Romania Petrochemicals Report Q2 2016
BMI View: Weaker oil prices have helped Romania's downstream sectors, with refining margins improving as a result and thereby reversing the situation of regular quarterly losses. This is helping drive down the cost ofnaphtha feedstock used in the Romanian petrochemicals industry, reviving the fortunes of the sector.
Plastic and rubber output grew 7.6% year-on-year (y-o-y) in the first 10 months of 2015, continuing therobust growth reported in 2014. On the downside, the chemicals sector reversed much of the growth seen inthe previous year, falling 2.3% y-o-y. The troubled Romanian producer Oltchim is seeing a turnaround as aresult of growth in polymers with a 31% increase in the valueof sales in 9M15 and a massive drop in losses.
Nevertheless, Romania has modest olefins capacities of 200,000 tonnes per annum (tpa) ethylene and100,000tpa propylene, feeding capacities totalling 320,000tpa polyethylene and 80,000tpa polypropylene.
Romania also has 60,000tpa polystyrene and 170,000tpa polyvinyl chloride. As such, the industry is smalland lacks economies of scale to compete with foreign producers.
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