2012-10-22 02:24:55 - Hungary Petrochemicals Report Q4 2012 - a new market research report on companiesandmarkets.com

The Hungary Petrochemicals report examines the pressures facing the industry as it deals with the fallout from the eurozone crisis, which will adversely impact domestic export-oriented industries, which remain the key consumers of Hungarian petrochemicals output. The report also assesses the sector´s diversification following an injection of Chinese investment in isocyanates.

In Q112, Hungarian petrochemicals producer MOL reported a 17.1% year-on-year (y-o-y) drop in petrochemicals output, although production was up 3.5% quarter-on-quarter (q-o-q). While olefins product sales grew 7% y-o-y to 92,000 tonnes in Q112, polymer sales declined 23% to 236,000 tonnes leading to a 16% drop in total petrochemicals sales to 328,000 tonnes. The broad-based decline followed the trend reported in H212, which helped negate most of the growth seen

 

 

in H112. Downward pressure on the market, fuelled by the ongoing eurozone crisis, means that both domestic and external demand for Hungarian petrochemicals will remain depressed throughout 2012.

Despite ethylene sales holding up, the decline in polyethylene (PE) will impact on the company´s internal use of the feedstock. The situation is likely to be not as bad in the propylene-polypropylene (PP) chain. In terms of demand, the construction sector will continue to remain in the doldrums and the automotive industry is likely to feel the effects of declines in both external and domestic demand. Expansions in cracker capacity – to 610,000 tonnes per annum (tpa) – have helped reduce ethylene feedstock imports to virtually zero, with 90% of olefins output consumed within Hungary. Over the long term, the Hungarian petrochemical industry´s ability to expand its exports will likely be constrained by capacity.

BMI has revised the following forecasts/views:

• BMI anticipates that in 2012, Hungary will have olefins production capacities of 660,000tpa ethylene and 400,000tpa propylene. It is also due to have polymer capacities of 400,000tpa highdensity polyethylene (HDPE), 210,000tpa low-density polyethylene (LDPE), 650,000tpa polypropylene (PP) and 440,000tpa polyvinyl chloride (PVC). In the fertiliser segment, Hungary is forecast to have capacities of 380,000tpa ammonia and 195,000tpa urea.

• BMI maintains its overall petrochemicals output growth for 2012 at -10%, on the basis that H211 levels of production are unlikely to be exceeded in 2012, due to the effects of the eurozone debt crisis and continued lacklustre demand. The decline will be consistent across all segments, but is set to be worse in polymers.

• In BMI´s Central and Eastern Europe petrochemicals rating, Hungary scores 57.8 points out of 100, netting it fourth position, 0.7 points behind Poland and 9.1 points ahead of Turkey. This score has not changed since the previous quarter.The price of this market report covers 4 quarterly reports on this sector. This quarterly report will be downloadable instantly as a PDF document, with the 3 remaining reports delivered at regular intervals throughout the year.

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