FECC Congress: Industry Recovery is Slow in Spain

Chemical production in Spain is expected to be broadly flat in 2010 compared with 2009 as the industry struggles to cope with the effects of the global economic and financial crisis and continued uncertainty and volatility in the euro zone, says Fernando Iturrieta, president of Spanish chemical industry association Feique (Madrid) and CEO of petrochemicals producer Cepsa Quimica (Madrid). In a keynote address to the European chemical distributors’ association FECC (Brussels) annual congress, which opened yesterday in Barcelona, Iturrieta said that output of chemicals dropped almost 11% in 2009 compared with 2008.

Meanwhile, sales by the Spanish chemical industry declined to €47.7 billion ($58.3 billion) in 2009 from €52.6 billion in 2008. However, chemicals performed relatively well in comparison with the rest of Spanish industry. “Output and sales declined in 2009 compared with 2008, but the decline was not as bad as for industry overall,” Iturrieta says. “We expect chemical production to be very slightly up in 2010. But chemical industry sales at the end of 2010 will still be lower than in 2006,” he says.

Spain’s high unemployment rate is reflected in weak chemical consumption, Iturrieta adds. The Spanish chemical industry has to overcome a number of challenges including a lack of transportation infrastructure, low productivity, high costs, a rigid labor market, and a shortage of recruits with chemistry-related and technical qualifications, he says. The chemical industry in Spain would benefit from a more “fair and efficient legal framework, lower energy costs, improved efficiency in transportation, increased productivity, and better access to financing,” Iturrieta says. Only 1% of chemical deliveries in Spain are by rail, he adds.