Taiwan’s petrochemical industry is likely to see its output value slightly shrink 1.1% year on year to NT$1.89 trillion in 2012, as it feels the heat of emerging rivalry and debt crisis in Europe, according to the latest report authorized by Industrial Economics & Knowledge Center (IEK), as per CENS.
Q1-2012 saw this industry benefit from hikes in global oil prices amid an economic sanctions and oil embargo by the nations of the West on Iran. A robust growth of 9.9% in output value of NT$483 billion compared to a quarter ago was seen in Taiwan. However, the industry is likely to lose its growth momentum starting in Q2, mainly due to skyrocketing prices of petrochemicals triggered by declining supply as Asian producers have begun scheduled plant maintenance likely to suppress market demand to erode the industry’s overall growth. As a result, IEK commented that the industry’s output value is estimated to slacken to NT$490.8 billion for a flat growth of only 1.6% compared to a quarter ago. The industry’s downtrend will almost certainly continue for the rest of the year, as IEK analysts indicated that growing investments in petrochemical facilities in emerging countries along with the lingering debt turbulence in EU member count countries will increasingly impact exports of Taiwan’s petrochemical industry, especially when the global economic doldrums is thought to severely dampen market demands for oil worldwide throughout the year. Therefore, the analysts project the industry’s annual output to reach NT$1.89 trillion for a 1.1% yearly decline this year. The sector of petrochemical material manufacturing, which commands the largest share of Taiwan’s overall output of petrochemical products in value, posted a brisk quarterly growth of 14.7% in production value in the first quarter of this year, according to IEK’s report.