The coronavirus (COVID-19)
outbreak further hit the possibility of revival in the global economy as the
death toll rises to more than 3200 in 86 countries with number of positive
cases rising to more than 87,000 as of March 2020. Taking into consideration
the ongoing economic disruption and prolonged suffering to the human life due
to the deadly outbreak, the annual global GDP growth is expected to fall to 2.4
per cent in 2020 as a whole, from an already low percentage of 2.9 in 2019. Output
contractions in China have adversely impacted the financial markets, travel
sector and supply chains across the globe.
The containment efforts of the
virus which involve quarantines, trade restrictions and curtailed production
activities have severely impacted almost all the economy driving sectors such
as steel, oil & gas, consumer durables, pharma, IT and Chemicals. India
holds deep trade linkages to China, and the outbreak of the virus at a time
when trade between India and China has increased to $93 billion, has obviously
not spared the Indians. As an effect of this, the Indian chemical industry, has
become susceptible to volatility in the prices of various imported chemicals
and supply chain disruptions. According to ministry of commerce data, China
accounted for 13.7% of India’s total imports in FY19 while export volumes to
China had 5.1% share.
Extended plant shutdowns in China
and restrictions on shipments or logistics are imparting shivers to the traders
and has put a significant impact on the operations throughout the Asia-Pacific
region. Consequently, India's chemical and petrochemical sector would have to
depend on alternate geographies for importing important raw materials. This
would also mean higher exportable surplus than usual which would eventually
lead to higher dumping of goods in other countries. The outbreak seems to hit
hard India’s pharmaceutical sector which currently imports 80% of Active
Pharmaceutical Ingredients (API’s) required for manufacturing medicines, from
China. The India’s drug pricing regulator has already reported and undue rise
in retail prices of medicines due to surge in the prices of chemical
price like paracetamol, aspirin, azithromycin, amoxicillin etc. and the
pharma industry fears that they could soon run out of stock if the supply
shortage persists. However, some of India’s chemical industry players are
optimistic about the virus impact as it has given way to the domestic players to
increase their profit margins and boost their manufacturing activities. Thorough
analysis of international competitors' supply chains and loopholes in the
domestic market would help the domestic players to benefit at this crucial
moment.
As per the analysts, the
situation can act as a silver-lining for Indian manufacturers who would have to
look for where the opportunity may lie. India is self-sufficient in naphtha,
the feedstock for petrochemical building blocks and bulk polymers, however due
to shortage of many petrochemical intermediaries, India’s dependence on China has
increased since past few years. This has created an urgent need among the
Indian chemical industrialists to develop a far-sighted approach towards enhancing
their footprints in the Indian Chemical and Petrochemical industry and analyze
the risks involved.
Our ChemAnalyst team comprises of
versatile analysts dedicatedly keeping an eye on the day-to-day price movement
of major chemicals under its 178-product portfolio and provide chemical market
intelligence. The 6 product categories includes: Bulk Chemicals and
Fertilizers, Elastomers, Feedstock, Petrochemicals, Polymers and Resin and
Specialty Chemicals, thereby covering majority of The news section covers massive
movements in the Indian and international chemical market along with daily
fluctuations in the oil and gas sector. ChemAnalyst, through sophisticated
models and techniques delivers unbeatable insights and market information
thereby, facilitating potential investors to have deeper their penetration in
the Indian chemical and petrochemical industry.
About ChemAnalyst : ChemAnalyst,
a division of TechSci Research focuses purely on chemical industry and offers
in-depth, granular level data and business intelligence in chemicals and
petrochemicals industry. Its Unique Selling Point lies in offering rigorous and
powerful analysis of chemical pricing
and market analysis for over 175 chemical and petrochemical products. ChemAnalyst
tracks the Prices, Product Demand, Foreign Trade Data, Installed Capacity,
Production, Technology Licensor/Licensee, Operating Efficiencies, Region-wise
and Application-wise Demand, Demand for Specific Grade of Type of Product,
Competitive Landscape, Customer Analysis, Recent Trends & Developments,
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