Business Monitor International


Brazil Petrochemicals Report

Published 06 October 2014

  • 85 pages
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$1,295.00
Brazil Petrochemicals Report

The Brazilian chemicals industry continues to lose competitiveness due to its dependence on high cost feedstocks and the effects of water shortages and electricity black-outs, according to BMI's latest Brazil Petrochemicals Report.

In H114, the Brazilian petrochemicals industry saw a negative performance in all polymer segments. Domestic production of thermoplastic resins dropped by 5.2% y-o-y and the capacity utilisation rate was down three percentage points compared to H113 to 78%. In the 12 months to end-June 2014, production fell 2% on the back of a 5.5% fall in exports and 7.5% growth in imports.

Polymers consumption fell 3.1% y-o-y in H114. In view of the market contraction in H114 and faltering economic recovery, with our GDP growth forecast revised from 2.0% to 1.8%, we now envisage a contraction in the petrochemicals market in 2014, a revision from the zero growth forecast in the previous quarter. Further monetary tightening, significant exchange rate weakness and ongoing project delays in the infrastructure sector will negatively impact on consumption. The situation for basic chemicals is compounded by a strong inflow of imported resins benefitting from tax incentives.

Exports declined 9.1% y-o-y in the first half, although imports stayed stable with growth of 0.3%. The near-zero growth rate in imports includes a 15.1% y-o-y decline in PVC imports that accompanied growth in domestic output and reduced demand. All other resins exhibited increased imports, especially polyethylene, which rose 7.7% y-o-y and polypropylene, with a rise of 15.5%. As a result, there was deterioration in the polymers trade deficit from 390,000 tonnes to 440,000 tonnes, an increase in volume of 12.8% y-o-y. In the 12 months to end-June 2014, the polymers trade deficit by volume grew 36.7% y-o-y. The situation has been exacerbated by a decline in trade with Argentina, one of Brazil's principal export markets, as well as lack of competitiveness.

We expect that further...

Table of Contents

BMI Industry View
7
SWOT
9
Political
10
Economic
11
Business Environment
13
Industry Forecast
15
Table: Brazil's Petrochemicals Sector, 2010-2017 ('000tpa, unless otherwise stated)
17
Macroeconomic Forecasts
19
Economic Analysis
19
Table: Brazil - Economic Activity
25
Industry Risk/Reward Ratings
26
Americas Risk/Reward Ratings
26
Divergence: Large Markets Take The Lead
26
Table: Americas Petrochemicals Risk/Reward Ratings (Scores Out Of 100)
29
Industry Risk Reward Ratings
29
Market Overview
30
Long-term Capacity Trends
30
Industry Trends And Developments
32
Foreign Ventures
33
Bioplastics
34
Company Profile
36
Braskem
36
Petr-leo Brasileiro
40
Regional Overview
46
Latin America Overview
46
2013: A Better Year For Sales
46
Latin America: Leading Emerging Market Consumption Growth
46
No Prospect Of A South American Shale Boom
47
US Shale Creates Uncertainty In LatAm
48
Brazil Weakening, But Only Mexico Gaining
48
Global Industry Overview
51
Global Petrochemicals Overview
51
Change In Feedstock, But Not In Market Cycle
52
Polymers Heading On Different Trajectories
54
Global Oil Products Price Outlook
54
Table: BMI's Oil Price Forecasts, Average Price (US$/bbl)
55
Table: BMI's Refined Products Forecasts
55
Refiners: Is The Party Over-
58
Jet Fuel: Middle East & Africa Remain Positive As Global Air Traffic Slumps
61
Table: Total Air Freight & Passenger Volumes
63
Gasoline And Diesel: Demand Destruction Takes A Toll
63
Naphtha: Asia Stays Afloat While Europe Sinks
64
Bunker Fuels: Trans-Pacific Route Rebound Amid High Prices
64
Demographic Forecast
67
Demographic Outlook
67
Table: Brazil's Population By Age Group, 1990-2020 ('000)
68
Table: Brazil's Population By Age Group, 1990-2020 (% of total)
69
Table: Brazil's Key Population Ratios, 1990-2020
70
Table: Brazil's Rural And Urban Population, 1990-2020
70
Glossary
71
Table: Glossary of Petrochemicals Terms
71
Methodology
72
Chemicals And Petrochemicals Industry
72
Cross Checks
73
Risk/Reward Ratings
73
Table: Petrochemicals Risk/Reward Indicators And Rationale
74
Weighting
75
Table: Weighting Of Indicators
75

The Brazil Petrochemicals Report has been researched at source, and features Business Monitor International (BMI)'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 Brazil Petrochemicals Report provides industry professionals and strategists, sector analysts, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Brazilian petrochemicals industry.

Key Benefits

  • Benchmark BMI's independent petrochemicals industry forecasts to test other views - a key input for successful budgetary and planning in the Brazilian petrochemicals market.
  • Target business opportunities and risks in the Brazilian petrochemicals sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Brazil.
  • Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. KPIs and latest activity).

Coverage

BMI Industry View

Summary of BMI's key industry forecasts, views and trend analysis, covering petrochemicals markets, regulatory changes, major investments, projects and company developments.

Market Overview

Structure, size and value of the industry sector; overview of the industry landscape and key players; assessment of the business operating environment and the latest regulatory developments.

Business Environment Rankings

BMI's Petrochemicals Business Environment Rankings provide a country-comparative Risk-Reward Rankings index aimed at investors (both corporate and financial) in the regional petrochemicals market.

The rankings methodology makes sophisticated use of over 40 industry, economic and demographic data points and is part of BMI's integrated Country Risk-Industry Rankings products.

Industry Trends & Developments

Evaluation of company and sector-wide developments, including key projects (as well as expansion plans), latest company financial details and proposed international ventures.

BMI Industry Forecasts

Historic data series (2009-2012) and forecasts to end-2018 for all key industry and economic indicators supported by explicit assumptions, plus analysis of key risks to the main forecasts. Indicators include:

Energy: Oil production (`000 b/d), oil consumption (`000 b/d), net oil exports (`000 b/d), gas production (bcm), gas consumption (bcm), net gas exports (bcm), oil refinery capacity (`000 b/d).

Petrochemicals: Ethylene capacity (`000 tpa), ethylene production (`000 tpa), ethylene consumption (`000 tpa), polyethylene capacity (`000 tpa), polypropylene capacity (`000 tpa), polyvinyl chloride capacity (`000 tpa), polyolefins consumption (`000 tpa).

Oil Products Prices: Price forecasts for all major oil-based products (US$/bbl) at major global energy trading hubs.

Economic: Nominal GDP (US$bn), real GDP growth (%), GDP per capita (US$), population (mn), unemployment (%), exchange rate (against US$).

Company Profiles

Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI's industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.

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Testimonials

'An essential, multi-faceted research tool. BMI’s thorough understanding of the major market players enables an informed – and informative – review of the sector’s actual performance, together with useful insights into current industry issues, which are topped-off with detailed and invaluable forecasts of industry and macroeconomic trends.’

Senior Research Analyst, ABC International Bank plc