BMI View: The Colombian petrochemicals industry reported an overall solid growth performance in 2015, although rubber output was hit by a contraction in sales that was partly caused by a decline in output in the automotive industry. T he refining sector is expanding with the potential for increased naphtha feedstock for petrochemicals, but this will be insufficient for any new cracker facili ty in the country.
The Colombian petrochemicals industry saw mixed results in 2015 with strong growth in basic chemicals and contraction in synthetic rubber. In 9M15, the real production index for basic chemicals and their derivatives grew by an average of 6.9% y-o-y on the back of 6.9% growth in the sales index. However, over the sale period the real production index for rubber slumped 10.2% y-o-y with the sales index declining 11.5%. Plastics output soared 14.1% y-o-y as sales rose 4.4%.
The Reficar refinery in Cartagena was due to complete its expansion from 80,000b/d to 165,000 b/d by March 2016, providing a potential naphtha boost for downstream olefins production. The announcement of a potential sixth facility would contribute an additional 260,000b/d in refining capacity, posing upside risk our current downstream projections. Growth in LPG derived from natural gas could also serve as an alternative petrochemicals feedstock, enabling greater flexibility for petrochemicals cracking operations.
In terms of petrochemicals consumption, protracted construction growth should support consumption of PVC and PP, which together account for over 80% of Colombian polymers production capacity. On the downside, the automotive sector shrank in 2015 and the outlook over the next five years shows only modest growth rates, which will continue to depress the rate of growth in rubber and other petrochemicals-based automotive parts.
In 2014 Colombia's petrochemicals facilities included capacities of 120,000 tonnes per annum (tpa) ethylene, 45,000tpa benzene, 20,000tpa toluene, 35,000tpa xylenes, 45,000tpa polyethylene terepthalate (PET), 60,000tpa low density polyethyelen (LDPE), 103,000tpa polystyrene (PS), 400,000tpa poly vinyl chloride (PVC), 500,000tpa PP, 115,000tpa ammonia and 185,000tpa urea.
An ongoing downside factor is the falling size of the country's oil reserves which, if there is no increase, will be unable to sustain current levels of oil output after seven years and as a result could undermine long-term feedstock availability. Ecopetrol plans to scale up from 722,000b/d to 870,000b/d by 2020 and add 1.7bn barrels of proven reserves by the same year under its investment programme.
In BMI's Americas Petrochemicals Risk/Reward Index Colombia is in sixth place with its Risk/Reward Index (RRI) remains at 42.8 points, unchanged since the score. The market and country risks have stabilised with upsides and downsides balancing out. On the upside, the petrochemicals industry is witnessing a recovery in sales volumes and declining feedstock prices. On the downside, declining upstream output puts in jeopardy the sector's long-term sustainability.
The Colombia Petrochemicals Report has been researched at source, and features BMI Research's market assessment and independent forecasts for key petrochemicals sub-sectors. The report also analyses the impact of regulatory changes, recent developments and the background macroeconomic outlook and features competitive landscapes comparing companies by products and services, sales, market share, investments, projects, partners and expansion strategies.
BMI's Colombia Petrochemicals Report provides industry professionals and strategists, sector analysts, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Colombian petrochemicals industry.
- Benchmark BMI's independent petrochemicals industry forecasts to test other views - a key input for successful budgetary and planning in the Colombian petrochemicals market.
- Target business opportunities and risks in the Colombian petrochemicals sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Colombia.
- Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. KPIs and latest activity).
BMI Industry View
Summary of BMI’s key industry forecasts, views and trend analysis, covering the petrochemicals markets, regulatory changes, major investments, projects and company developments.
Industry SWOT Analysis
Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the petrochemicals sector and within the broader political, economic and business environment.
BMI Industry Forecasts
Historic data series (2009-2013) and forecasts to end-2019 for key industry and economic indicators, supported by explicit assumptions, plus analysis of key risks to the main forecasts. Indicators include:
- Energy: Oil production (‘000 b/d), oil consumption (‘000 b/d), net oil exports (‘000 b/d), gas production (bcm), gas consumption (bcm), net gas exports (bcm), oil refinery capacity (‘000 b/d).
- Petrochemicals: Ethylene capacity (‘000 tpa), ethylene production (‘000 tpa), ethylene consumption (‘000 tpa), polyethylene capacity (‘000 tpa), polypropylene capacity (‘000 tpa), polyvinyl chloride capacity (‘000 tpa), polyolefins consumption (‘000 tpa).
- Oil Products Prices: Price forecasts for all major oil-based products (USD/bbl) at major global energy trading hubs.
- Economic: Nominal GDP (USDbn), real GDP growth (%), GDP per capita (USD), population (mn), unemployment (%), exchange rate (against USD).
BMI’s Petrochemicals Risk Reward Index
BMI’s Risk Reward Indices provide investors (both corporate and financial) looking for opportunities in the region with a clear country-comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide indices of highest to lowest appeal to investors, with each position explained.
Structure, size and value of the industry sector; overview of the industry landscape and key players; assessment of the business operating environment and the latest regulatory developments.
Industry Trends & Developments
Evaluation of company and sector-wide developments, including key projects (as well as expansion plans), latest company financial details and proposed international ventures.
Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.
Global & Regional Market Overview
Analysis of the key trends driving the global industry, including worldwide output/capacity and demand analysis across ethylene, polyethylene, polyvinyl chloride, polystyrene, polyethylene terephthalate and polypropylene. The regional analysis looks at the implications of local and global trends on specific company activity.
Sub-sectors covered by the Petrochemicals Reports include:
Oil & Gas, Oil Refining, Olefins (ethylene, propylene), Polyolefins (polyethylene, polypropylene), Polyvinyl Chloride, Polystyrene
Please note – not all country Reports cover all sub-sectors – see website for details.
The Petrochemicals Market Reports are based on a network of primary sources, such as multilateral organisations (ACC, APLA, Cefi c, ICCA, ICMA), national chambers of commerce and industry, national statistical offi ces, government ministries and central banks, and multinational companies.
*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.