SOURCE: Industrial Info Resources

Industrial Info Resources

February 18, 2010 05:15 ET

U.S. Chemical Processing Spending to Increase and Shift Geographically in 2010, a "Navigating the Currents of Change" Webcast on Industrialinfo.com

SUGAR LAND, TX--(Marketwire - February 18, 2010) -  Written by John Egan for Industrial Info Resources (Sugar Land, Texas) -- The Chemical Processing Industry (CPI) has increased scheduled 2010 capital and maintenance project spending in the U.S. by about $100 million more than what it said it would spend three months ago, Trey Hamblet, Industrial Info's vice president of research for the chemical processing industry, told about 500 attendees at Industrial Info's "Twenty-Ten Industrial Market Outlook" in Houston on January 27.

The "Twenty-Ten Industrial Market Outlook" event coincides with Industrial Info's release of the 2010 Global Industrial Outlook, which highlights the industrial spending forecast for the coming year. Since 1993, IIR has published a forecast for capital and maintenance spending for the industrial market in North America, and the 2010 outlook marks the fifth year of projecting spending estimates around the world.

Currently, Industrial Info is tracking 836 CPI projects with a 2010 construction kick-off date. These projects carry a total investment value (TIV) of $6.37 billion. In November 2009, Industrial Info was tracking 727 CPI projects that were scheduled to begin in 2010. These projects carried a TIV of $6.26 billion. However, all of these projects are not expected to begin according to schedule, Hamblet said.

The geographic distribution of CPI project spending this year also is shifting, Hamblet told attendees at the Houston briefing. This year, CPI spending in the Southwest (Texas, Louisiana, Oklahoma, and Arkansas) will decline by $425 million to $2.68 billion. This figure includes $1.9 billion in capital projects and $720 million in maintenance projects. By contrast, last November Industrial Info was tracking projects totaling $3.1 billion of CPI spending in the Southwest. "The Southwest has been very hard-hit by production cuts in petrochemical plants," Hamblet said.

But the decline in 2010 project spending in the Southwest will be offset by increased spending in other regions, including the West Coast, Southeast, Great Lakes, and Midwest regions, he noted.

Hamblet said, "The real question in 2010 is, 'How fast will the economy recover?' The speed of that recovery will determine how rapidly companies restock goods, which in turn will drive spending in the Chemical Processing Industry."

The Industrial Info vice president noted that operating rates at CPI facilities have increased in recent months and that the industrial gas segment has "bucked the trend" and grown during the recession. "The plastics and rubber segment has seen a huge increase in the number and value of projects," Hamblet said, and there are "quite a few exciting things happening in the Great Lakes region."

"Although chemical companies have a very large backlog of projects -- about $2.7 billion worth -- consumers will be the ones deciding how many of these projects will move forward," Hamblet said.

Attendees at the Houston event represented a broad spectrum of industry: equipment vendors, distributors, manufacturing firms, engineering and construction firms, labor organizations, and financial service companies. The Houston event was the first of several spending forecast events that Industrial Info will hold throughout North America in 2010. Future market outlook executive briefings are scheduled to take place in Denver, Colorado; Atlanta, Georgia; Baltimore, Maryland; Cleveland, Ohio; and Pittsburgh, Pennsylvania.

Chemical Industry capital and maintenance project spending is very dynamic right now, Hamblet said, and this dynamism is reflected in Industrial Info's project-tracking data. The outlook for CPI spending is driven by Industrial Info's commitment to reporting, confirming, and frequently updating capital and maintenance project-spending decisions as they are made by CPI companies. Industrial Info's quality-assurance principle, which it trademarked as the Living Forward Reporting Principle™, ensures that clients are provided with the most accurate and current market intelligence on industrial project spending around the world, including capital projects, maintenance spending, analytics, and market forecasting. Click here to join Mr. Hamblet on this edition of "Navigating the Currents of Change" for a discussion of projected North American project spending in the Chemical Processing Industry.

Industrial Info Resources (IIR) is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy-related markets. For more than 26 years, Industrial Info has provided plant and project spending opportunity databases, market forecasts, high resolution maps, and daily industry news. For more information send inquiries to chemicalsgroup@industrialinfo.com or visit us online at www.industrialinfo.com.

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