GCC chem industry should work with govts to expand jobs

(ICIS) -- The chemical industry in Gulf Cooperation Council (GCC) countries could help drive job creation in the region by working closely together with its governments, a top industry official said on Thursday. ⌠Given the employment challenge, the need for labour-intensive industries is mounting, even if it entails a partial sacrifice of economic returns from the chemical producers, said Abdulwahab Al-Sadoun, general secretary of the GPCA, speaking at the 6th GPCA forum in Dubai.

A large part of the population in the GCC states is under the age of 25 with their percentage of total population ranging from 28% in Qatar to 49% in Saudi Arabia. In the past ten years, the GCC as a whole created 7m job opportunities but only 2m jobs were taken by GCC nationals, according to Al-Sadoun.

⌠The industry's potential for job creation could be realized when GCC governments and regional chemical producers come together to successfully navigate [job creation] challenges, he said.

The extent to which they successfully overcome these challenges will have a direct impact on number of jobs created across the region, not just in the chemical industry but in conversion industries, which will be stimulated by production of new chemical products, Al-Sadoun said.

From the industry perspective, talent management and securing steady talent inflow to the market is key to long-term sustainable growth, he said. Access to diverse and skilled pools of technicians, engineers, managers and support staff is vital for successful industry expansion, according to Al-Sadoun.

The downstream chemicals industry provides greater employment opportunities than commodity chemicals and oil & gas exploration, said Andrew Monro, a partner and global head for petrochemicals at KPMG at the GPCA forum.

MRC

(ICIS) -- European producers of dioctyl phthalate (DOP) are turning down sales to avoid negative margins, market sources said on Thursday. Prices in northwest Europe are at EUR1,280-1,340/tonne FD (free delivered), although some producers are reportedly declining bids below EUR1,350/tonne (USD1,753/tonne) FD. ⌠We are not selling any product below EUR1,350/tonne as there is no margin at these levels, said a northwest European producer.

Other local suppliers are currently selling material at EUR1,300/tonne FD NWE (northwest Europe) and above, and are reluctant to negotiate lower prices. ⌠If demand does not recover, production will be reduced accordingly, said one producer. However, cheaper material is being sold by eastern European producers, with offers in the high EUR1,200s/tonne FD NWE.

Several DOP producers in Europe supply 2-ethylhexanol (2-EH) and phthalic anhydride (PA), while they purchase orthoxylene (OX) from third parties. One producer said: ⌠Each producer has a different production cost base, as they have access to raw material at different price levels."

Depressed conditions in DOP, which accounts for two-thirds of the low-phthalate market in Europe, are caused by a number of factors.

Firstly, the long-term negative sentiment caused by European environmental restrictions has led to a gradual shift of demand to Reach-friendly high-phthalate compounds such as di-isononyl phthalate (DINP) and di-propyl heptyl phthalate (DPHP). Reach - the registration, evaluation and regulation of chemicals - is the EU chemical regulation programme.

Secondly, the downtrend has been exacerbated by depressed conditions in the downstream polyvinyl chloride (PVC) and construction sectors, in which activity remains far below pre-crisis levels.

Thirdly, fears of a double-dip recession have led producers of plasticisers to bring the annual destocking cycle forward, leading to an improvement in product availability and lower prices in alternative products such as DINP and DPHP.

Consumption is at a record low, with very few spot deals heard in the market and some producers struggling to find customers or secure contracts for January. Week-on-week decreases brought Europe's DOP spot values down to a 20-month record low two weeks ago. However, recent cuts in operating rates to 50-60% at some manufacturing sites have successfully stabilised prices.

MRC

(ICIS) -- China's Ministry of Commerce announced on Thursday it has implemented anti-dumping and anti-subsidy duties on some US-made cars with effect from 15 December. The ministry said in a statement on its website it will start imposing duties on imported saloon and cross-country cars made by US companies, with a cylinder capacity of more than 2,500cc, from 15 December this year to 14 December 2013. China currently imposes a 25% tariff on imported cars.

The companies listed for the duties include General Motors, Chrysler Group, Honda Motor, Mercedes-Benz and BMW, according to the statement. General Motors and Chrysler will be the most affected, with anti-dumping duties at 8.9% and 8.8% respectively, while each will face anti-subsidy duties of 12.9% and 6.2% respectively, according to the statement.

⌠It is reasonable self-defense for China and more of a signal that China is exerting pressure on US trade protectionist moves, said Zhou Shijian, an expert on China-US trade from Tsinghua University. The ministry released a final ruling on the anti-dumping and anti-subsidy investigations on imports of US automobiles on 5 May this year.

It ruled that the dumping and subsidy simultaneously exist for imports of saloon and cross-country cars, with a cylinder capacity of more than 2,500cc, originating from the US, causing material injury to China's automobile industry.

China sold 1.66m vehicles in November this year, which is a decrease of 2.42% year on year, but an increase of 8.6% from October, according to data from China Association of Automobile Manufacturers (CAAM).

The country's vehicle production in November dropped by 3.41% on year to 1.7m units, which represents a growth of 7.95% from October, the CAAM said.

MRC

(Sabic) -- Mohamed Al-Mady, SABIC Vice Chairman and CEO and Chairman of the Gulf Petrochemicals and Chemicals Association, has expressed optimism over 2012 being another positive year for the region's petrochemical industries despite concerns over Europe slipping back into recession as a result of the ongoing sovereign debt crisis.

In his opening remarks to a large gathering of industry leaders from about 45 countries at the three-day Sixth Annual GPCA Forum in Dubai on December 13, Al-Mady based his optimism on the general consensus that the Eurozone will have a slightly positive growth, and the US will avoid a double dip recession. The GPCA Forum is being held from December 13 to 15 under the theme ⌠Moving Downstream Creating Added Value and Sustainable Growth.

Speaking further, Al-Mady said, ⌠If this growth forecast prevails in 2012, it should be a good year for our industry. Financial results should receive an additional boost due to improved industry operating rates in 2012 as there will be less new capacity coming on stream. He also pointed out to the good profitability enjoyed by most chemical producers in 2011.
Al-Mady stressed that Innovation will always be key driver in the petrochemical industry's efforts to remain competitive and relevant players.

On the issue of Sustainability, Al-Mady said that just as the petrochemical industry has provided the technology that has contributed tremendously to good health, good lifestyles and global mobility, it must now provide business solutions for a sustainable planet. ⌠The Gulf petrochemical suppliers must possess the most material and energy efficient processes and we must produce products that enable the entire value chain to be more sustainable.

MRC

(Sumitomo) -- In a move aimed at strengthening their respective alumina and aluminum trihydroxide (ATH) businesses, Sumitomo Chemical (Tokyo / Japan) has entered into a collaboration with Germany's Nabaltec (Schwandorf). In a first step, starting 1 December 2011, Nabaltec began supplying Sumitomo with its fine precipitated ATH grade for sale in East Asia.

Aluminum trihydroxide mostly is used as a flame retardant additive for polymers used in wire and cable, printed circuit board and building materials applications. Demand for the material has been rising amid new regulations curtailing the use of halogenated flame retardants, especially in Europe.

Although the Japanese group has expanded its production capacity for ATH at its plant in Ehime / Japan over the past few years, the rapid rise in demand meant Sumitomo was looking to secure additional supplies, which is where Nabaltec - one of the world's leading ATH producers with plants in Europe and the US - entered the picture. Both companies said they plan to explore additional areas of cooperation, including joint development of new advanced inorganic materials.

MRC