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[ClickPress, Fri Nov 13 2015] Although 2014 ended on a downturn, BMI believes the petrochemicals market should be robust enough to lift output in 2015. As a net hydrocarbons importer, weaker oil prices are helping Romania's downstream sectors. Even the financially troubled polymer producer Oltchim could see a buyer by the end of the year.
Weaker oil prices have helped Romania's downstream sectors with refining margins improving as a result, reversing the situation of regular quarterly losses. This is helping drive down the cost of naphtha feedstock used in the petrochemicals industry, with Oltchim reporting an operating profit for the first time in years in H115. This is prompting renewed interest in the financially troubled polymers producer, which has suffered as a result of a cut in feedstock supply from the Arpechim refinery.
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In January-April 2015, chemicals output declined by 0.8% y-o-y, but rubber and plastic notched up an impressive performance with growth of 7.8% y-o-y. Romania has modest olefins capacities of 200,000 tonnes per annum (tpa) ethylene and 100,000tpa propylene feeding capacities totalling 320,000tpa polyethylene and 80,000tpa polypropylene. Romania also has 60,000tpa polystyrene and 170,000tpa polyvinyl chloride (PVC). As such, the industry is small and lacks economies of scale to compete with foreign producers. Also, it is constrained by the problems at Oltchim, caused in large part by the closure of the Arpechim refinery that fed it naphtha feedstock.
Oltchim may be offered a lifeline from a Chinese investor, which is reportedly interested in acquiring the unit. It is understood that the investor is seeking to exploit crude oil in Romania to supply feedstock to operate the Oltchim's chemicals plant. With adequate feedstock, the Oltchim plant would be in a position to operate at 65% of capacity rather than the current 30%.
The Romania 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 Romania Petrochemicals Report provides industry professionals and strategists, sector analysts, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Romanian petrochemicals industry.
* Benchmark BMI's independent petrochemicals industry forecasts to test other views - a key input for successful budgetary and planning in the Romanian petrochemicals market.
* Target business opportunities and risks in the Romanian petrochemicals sector
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