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Listen to Rina Quijada, Senior Director of Latin America for chemical, explain how a petrochemical company expanded its market share through solid, long-term investments in multiple countries using IHS Markit data and forecasting across the entire supply chain. From feedstocks to end-use products, company leaders are making informed business decisions that set the stage for long-term growth.
IHS Customer Recognition (CR): What are some major issues impacting the petrochemical industry in the Americas?
Quijada: The petrochemical industry is closely related to the energy side of the business as it feeds its raw materials from hydrocarbon-based products. Seventy-five percent of cash costs of production of petrochemicals is based on feedstocks, so it’s a very important part of the business. On the demand side, it has a very close link to economic growth. In Latin America, as an emergent market, we see increased growth. Some numbers for the future will be GDP growth in the neighborhood of three-to-four percent growth per year. So it’s becoming a relevant market. For the future, we see a trend where Latin America is becoming more of a strategic market for companies in North America, rather than opportunistic as in the past. Many changes are happening at the moment regarding the structure of the petrochemical business in the Americas.
CR: What are this organization’s strategic business goals?
Quijada: The strategic goal of this Latin American petrochemical leader is to grow its market share, not only in the Americas but also globally. They are doing this with a firm commitment to research and development and in a sustainable manner. They can grow using competitively priced feedstocks globally. In doing so, they hope to get - even gain - a much larger market share in their petrochemical industry.
IHS was able to provide the global context of this industry for this company, providing a third-party validation for multi-billion dollar investment …
CR: What challenges does this organization face to achieve its goals?
Quijada: This company faces several challenges when pursuing information to make decisions, not only for their existing business, but also for future investments in the petrochemical industry. They are in a region where many, many changes are happening, where their local currency is volatile, where they import feedstocks for their current production. So they have to not only be able to find reliable, timely and also accurate market information, but they also need the short-term and long-term views on the petrochemical industry.
CR: What results has the organization achieved by working with IHS?
Quijada: This company is using IHS insight and information to address many issues that they are looking at when they are looking for current and future investments in petrochemicals. Not only from feedstock—what is energy, what is natural gas doing—but throughout the production chain to the final end-use good. That’s where our expertise at IHS, and the price forecast solutions that we have for the short term and the long term, has provided solutions for this company. IHS was able to work with the client and provide insight necessary for the company to make solid investment decisions that are long-term decisions. This investment that was the main object of our service to this client is an investment not only in one country, but in many countries throughout the Americas. IHS was able to provide the global context of this industry for this company, providing a third-party validation for multi-billion dollar investment that will only provide return in 10 or 15 years.