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Fitch Ratings expect the global chemicals
industry to experience gradual recovery in 2010, with stronger demand in China
and South America tempered by constrained Western European and North American
markets, reports the Associated Press. Fitch expects growth rates for the North
American chemicals industry in the low-to mid-single digits in 2010. Other
factors slowing the sector''s recovery include excess capacity and the end of
stimulus packages. Furthermore, Fitch said new capacity coming online in the
Middle East -- where lower raw material prices translate to cost advantages --
could threaten Western European and North American facilities. The ratings
agency predicted stiff competition for less advanced chemical products.
Companies with a lot of these products in their portfolio will change their
strategy to purely low-cost manufacturing to stay competitive. Companies with
high value-adding, innovative product portfolios, in contrast, will focus on
research and development.
