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A different world - Chemicals 2030

2011

“The past is a foreign country: they do things differently there,” wrote L.P. Hartley. The same may be said of the future. For chemicals, at least, the future is a different world. Looking ahead is never easy and perhaps chemical markets defy prediction more than most. They develop in complex and diverse ways, with shifting demands and large differences between segments and regions. And the last two years of dramatically increased volatility make predictions even trickier.

How do you assess a market so dynamic as this? In our “Chemicals 2030” study, Roland Berger Strategy Consultants develops both a qualitative and quantitative outlook on the industry trends, demand shifts and rival strategies that drive future growth and profits.

The industry will continue to grow. In fact, the market will more than double in the next 20 years, even if for every five-year period the pace of that growth will decline – especially in North America and Europe, where growth at 2% per annum is expected to be just below GDP. Over the next two decades, the center of gravity of the chemical industry will shift inexorably east as China surpasses Europe and North America as the largest chemical market in the world. But India and other Asian countries are also promising. These areas will see growth rates of 5-7% per annum (consider that the industry as a whole has never grown by more than 5% over the last decade). Attractive, high-growth opportunities remain – especially in plastics and specialty chemicals in Asia. Commodity plastics, for example, will grow by more than 8% per year in the short term and 6% in the long term. For paints and coatings we foresee long-term growth rates in excess of 6.5% per year. In emerging markets, growth will be even higher, well above GDP, as demand for better tasting foods and home decoration increase with consumers’ disposable incomes. In these and other segments, there is a lot to play for.

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