The global chemical industry is said to undergoing huge changes. This transformation was brought about by the increasing focus on and growth of the Chinese economy and other emerging markets. Other factors like the effects of the US shale gas revolution have led to restructuring of the chemical sector and the logical capabilities that sustain the industry.
Nearly two decades ago the effects of globalisation caused a shift in the chemical production centres, which moved from single economies to large continental clusters. These clusters serve their hinterland and also market their products on a global scale. For instance, in the Middle East, both the Gulf Emirates and Saudi Arabia are selling their output into some of the key markets, including Asia, North America and Europe. However, the region now faces tough competition from an unlikely source. The American chemical sector was on the verge of decline, but the shale gas revolution in the US and Canada has improved the industry’s prospects of becoming a major exporter to markets like China. The importance of the chemical logistics sector cannot be denied. This sector provides chemical producers with an opportunity to gain access to global markets.
This shift in global trade has proved beneficial for logistics providers. The beneficiaries include marine bulk storage providers led by Vopak, operators of tank container who can flex their business model to an intercontinental reach.
The chemical tanker sector is more under control when compared to the shipping sector, however the tanker sector is not booming. The chemical terminal and businesses are affected by rapid changes in the chemical trade flows. However, long term developments mean excellent opportunities for those in the right location. But things can go haywire for the ones in the wrong location. Small and medium-sized production locations are threatened by the comparative cost of energy and large scale economies in logistics.
Logistics for downstream products is varying at a slower rate due to the slow change in the nature of customer demand. The most significant development is the rise in demand in China. However, India, South East Asia, Eastern Europe, Turkey and parts of South America continue to have a large appetite for downstream chemical logistics development.
Even the developed markets have witnessed the effects of changing patterns of chemical trade on downstream logistics. The chemical logistics sector is expected to grow by 3 per cent, keeping in-line with the expansion of the chemical sector.
The logistics providers will benefit from a number of opportunities provided by the chemical sector, but the ones who succeed will be the ones who identified the new opportunities and placed themselves in a position to take advantage of it.
Follows us:
worth reading.....
ReplyDelete