Some Interesting Data on the Huge Antwerp-Rotterdam Chemical Industry Cluster

A 2014 study entitled “Contribution to Future Oriented Energy Strategy for the Chemical Industry” deals with such topics as the impact of energy and feedstock costs on the competiveness of the Antwerp-Rotterdam (AR) chemical industry cluster.   (Click here to read this study.)  This cluster represents the third largest concentration of chemical companies in the world.

Some major strategic suggestions in the study for increasing the welfare of the chemical companies in the AR cluster include:

-          Increase the synergistic benefits that the cluster can provide to individual 

        chemical companies in the cluster;

-          Encourage cluster members to work together as a whole;

-          Develop cluster-wide expertise in various areas that can be used to influence

        government policy; and

-          Increase integration within the cluster.

In addition to these suggestions for increasing cluster members’ welfare from being in the cluster, data is provided in the study on the AR cluster production and performance.

Management science researchers have long suggested that industrial sector clusters, such as the AR chemical sector cluster, promote the welfare of the individual companies in ways not available to non-clustered companies.   This study should be of interest to other chemical industry clusters, both long-established and emerging.

A Dutch Program for Increasing Electrification in their Chemical Industry

The Dutch-backed program name VoltaChem aims to increase the use of electricity in chemical industry processes.   A VoltaChem white paper provides details on the program (click here to read this whitepaper).

A driving force in using increased electrical energy has to do with the ability to generate this electricity using renewable energy sources, which in turn will led to significant reductions in using fossil fuels in generating the electricity.  The reduction of fossil fuel use is needed in order for The Netherlands to meet European Union carbon dioxide emission standards.  The Netherlands, which currently gets about 10% of its energy from renewable sources, wants to substantially increase this percentage.  A major contribution to this increase is expected to be wind energy, with more major offshore wind farms planned.  Then hopefully this increased renewable energy supply will nicely satisfy a hoped-for increase in electricity demand by the chemical industry.

VoltaChem goals, which are long-term, include increasing chemical industry demands for electrification.   This includes: the use of electricity (versus fossil fuels) in heating processes needed in chemical production; using electricity in generating basic feed stocks such as hydrogen and ammonia; and using electrochemical process in converting feed stocks into higher-value chemical products.

Chemical and Metal Shortage Alert – January 2017

The purpose of this blog is to identify chemical and metal shortages reported on the Internet.  The sources of the information reported here are primarily news releases issued on the Internet.  The issue period of the news releases is January 2017.

Section I below lists those chemicals and metals that were on the previous month’s Chemical and Metal Shortage Alert list and continue to have news releases indicating they are in short supply. Click here to read the December 2016 Chemical and Metal Shortage Alert list.

Section II lists the new chemicals and metals (not on the December alert).  Also provided is some explanation for the shortage and geographical information.  This blog attempts to list only actual shortage situations – those shortages that are being experienced during the period covered by the news releases.  Chemicals and metals identified in news releases as only being in danger of being in short supply status are not listed.

Section I.   Zinc:  global; mining not keeping up with demand

      

Section II.   Shortages Reported in January not found on the Previous Month’s List

Building materials: New Zealand; supply not keeping up with demand

Butadiene:  Taiwan and China; production not keeping up with demand

Coking coal: India; supply not keeping up with demand

Natural latex: Malaysia; supply not keeping up with demand

Reasons for Section II shortages can be broadly categorized as: 

1.  Mining not keeping up with demand: none

2.  Production not keeping up with demand:  butadiene

3.  Government regulations: none

4.  Sources no longer available: none

5.  Insufficient imports:  none

6.  Supply not keeping up with demand:  building materials; coking coal; natural latex

Estimating Future Catalyst Revenues

An Internet search found estimated 2015 global revenues for the three major categories of catalysts.  The categories and revenues are: refining catalysts - $5 billion; environmental catalysts - $7.5 billion; and chemical processing catalysts - $4.8 billion.  These amounts were found in of market study descriptions on the Internet.

Using these estimated 2015 revenues, projected global revenues for each catalyst category were computed for 2016 to 2020.  These computed revenues are shown in the following tables:

revenues refining catalysts	2015	$              5,000,000,000
	2016	$              5,075,000,000
	2017	$              5,151,125,000
	2018	$              5,228,391,875
	2019	$              5,306,817,753	Used in calculating CAGR:
	2020	$              5,500,000,000	1.60%

revenues environmental catalysts	2015	$     7,500,000,000
	2016	$     7,695,000,000
	2017	$     7,895,070,000
	2018	$     8,100,341,820
	2019	$     8,310,950,707	Used in calculating CAGR:
	2020	$     8,750,000,000	2.6%

revenues chemical processing catalysts	2015	$     4,800,000,000
	2016	$     5,054,400,000
	2017	$     5,322,283,200
	2018	$     5,604,364,210
	2019	$     5,901,395,513	Used in calculating CAGR:
	2020	$     6,550,000,000	5.3%

 

The computations were done using proxy compound annual growth rate values (CAGR).  For refining catalysts, the proxy CAGR is based on the increase in global oil and gas production from 2009 to 2014. (Click here to see these production values.)  I am assuming that the 2009 to 2014 CAGR value computed from this production data likely will be close to 2015 to 2020 production data CAGR increases and that the revenue growth in refining catalysts will closely correlate with growth in oil and gas production.

For an environmental catalyst CAGR, I used 2.6%, which is the estimated CAGR from 2015 to 2021 for global automotive production growth.  (Click here for the global automotive production CAGR.)  I am assuming that 2015 to 2020 global environmental catalyst revenue growth rates will closely correlate with automotive production CAGR, since automobiles are assumed to be the major use of environmental catalysts.

For global chemical processing catalyst revenues, I used 5.3%, which is the estimated CAGR for the global plastics market from 2014 to 2020.  (Click here to see this plastic CAGR value.)  I am assuming that 2015 to 2020 global chemical processing catalyst revenue growth rates will closely correlate with global plastic growth rates, since plastics are assumed to be the major use of catalysts in the chemical processing category of catalysts.

The 2015 and projected total global revenues for all three catalyst categories, found in the three tables above, are shown in the following table:

	total revenues - three catalyst categories
2015	$            17,300,000,000
2016	$           17,824,400,000
2017	$            18,368,478,200
2018	$            18,933,097,905
2019	$            19,519,163,973
2020	$            20,800,000,000

These totals compare fairly will with amounts shown in the above referenced market studies.  This suggests that the proxy CAGRs, explained above, serve fairly well in projecting future catalyst revenues from an assumed current, correct value.

Chemical and Metal Shortage Alert – December 2016

The purpose of this blog is to identify chemical and metal shortages reported on the Internet.  The sources of the information reported here are primarily news releases issued on the Internet.  The issue period of the news releases is December 2016.

Section I below lists those chemicals and metals that were on the previous month’s Chemical and Metal Shortage Alert list and continue to have news releases indicating they are in short supply. Click here to read the November 2016 Chemical and Metal Shortage Alert list.

Section II lists the new chemicals and metals (not on the November alert).  Also provided is some explanation for the shortage and geographical information.  This blog attempts to list only actual shortage situations – those shortages that are being experienced during the period covered by the news releases.  Chemicals and metals identified in news releases as only being in danger of being in short supply status are not listed.

Section I.   Zinc:  global; mining not keeping up with demand

      

Section II.   Shortages Reported in December not found on the Previous Month’s List

Ash:  United Kingdom; production not keeping up with demand

Nitrous oxide:  United States; supply not keeping up with demand

Reasons for Section II shortages can be broadly categorized as: 

1.  Mining not keeping up with demand: none

2.  Production not keeping up with demand: ash

3.  Government regulations: none

4.  Sources no longer available: none

5.  Insufficient imports:  none

6.  Supply not keeping up with demand: nitrous oxide

Germany’s Chemical Industry Embraces Industry 4.0 and Digitization

Internet searches find good evidence that the Germany chemical industry is intensely pursuing what is referred to as "Industry 4.0”.  A Deloitte 2016 article provides an excellent overview of what is met by Industry 4.0 and its implications for the chemical industry.  (Click here to read the article – PDF file.)

Implementing Industry 4.0 and increasing digitization throughout their industries is a high priority of the German government.  A study sponsored by the Federation of German Industries and carried out by Roland Berger Strategy Consultants provides good insights into the importance that German industry places on increased digitization in its industry.  You can read a report on this study by clicking here (PDF file).

The process of digitizing industrial processes, which has been going on for a long time, when combined with the concepts and capabilities associated with Industry 4.0 is believed to be leading to a 4^th industrial revolution.

German companies support this embracing of Industry 4.0.  Siemens discusses the digital factory, Industry 4.0, and seven facts to know about the future of manufacturing (click here). SAP has an extensive overview on how to prepare for the fourth industrial revolution (click here).  Rexroth Bosch explains how they can support Industry 4.0 (click here).  Pepperl + Fuchs present their perspectives on Industry 4.0 (click here).  These are just a few of the German companies that provide support to companies pursuing Industry 4.0 goals.

German chemical companies are pursuing Industry 4.0-related activities.  At this link (click here), you can read about how BASF is implementing Industry 4.0-related processes.  An Evonik publication has articles on its activities related to big data, digitization, and the “Internet of Things”, all important components in Industry 4.0 (click here – PDF file).

Such benefits as:  better products at less processing costs; more timely delivery of products to customers; lower use of raw materials, with less waste; and decreased energy use, including lower CO2 emissions are driving companies toward Industry 4.0.

Chemical and Metal Shortage Alert – November 2016

The purpose of this blog is to identify chemical and metal shortages reported on the Internet.  The sources of the information reported here are primarily news releases issued on the Internet.  The issue period of the news releases is November 2016.

Section I below lists those chemicals and metals that were on the previous month’s Chemical and Metal Shortage Alert list and continue to have news releases indicating they are in short supply. Click here to read the October 2016 Chemical and Metal Shortage Alert list.

Section II lists the new chemicals and metals (not on the October alert).  Also provided is some explanation for the shortage and geographical information.  This blog attempts to list only actual shortage situations – those shortages that are being experienced during the period covered by the news releases.  Chemicals and metals identified in news releases as only being in danger of being in short supply status are not listed.

Section I.  

Aluminum: China; supply not keeping up with demand

Coking coal: China; supply not keeping up with demand

      

Section II.   Shortages Reported in November not found on the Previous Month’s List

Steel:  Iran; production not keeping up with demand

Styrene:  Asia; production not keeping up with demand

Zinc:  global; mining not keeping up with demand

Reasons for Section II shortages can be broadly categorized as: 

1.  Mining not keeping up with demand: zinc

2.  Production not keeping up with demand: steel; styrene

3.  Government regulations: none

4.  Sources no longer available: none

5.  Insufficient imports:  none

6.  Supply not keeping up with demand: none