Industry Risk Ratings Synopsis

This Industry Risk Ratings report from IBISWorld evaluates the inherent risks associated with the Titanium Dioxide and Other Inorganic Chemical Manufacturing in Australia industry. Industry Risk is assumed to be 'the difficulty, or otherwise, of the business operating environment'.

The report looks at the operational risk associated with this industry. Three types of risk are recognized in our analysis. These are: risk arising from within the industry itself (structural risk), risks arising from the expected future performance of the industry (growth risk) and risk arising from forces external to the industry (external sensitivity risk).

This approach is new in that it analyses non-financial information surrounding each industry. Industries are scored on a 9-point scale, where 1 represents the lowest risk and 9 the highest. The Industry Risk score measures expected Industry Risk over the coming 12-18 months.

Industry Definition

This industry covers companies involved in the production of a variety of basic inorganic chemicals. Inorganic chemicals are those chemicals that are often of a mineral origin but are not of a basic carbon molecular. Given that they do not contain organic carbon they are primarily made from mineral ores, air and water and thus do not require much in the way of feedstock energy. The products produced by this industry are intermediate products used as basic chemicals in industrial processes or manufacturing products, thus key customers include various manufacturers. Key identifiable products within the industry include titanium dioxide, sodium cyanide, industrial grade ammonia, caustic soda, sulphuric acid, soda ash and chlor-alkali products. The industry is not involved in the production of cooking or table salt nor in the production of silicon carbide or other synthetic abrasives.

Report Contents

Risk Overview

The Risk Overview chapter includes sections on Industry Definition and Activities, Industry Risk Score and Risk Rating Analysis. The Industry Definition and Activities section provides a detailed definition of the activities carried out by operators in this industry as defined in NAICS. A list of the primary activities of the industry is also included. The Industry Risk Score section provides the Overall Industry Risk Score as well as the Risk Scores for each of the three types of risk covered that combine to form the Overall Industry Risk Score. These three types of risk are Structural Risk, Growth Risk and External Sensitivity Risk. The Risk Rating Analysis section discusses the underlying factors contributing to the Overall Industry Risk Score.

Structural Risk

The Structural Risk chapter looks at risk arising from within the industry itself and provides a detailed discussion of the industry’s level of exposure to seven key indicators. These key indicators are Barriers to Entry, Competition, Industry Exports, Industry Imports, Level of Assistance, Life Cycle Stage and Volatility of Industry. The Overall Structural Risk Score is a weighted aggregation of these seven key indicators. Each of the key indicators is discussed in detail in this section.

Growth Risk

The Growth Risk chapter looks at risks arising from the expected future performance of the industry. The Overall Growth Risk Score is determined by amalgamating the scores for Recent Industry Growth and Forecast Industry Growth. Detailed analysis is provided discussing the reasons for the growth scores of both.

Sensitivity Risk

The Sensitivity Risk chapter looks at risks arising from forces (sensitivities) external to the industry. The Overall External Sensitivity Risk Score is determined by identifying the most significant (up to 6) external factors and weighting them to represent how significant each sensitivity is to the performance of the industry. Examples of External Sensitivities are Exchange Rates, Interest Rates, Commodity Prices and Government Regulations. There is also a detailed analysis of the affect each of the sensitivities has on the industry, including charts and data tables where appropriate.

Industry Risk and Industry Risk Scoring Methodology

This chapter provides an overview of how IBISWorld defines Industry Risk and discusses the methodology used to arrive at an Industry Risk Score. There is also a table that provides a definition of the seven levels of Industry Risk.

C2535 - Titanium Dioxide and Other Inorganic Chemical Manufacturing in Australia
B1314 - Gold Ore Mining in Australia
C2541 - Explosive Manufacturing in Australia
C2542 - Paint Manufacturing in Australia
C2545 - Soap and Detergent Manufacturing in Australia
C2610 - Glass and Glass Product Manufacturing in Australia
D3701 - Water Supply in Australia

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