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Brazil: a natural vocation for the chemical industry.
Rich in oil, gas, biodiversity, minerals and rare earths.
Brazil’s Chemical Industry Overview
June 2016
Agenda
• ABIQUIM and the Brazilian Chemical Industry
• Raw Material & Market Power
• Education, Research & Innovation
• The Biobased industry in Brazil
ABIQUIM AND THE BRAZILIAN CHEMICAL INDUSTRY
The Brazilian Chemical Industry Association
- Founded in 1964
- Non-profit organization
140 member companies
- Mercosur Council of Chemical Industry (CIQUIM)
- International Council of Chemical Associations (ICCA)
ABIQUIM’s main goal is to enhance competitiveness and
sustainable development of the chemical industry.
Fonte: ABIQUIM.
The importance of the Brazilian chemical industry
6 World Largest
10% of the Brazilian industrial GDP
US$ 112.4 Billion on net sales (2015)
Brazilian Chemical Industry Net Sales – 2015 (*) (US$ bn)
Total: US$ 112,4 bn
Sources: Abiquim and associations of specific segments
(*) Estimated.
Industrial chemicals 54,9
Pharma13,2
Fertilizers12,5
Soaps and Detergents
5,2
Perfumes and Cosmetics
11,1
Agrochemicals9,6
Paints and Varnishes3,1
Others1,9
Fibers0,9
Brazilian Largest Chemical Producers Net Sales - 2010
Source: Abiquim
COMPANY NET SALES (US$ millions)
COUNTRY OF ORIGIN MAIN PRODUCTS
BRASKEM 14,479,110 Brazil Ethylene, Propylene, PE, PP, PVC, chorine, soda and intermediates
BASF 2,949,801 Germany Paints, agrochemicals
BAYER 2,085,399 Germany Agrochemicals and PU
SYNGENTA 1,683,970 United Kingdom Agrochemicals
WHITE MARTINS 1,665,434 USA Carbon dioxide, hydrogen, nitrogen, oxygen and special gases
DUPONT 1,577,317 USA Agrochemicals and intermediates
VALE FERTILIZANTES 1,520,203 Brazil Fertilizers and intermediates
RHODIA SOLVAY 1,337,929 Belgium Phenol/acetone, nylon
DOW 1,252,197 USA PU and interm., chorine and soda
UNIGEL 1,160,298 Brazil PS, acrylonitrile, methacrylates, cyanides, polycarbonate
91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14
1,5 1,3 2,0 2,9 4,6 5,4 5,86,5 6,3 6,67,2 6,3 6,2
8,6 7,9 8,413,3
23,2
15,720,7
26,528,1
32,0 31,2
Deficit
Brazilian Trade Balance Chemical Products – 1991-2014
91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14
2,1 2,3 2,5 2,8 3,4 3,5 3,8 3,6 3,4 4,0 3,5 3,8 4,8 5,9 7,4 8,910,7 11,9 10,4
13,0
15,8 14,814,2 14,5
3,6 3,6 4,5 5,7 8,0 8,9 9,7 10,1 9,8 10,7 10,810,1 11,014,5 15,3
17,4
23,9
35,1
26,1
33,7
43,046,1 45,7
Exports Imports
Deficit booming 1991: US$ 1.5 billion 2014 = US$ 31.2 billion
Source: Sistema Aliceweb – MDIC/Secex
DESCRIPTION ∆ 2014/2013
∆ a.a. 2014/1991
IMPORTS (0.9%) +11.7%
EXPORTS +2.6% +8.8%
DEFICIT (2.4%) +14.1%
RAW MATERIAL & MARKET POWER
The raw-materials potential in Brazil
Brazil may be one of the largest oil producers in the world.
Between 2013-2014 there was an increase of 230,000 bpd (11%).
With monthly growth, the Pre-salt has increased its share of national production, rising from 27% to 29%.
Gas production will triple by 2030.
The production of natural gas in January 2015 was the largest ever recorded, when reached 96.6 million cubic meters.
The raw-materials potential in Brazil
Brazil has the greatest biodiversity in the world, favoring the production of chemicals from renewable raw materials.
On May 2015, the New Brazilian Biodiversity Law was enacted.
Minerals: ex. quartz and rare earths
Market Power
9.7% share of
the world market
Cosmetics
20.5% share of
the world market
Agrochemicals
8.1% share of
the world market
Chemicals for leather
24.6% rate of growth
(2007-2012)
E&P
EDUCATION, RESEARCH & INNOVATION CONTEXT
Education
• In the last two decades the number of undergraduate students grew 550%, at the same time that the Brazilian population grew 25%.
• 40 thousand engineers graduate in Brazil per year.
• The chemical sector, specifically, is not labor intensive, but requires a higher level of training, which gives a wage, on average, 75% greater than the overall industry.
• Science without Borders: over US$ 2.9 billion BSc, MSc, Dr., PhD, up to full professors on exact sciences and engineering.
• PRONATEC: over US$ 260 million investment on technical level.
Research
• Brazil figures in the 13th position on scientific publication.
• From 2008 to 2010, 56% of the Latin American scientific articles were Brazilian.
• In the last 10 years, the average rate of development of scientific articles in Brazil is 8%/ year.
• The main areas of publications are: agricultures, chemistry, physics, engineering, molecular biology and biochemistry.
• 35% of Brazilian researchers are working in the business sector.
Innovation
• Brazil invests 1.3% of GDP in R&D.
• The goal of the Brazilian Government is to reach 2% of GDP by 2020.
• Developed economies have rates above 3% of GDP.
• The Brazilian Development Bank (BNDES) and the Brazilian Innovation Agency (FINEP) offers credit and grants for R&I
Brazilian Research Corporation on Industrial Innovation EMBRAPII
• 13 research centers on different technological areas
• Over US$ 5.8 million
• Up to 90% of granted support for pre-competitive research
New R&I network
Over 50 new laboratories and 26 new applied research centers are being created by the Brazilian National Industry Confederation.
Biomass, biosynthetic, building technologies, ceramics engineering, defense, electrochemistry, integrated solutions in metalworking , IT, metallurgy and special alloys, mineral technologies, nanotechnology, polymers, renewable energy, welding, and not only.
Investment Plan for Development and Innovation (PADIQ)
• Main goal: – Fostering technological development projects in the manufacture of
chemicals.
• Opportunities identified in the Study of the Potential for Diversification of the Brazilian Chemical Industry (BNDES/Bain Company).
Priority Segments Identified:
• Food Additives for Animals
• Silicon Derivatives
• Carbon Fibers and Composites
• Chemicals for E&P
• Cosmetics and Personal Care
• Renewable Chemicals
Investment Plan for Development and Innovation (PADIQ)
THE THRIVING BIOBASED INDUSTRY
Source: Rennovia and IHS, 2013.
Biotech World Market
Global market for renewable chemicals is expected to grow from US$ 3.6 billion to over US$ 12 billion by 2020.
It is estimated that by 2025 ~40% of the world economy will be based on biotechnology.
BIOLOGICAL RESOURCES EMPLOYED TO OBTAIN
PRODUCTS AND/OR PROCESSES
Brazil is an agricultural powerhouse
• Among the world’s top producers and exporters of sugar, ethanol biofuel, orange juice, coffee, soybeans, beef, poultry, pork, tobacco and forest products.
• New agricultural frontiers being opened up for agricultural development, putting Brazil at the cutting edge of innovation, research and development in agricultural techniques, technologies and productivity gains.
• Sustainable agriculture: Brazil has the lowest carbon emissions among the world’s largest agricultural players.
Biobased chemistry
• Offers very competitive feedstock prices in low eco footprint conditions, it has plenty of land and suitable climate.
• Dominates the biomass with greater potential today: sugar-cane.
• Has training in the development and management of biomass production: EMBRAPA.
• Has experience in the production and distribution of biofuels on a large scale.
• It is the country with the highest biodiversity in the world.
• Has fast-track for patent analysis on green technologies.
