Chemical Industry Production Grows 2.48% ⠀⠀⠀⠀ ⠀⠀⠀⠀⠀⠀⠀⠀

Posted by Marina
The production of chemicals for industrial use grew 2.48% in this third quarter of 2019, compared to the previous quarter, according to information released by the Brazilian Chemical Industry Association (Abiquim). In this scenario, data from the institution's Conjunctural Monitoring Report (RAC) indicate that domestic sales were up 3.05% and domestic demand rose 17%.

According to Fátima Giovanna Coviello Ferreira, who is Abiquim's Director of Economy and Statistics, for industrial chemicals, which are the basis of several industrial chains, the months from July to October are the best of the year, due to Christmas and summer period orders, which raises the demand for disposables and other items. “But despite the recent improvement compared to the third quarter of 2018 results, the indices for the same period this year show negative variations: production fell 9.49%, domestic sales fell 6.49% and apparent national consumption (CAN) fell 11.47% ”, says Abiquim.

In addition, from January to September, capacity utilization remained at 70%, seven points lower than in the same period of 2018, leading to idleness at a record 30%. “The level is inadequate for the chemical sector's continuous process production standards and the increasing idleness worries the companies because it imposes increasing unit costs per ton produced, worsening the national competitiveness relation with the imported product”, explains Fátima .

To complete the picture, a possible unilateral reduction in import tax rates for various products, including a large amount of chemicals manufactured in Brazil, is assessed by the government. “This eventual decision, without the necessary counterparts towards the elimination or reduction of the barriers that affect the competitiveness of the national industry, can have very bad consequences for the whole industry, and especially for chemistry. This framework reinforces the need to accelerate the government's positive agenda measures for the New Gas Market, which should only have an effect on the competitiveness of gas, energy and the supply of oil and gas-based petrochemical raw materials. three or four years, "he concludes.

Source: Agrolink