April 7, according to Deloitte Global Manufacturing Industry Group recently released report “2010 Global Chemical Industry Outlook”, 2010, the global chemical industry is expected to be a modest increase. Despite rising global potential market demand, but the main end market demand and unbalanced. Automotive, construction, electronics and pharmaceutical markets rose gradually to bring the dawn of the chemical industry.

Report is expected that many chemical companies will continue to implement the 2010 cost saving measures; but the effectiveness of such initiatives is declining, and forced chemical companies the cost of more stringent review of its structure. Enterprises in order to better meet the actual market situation, its strategy will focus on simplifying complex procedures and careful management of raw material cost. In addition, the company began to look closely and adjust its supply chain and adopt a flexible approach to meet the human capital gradual recovery of market demand.

2010, while there are other critical issues. Japan chemical companies, to preserve cash and increase free cash flow of innovative business model designed to offset the increasingly meager earnings impact. For the specialty chemicals business, its focus will focus on the adoption of new applications and services, geographic markets, and core technology, growth and profitability. Effective integration of market players will continue to move downstream, the value creation potential to buy more assets, and lower sales, management and administration costs (SG & A).It is expected that, due to issues such as energy, health and climate change and innovation in key technology investment will occur in 2010 related to growth opportunities. Government’s economic stimulus package will help promote research and development of technological innovation, despite the restrictions on the R & D budget to promote chemical industry and academia to strengthen technology and minority entities to cooperate in bringing innovative ideas into the market.

Although R & D budget has been steadily reduced, but chemical companies can anticipate their long term business value and impact of driving the current growth strategy. The current industry focus on the growing demand response to help reveal a number of major global trends, and lay a good foundation for the future and become the main source of income.According to prospect, develop customer base is another major objective of the 2010, but due to the economic recession led to changes in customer preferences, to achieve that goal may be challenging. In addition, while operating daily chemical and specialty chemical business, enterprises need to look at those from a new perspective should continue to operate as a specialty chemicals and capital growth opportunities for products, so the importance of portfolio management has been enhanced.

This year, M & A transactions are still expected to rise to become a strategic priority for the chemical industry. Many enterprises to actively evaluate acquisition targets to complement the existing business portfolio, and as credit markets continue to improve, increasingly attractive valuation result, companies will pay attention to this year’s M & A opportunities. With the improvement in liquidity, private equity funds are expected to rise again. Comprehensive and specialty chemical companies need to focus on simplifying the portfolio, from bad business. Daily chemical enterprise of cash scarcity, should be actively rational allocation of production capacity.

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