Opportunities in Poland’s rapidly growing chemicals sector
The chemical industry in Poland covers a wide variety of product segments, from base and agricultural chemicals through specialty and fine products to pharmaceuticals. The value of the market in 2009 was estimated at €17.5 billion (PLN 76 billion) , which accounted for 3.4% of the total value of the European chemicals market.
The most interesting opportunities in the coming years centre around the base and agricultural chemicals segments. These account for 45.4% of the chemicals market value in Poland, with a total revenue of €8.0 billion (2009). The Minister of State Treasury has announced a relaunch of the privatisation process for the most significant Polish chemical production plants (ZA Puławy, ZCH Police, Ciech SA, ZAK, ZAT). The process is intended to start in mid-2011. According to the ministry’s declaration, it will seek investors willing to acquire controlling stakes in Poland’s leading chemical producers.
The privatisation will be led separately for all the entities, however an investor willing to
take over more than one entity may be treated preferentially.
Additionally, PKN Orlen has announced disinvestment plans of its chemical asset – Anwil SA. This large chemical producer, which focuses on the production of nitrogen fertilisers, PVC and caprolactam, may generate business and operational synergies with other privatised entities.
The Polish chemical segment generates substantial opportunities for potential future investors. On the one hand, a strong focus on base chemicals forms good ground for future investments and an opportunity to shift production to more lucrative specialty production. A strong basis for development is the presence of a well-trained and skilled labour force, stable access to base feedstock and a well developed local production of base chemicals. On the other hand, Polish fertiliser production is currently split between a number of players and potential consolidation may generate significant synergies to an investor. The key issues facing the chemical sector in Poland which must be faced by potential investors are the price of gas and, with the exception of Anwil SA, the necessity
for deep cost restructuring.
In 2014 the Polish chemicals market is forecast to have value of €21,9 billion (PLN 95.0 billion), an increase of 25.1% from 2009. This forms a business opportunity worthy of consideration by both large investors interested in the privatisation processes, as well as small- and medium-sized firms seeking a stable market for future development.