening markets in 2015 that should help protect margins from foreign competition.

In the January-October 2014 period, resin output was down 2.5% year-on-year (y-o-y) to 28.1mn tonnes amid a spate of unplanned cracker outages. Nevertheless, output in several key chemistry end-use markets expanded, including automotive, construction and plastic products. After nearly five years, headline industrial production surpassed its previous peak. Recent resurgence in the industrial sector and balanced chemical inventories bodes well for future chemical production.

Capacity growth will be limited to the expansion of existing facilities with no new crackers expected until 2016 at the earliest. As such, the market will become tighter as 2015 progresses, pushing up spot prices.

* The US petrochemicals industry continues to expand on the back of growth in ethane availability as a result of shale gas exploitation. With exports and domestic demand growing, industrial growth is firming up and giving a positive scenario over the medium term. However, a glut in global capacity as a result of new crackers in the US will put pressure on margins in the long term.
* An upgrade in our construction forecast should provide some upside for construction-related chemicals such as PVC, although the recovery will trend lower as the residential construction industry normalises.
* Production growth in the automotive industry is set to moderate due to capacity constraints. However, growth is set to continue steadily over the medium-term thereby ensuring considerable upside for petrochemicals producers, particularly in engineering polypropylene products, polyurethane upholstery and synthetic rubbers which are used in the manufacture of vehicles.
* The US scores 90.4 points in BMI's Americas Regional Petrochemicals Risk/Reward Index, 11.9...

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The United States Petrochemicals Report has been researched at source, and features BMI Research's market assessment and independent forecasts for key petrochemicals sub-sectors. The report also analyses the impact of regulatory changes, recent developments and the background macroeconomic outlook and features competitive landscapes comparing companies by products and services, sales, market share, investments, projects, partners and expansion strategies.

BMI's United States Petrochemicals Report provides industry professionals and strategists, sector analysts, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the American petrochemicals industry.

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